Many people looking into solar energy or other sources of renewable energy express concern about the payback period. It’s a common response. Recently, a friend’s 97 year-old grandfather balked at the price of a new battery for his car. As the salesman rattled off all of the batteries many features and benefits, Grandpa stopped him at the 7 year warranty. “I’m 97! What do I need a 7 year warranty for?” Wondering whether or not we’ll still be around to reap all the benefits of any particular deal is a universal reaction, especially when it comes to clean energy.
With Installed Solar Systems, Homes Sell for More
The average person stays in a home for 7 years. Even though payback periods on solar energy systems are generally 4 to 10 years, system lives of 20+ years leave consumers wondering if they are leaving cash on the table if they move.
- Research by the U.S. Department of Energy’s (DOE) Lawrence Berkeley National Laboratory finds that homes with solar photovoltaic (PV) systems sell for a premium over homes without solar systems. The research finds that California residents who installed home solar power sell their homes at a premium – an average home sales price premium of approximately $17,000 for a relatively new 3.1KWH PV system (the average size of PV systems in the Berkeley Lab dataset). This “solar energy” premium is more than the average cost of installing that system.
- The Appraisal Journal estimates that for every $1 saved in energy costs, the value of a home increases by $20.
- Additional studies have shown that homes equipped with clean energy systems sell twice as fast and at a premium of 3%-4% over similar homes in their neighborhood
These findings demonstrate that even homeowners who are planning a move in the foreseeable future can still reap the financial benefits of a solar energy system. And because adding a clean energy system is apt to make your existing home sell more quickly and for more money, it should make it easier for you to move where and when you want to move. In fact, it actually increases your mobility!