Case Study: Electricity Bill Savings via Home Solar
To help you better understand how to value a potential investment in solar, we’ll describe two scenarios – a house with a residential solar system and one without.
Without Solar
Today, without a residential solar system, a typical household might pay an average of $170 per month for electricity, adding up to $2,000 in a single year.
This expense increases each year due to rising utility rates. Historically, utility rates in California have gone up 6.7% annually—essentially doubling every 12 years. This means that a household paying $2,000 a year for electricity today will pay $4,000 a year by 2021, and nearly $10,000 a year in 25 years, simply due to this increase in utility rates.
During the next 25 years, this household will pay over $120,000 for electricity.
With Solar
A residential solar system will significantly lower electricity bills by reducing the amount of energy the household needs to draw from the grid.
In California, the more electricity you use, the more you pay per kWh. Going solar allows you to take advantage of the utility’s tiered energy pricing structure because it reduces the most expensive unit of electricity first.
A solar system that generates 50% of a household’s electricity demand might save 60% of the bill. Over the life of the home solar system, the savings could add up to $68,000 in lower electricity bills.
Sungevity Savings
How much does it cost to save $68,000 in electricity bills with solar? Sungevity has dramatically improved the process of getting solar by utilizing our proprietary Web platform. We save time and have lower costs, and we share the savings with our customers. This means that our prices are generally 10% less than other solar companies.
As one point of comparison, at Sungevity, a 3.7kW CEC or 4.2kW STC system will cost $30,000. That same solar system installed on a typical California home by another solar company would cost, on average, about $33,000.
A final note about smaller solar systems: they cost less, but also save you less money - in total dollar terms. They usually have a higher IRR due to the fact that they help keep you from paying for electricity at the highest priced tiers.
For a customized look at the financial benefits you would receive with a residential solar system, simply enter your home address above or call us at 877.257.8648 and we will create an interactive solar quote for you.