Many solar shoppers are motivated by utility bill savings. Often, homeowners realize they are wasting a hundred or more dollars a month on electricity with nothing to show for it long-term. Thankfully, installing solar panels will dramatically lower your power bills. But, will solar panels completely eliminate your power bill?
Although going solar dramatically lowers utility bills, it doesn’t necessarily eliminate them for grid-tied solar energy systems. The exact reduction depends on the size of your roof, along with your home’s total electricity consumption.
How to read your electric bill
For many Oregon households, electricity bills are confusing to decipher and consist of many lines. The rate of power depends on how your power company bills you. Sometimes, this even fluctuates by the time of day. Many people just look for the total without understanding how the bill is actually calculated.
Your Portland Gas & Electric or Pacific Power bills have three main components: a supply charge, a transmission fee, and a distribution fee. The charges are applied similarly to ordering take-out food to be delivered to your home. The supply charge varies depending on how many items you order. The transmission and distribution charge depends on the delivery fee.
On your utility bills, the supply charge depends on how much electricity your home consumes, and it is measured in units called kilowatt-hours. If your solar system generates as much energy as your house uses, you can eliminate the supply charge on your bill. However, you cannot eliminate the transmission and distribution fee if you remain connected to the power grid, even if you install home solar panels. This fee typically ranges between $8 and $15 a month depending on your utility company.
A kilowatt-hour is enough energy to power a 100-watt light bulb for 10 hours or a 50-watt fan for 20 hours. In Oregon, the average household uses 916-kilowatt hours per month, and our average electricity bill is about $100. In Washington, the average family uses 969 kilowatt-hours of power.
The exact price for power depends on the rate from the utility company, which varies by the provider and their rate structure. Portland Gas & Electric charges about 12.4 cents per kilowatt-hour. Pacific Power charges between 10 and 24 cents per kilowatt-hour. Both utilities offer optional time-of-use rates, which means that the electricity costs more during times of peak demand and less during off-peak demand.
This rate schedule encourages utility customers to consume power during off-peak times when possible. In our experience, some households are more flexible than others, so it doesn’t always work well for all families. Some homes naturally don’t use a lot of power during peak times, while others do.
How much will a solar system reduce my power bill?
If your solar energy system produces as much power as your home uses, you can eliminate the supply charges and pay only the connection fee for the utility grid. However, if your solar system is undersized, you will not zero out these charges.
At Smart Solar Energy, we strive to size your solar system to provide the most value to your family. We customize each project based on your energy needs, goals, budget, and property. We can even take future changes into account. For example, if you plan on purchasing an electric vehicle, we can account for that when we size your system.
When we create your solar proposal, it includes projected energy calculations. These estimates use historical weather data and take shading from trees or other buildings into account. Thus, you will have a good idea of how much you can lower your electricity bill even before the PV panels are installed on your roof. We take pride in providing accurate calculations because we take customer satisfaction seriously.
To find out how much you can save with solar energy, contact us today! Our free solar audit will provide an accurate look at your estimated solar savings and system cost.
How does net metering work with the utility company?
Many Oregon utility companies have a program called net energy metering or net metering. Your utility provider will compensate you at the retail rate for the solar energy you feed to the grid.
For example, on a sunny day, your solar PV panels may generate ten more kilowatt-hours of electricity than your home is consuming. However, at night, your system isn’t producing anything, so you consume those 10 kilowatt-hours. You can then use your banked credits to power your home at night or on cloudy days. The surplus solar and the nighttime energy use cancel out to zero.
Therefore, your home will always have power after going solar, except during power outages (unless you have batteries). If you deplete your solar credits, you will not be left in the dark. It just means you will have supply charges on your electricity bill.
If you don’t use all your solar credits for one month, you can bank them for future use. However, most solar credits do expire after one year. Therefore, we do not like to oversize solar systems because you will have solar credits expiring without getting compensated for them.
Will my solar system produce all the power my home uses in a year?
