Thousands of homeowners all over the United States have made the decision to go solar.

In an age where sustainability and environmental awareness are at historically high levels, the combination of reducing their carbon footprint and receiving a very reasonable return on investment has made the decision to switch an easy one. As the cost of solar cells fall, the economics behind implementing solar systems continue to improve. While some are focusing on energy efficiency, others want to go a step even further.

understanding your electricity bill post solar

So, while you are making the decision about whether or not to go solar, what are some questions to help you become more informed about how solar will change your electric bills?

  • What Is A Solar Energy Monthly Statement?
  • What Is Net Energy Metering (NEM)?
  • How Do You Break Down Your NEM Balance?
  • How Does Solar Allow You To Save Money?
  • Do You Still Have An Electric Bill When You Go Solar?
  • How Much Can A Solar System Reduce Your Carbon Footprint?


What Is A Solar Energy Monthly Statement?

Most solar systems are considered to be “grid tied” which means they are still connected to the electric distribution system that your local utility maintains. This means that this utility will send you a solar energy electric bill or statement each month. This will tell a homeowner things like how many kilowatt-hours generated this past month, how this compared to the same month one year ago, the solar savings that your system afforded you, and even the environmental benefits such as total carbon offsets. This solar energy electric bill will be in addition to your regular electric bill but will not add any additional expenses if you have purchased your solar system outright.


What Is Net Energy Metering (NEM)?

One of the most important things to realize about renewable energy sources that is very different from more traditional fossil fuels is that renewables are not always able to generate power. In the case of solar, arrays can only generate energy for consumers when the sun is out and the sky above is relatively cloud free. Luckily, NEM allows consumers to reap the benefits of solar even when there is no sun to activate the system. NEM allows consumers to generate solar during the day and export any excess power that the home does not need to the grid. This excess power can then be credited back to the home’s electric meter at night when the solar array is no longer producing power. This way, homeowners are guaranteed to receive credit for every kilowatt-hour generated regardless of when it was used.


How Do You Break Down Your NEM Balance?

An NEM balance will typically show three different figures. The first is the total number of kilowatt-hours that your home used directly from your solar array. The second is the number of kilowatt-hours that were in excess of this figure and thus exported out to your local utility’s grid. This will almost always be equal to the third figure found on your NEM balance which is the total number of kilowatt-hours to be credited towards your next electric bill. The only way that the number of exported kilowatt-hours and the available kilowatt-hours for credit could be different is if in the previous month, your home was able to run entirely on solar energy and the excess credits rolled over into the following month.


How Does Solar Allow You To Save Money?

There are a variety of ways that solar power helps you save money. The first is by offsetting the electricity rates of your local utility. Lets say for instance your local utility rate was ten cents per kilowatt-hour. If you were to use one thousand kilowatt hours in a month, you would typically pay a bill of one hundred dollars. If you owned a solar system that met all of your electricity needs, these electricity costs could be fully eliminated. Next, to give consumers an incentive to use clean energy like solar, some state governments have created a Solar Renewable Energy (SREC) Market. One SREC is generated for every 1,000 kilowatt-hours of energy that is generated. These SREC’s are then sold to utilities so that they can comply with a state mandate which states that a certain percentage of the power in the grid must come from renewable resources. As these mandates are raised over time, homeowners can sell these SREC’s for higher and higher values. Another final way in which solar allows you to save money is through the Investment Tax Credit (ITC). The ITC allows homeowners to receive a credit on their taxes the following year equal to 30% of the total cost of their array. This means that if you spend $10,000 on a full array including solar panels, inverters and racking, you should see a tax credit for $3,000 in the following year. Through the combination of energy offsetting, SREC’s in areas where there is a market for them, and the Federal ITC, homeowners have more ways to save money from solar than ever before.


Do You Still Have An Electric Bill When You Go Solar?

As long as your solar system is grid tied, you will still receive an electric bill every single month. This does not necessarily mean that you will be paying anything to your local utility. In theory, if your solar system were sized to produce more electricity than your home uses, the utility would actually owe you money. This is because all utilities are required to accept any excess generation from homes in their territory. Homes that are able to produce more power than they consume usually have taken other measures to reduce their energy demand such as energy efficiency upgrades and other passive solar tactics. Although you will still receive a bill, the solar savings you will receive will make it far lower than before.


How Much Can A Solar System Reduce Your Carbon Footprint?

Solar cells are one of the few energy sources that have absolutely no carbon emissions. This is because the “fuel” used to generate electricity is sunlight which is completely renewable and does not need to be burned like coal or natural gas. To figure out the reduction of your carbon emissions, you should first look at your energy usage over the past year. The average homeowner consumed roughly 870 kilowatt-hours per month last year. This equates to an average annual usage of 10,440 kilowatt-hours. Every kilowatt-hour generated by a traditional fossil fuel fired power plant emits approximately 1.2 pounds of carbon emissions. By this math, the average home could offset upwards of 12,528 pounds of carbon emissions if their solar panels had the ability to provide one hundred percent of it energy usage.

The reliance on fossil fuels is beginning to lessen every year. As people seek more sustainable ways to generate electricity, solar power continually appears near the top of the list. Clean energy makes sense not only for the environment, but also for the pocket books of consumers. As electricity rates continue to rise, the switch to solar has never made more sense. While the initial switch may seem a bit confusing, by being an informed solar owner, you can can fully understand your true electricity costs by correctly reading your electric bill. The migration towards solar has only just begun. By becoming a more informed individual, you may find that your best choice for energy production is clear.