Typically, we try to size a photovoltaic system to produce your average annual consumption, but never any more than that. Regardless, the Smart Solar Energy team will let you know what is possible during our proprietary solar audit, so there will be no surprises. We value educating our prpsective customers so you can make informed purchasing decisions. In fact, our existing customers often tell us that their solar system is performing better than expected.
Unfortunately, not all properties have excellent solar energy potential. For example, if trees or other buildings heavily shade your property, your roof might not be large enough to produce all your own electricity. However, solar panel efficiency has increased dramatically in the last decade or two, which helps. We can also install high-efficiency solar panels that can produce more electricity in a small area.
In some cases, we can install solar panels in other locations besides the house roof. For example, garage roofs and ground mounts are appealing options in some cases, but ground mounts typically cost more due to the additional racking system, permitting, and installation costs.
How do I take advantage of net metering?
To qualify for net metering, you will need to have a bidirectional meter on your home that can track both the power you draw from the grid and the surplus your solar system is supplying. This requires filing paperwork with the local utility company.
Smart Solar Energy completes all the necessary paperwork to take advantage of net metering. Our goal is to make it simple and easy for you to go solar. To learn more about going solar, contact us today for a free audit.
If you are not connected to the grid, you cannot qualify for this program. Thus, off-grid properties with solar energy systems are not eligible for net metering.
How much will I save on my power bill?
Your solar savings depend on the amount of your bill, the size of your roof, and the prpsective shading in and around your property. Our average customer saves about $1,000 per year on their energy bills at today’s rates. However, electricity rates tend to go up over time and almost never come down. So, if you save $1,000 at today’s rates, you will likely save double or triple that every year in the future.
Smart Solar Energy installs systems designed to produce clean, renewable energy for 25 to 35 years. In fact, we offer an industry-leading labor and service warranty for 25 years! Therefore, installing a solar system with us is a very low-risk investment.
You know the sun will shine, although this does vary a bit by the daily weather. You also know your home will continue to use power, and your electricity rates will likely continue to increase over time. You can also trust Smart Solar Energy to install a solar system that is installed right by true solar energy experts. Our installers have extensive experience designing and installing solar systems throughout the Pacific Northwest.
Our solar energy systems also include solar energy monitoring. This enables homeowners to view historical and real-time solar energy output. Therefore, with just a few clicks, you can see how much clean energy you are producing and quickly know if an issue does develop so that we can resolve it right away.
If I go solar, will my home be net-zero?
A net-zero home produces as much renewable energy as it consumes. If there is sufficient space on the roof for solar panels and not too much shading, your home can be net-zero. Some solar homeowners even try to switch as many loads to electricity as possible to rely only on renewable energy.
For example, they might install an electric water heater, clothes dryer, and range instead of natural gas or propane models. Likewise, energy-efficient heat pumps can be an excellent way to heat and cool your home without relying on fossil fuels. And, an electric vehicle reduces or eliminates your gasoline consumption.
I installed solar panels but consume more power than I produce. How can I change this?
Unfortunately, not everyone that has solar panels can virtually eliminate their power bill. Is your property heavily shaded? Has your electricity consumption changed since sizing the solar system?
We certainly love trees at Smart Solar Energy and appreciate all they do for cleaning the air and providing wildlife habitat. However, in some cases, trimming a tree or two can dramatically impact your solar system’s output. If this is your case, it might be worthwhile. Unfortunately, there is rarely anything that can be done about shade from other buildings or trees in your neighbor’s yard.
If your roof is quite shaded and you do not have power optimizers or microinverters, these technologies can help mitigate the impacts of shading. Both options can be installed afterward and can significantly reduce the production losses from shading. Basically, they allow each solar panel to operate independently, so shading on an adjacent panel doesn’t impact the one next to it.
Another option is to look for ways to reduce your electricity consumption in the home. For example, do you have energy-efficient light bulbs and appliances? Do you have a power-hungry appliance, such as a refrigerator, that is driving up your electricity bills? If so, it might be worthwhile to swap it out for an energy-efficient model.
If you have an electric water heater, installing water-saving faucets and showerheads can help lower your electricity bill while conserving water. If you use a lot of air conditioning, consider other alternatives like increasing the temperature setting a bit or using a fan instead when possible.