Solar 101: What's your Solar IQ?

For many homeowners facing rising electricity rates and growing concern over increases in carbon emissions, solar power is increasingly looking more favorable. However, unlike the traditional grid system that provides energy to homes, allowing someone to simply flip on a light switch to get power, utilizing a residential solar system involves having a basic understanding of what is needed to install and maintain the array.

Although there is a slight learning curve involved in installing and maintaining a residential solar system, there are many benefits once you complete the process. These include considerable savings on energy bill and the satisfaction of knowing you're contributing to reducing harmful pollutants and emissions that threaten our environment. With a simple primer in Solar 101, you can boost your solar IQ and generate significant savings over the life of the solar system.


Surging in popularity

As people across the country and world continue to learn about the many goods offered by generating their own clean, renewable power, and as panels become more affordable, reliable and durable, residential solar systems will continue to grow in popularity. Already, home-based solar systems are surging in popularity and experts only expect this trend to continue.

The Solar Energy Industries Association's Solar Market Insight Report 2016 Q2 revealed that residential PV is up 34 percent from Q1 2015. Further, after growing 66 percent between 2014 and 2015, residential PV installations are expected to add 2.8 GW during 2016.

After all is said and done, the National Renewable Energy Laboratory said that rooftop solar panels could potentially generate nearly 40 percent of electricity for the country. When combined with other clean, renewable energy sources like wind power, the U.S. is poised to be in a position to dramatically lower our reliance on traditional sources of power, like burning fossil fuels. As more homeowners continue to add residential solar systems to their houses, they'll continue spreading the word about the savings involved, potentially prompting their friends, family and neighbors to follow suit.


Basic components

While it's not necessarily imperative that homeowners know all the technological intricacies of exactly how a solar panel operates, a basic understanding can assist in choosing the right products, laying out the array and maintaining a high level of efficiency throughout the lifetime of the panel.

For starters, residential solar energy technologies incorporate photovoltaic materials and devices to convert sunlight into usable electricity. The basic component of a PV material uses a cell made of silicon. However, since a single cell only generates approximately 1 or 2 watts of power, engineers string these together to create a solar panel or module. These strings of cells are then sandwiched between glass to protect the integrity of these fragile components against the harshness of the elements they'll be exposed to for the next 20 to 30 years.

When sunlight shines down on these solar panels, the cells soak up the energy stored in the sun's rays and convert this energy into direct-current electricity. However, DC energy is not suitable for powering everyday home appliances, so a solar systems requires a power inverter to convert DC energy into AC power. Once the energy has been converted, it's ready to be used on your everyday household appliances.

Along with the panels and inverter, there are also cords and wiring needed to carry the clean, renewable energy to the house. Collectively, all of these parts necessary to run and operate the solar panels are collectively known as the balance of system. In addition to these, the BOS may also include a battery to store reserve energy, but these are not necessary for the average residential solar system.

Once you have a handle on the basic components that comprise a residential solar system, the next step is to begin identifying the best layout design for the solar array.


Solar system design and layout

It's not simply enough to merely toss a few panels onto your roof and call it a day. There are still a few additional steps that need to be taken before installing the solar system.

The first phase is to work with a qualified and experienced installer to discern the most effective way to lay out the solar system to avoid potential problems like shading. It's important for the solar panels to receive as much sunlight as possible. Any trees, chimneys or other impairments will obstruct the amount of sunlight shining down on the panels, thereby limiting the potential for energy generation and prolonging your ROI.

The orientation and tilt of the solar panel will play a major role in how much sunlight it receives. In addition, some rooftops might not be as accommodating for solar panels as others. Thankfully, companies like AuroraSolar provide digital rooftop mapping software that provides visual demonstrations of the best possible solar system layouts for residential rooftops.

It's important to check with your local municipalities to learn whether there are any building permits needed for the work on the house. Similarly, if you live in a house that is subject to the jurisdiction of a homeowners association, make sure there are no covenants in place that might restrict your ability to install a solar system on your home's rooftop.


Tax incentives

Purchasing a solar system requires an upfront investment that pays off over time. For some homeowners, this initial cost can potentially be prohibitive. Thankfully, there are ways to lower the initial costs of purchasing solar panels.

Everybody loves a tax break. In an effort to incentivize homeowners to purchase solar panels, the U.S. government is offering a tax break for people who purchase and install these systems. First implemented in 2006, the solar Investment Tax Credit lets homeowners take advantage of a 30 percent tax credit for residential solar systems. This program has contributed to a compound annual growth rate of 76 percent for both residential and commercial solar installations.

The ITC works as a dollar-for-dollar reduction in the income taxes of a homeowner who purchases and installs a solar panel. The 30 percent level goes through 2019, and after that the ITC drops to 26 percent in 2020, 22 percent in 2021 and then drops to zero after 2023. Although this tax credit has been renewed several times in the past already - most recently in 2015 - there's no guarantee the government will continue to extend the exemption, so it's best for homeowners to take advantage of the savings sooner rather than later.

By lowering the initial cost of the solar system, this decreases the overall price and helps ensure that you can generate a faster return on investment, thereby creating even more savings in the long run. The ITC has proven to be one of the federal government's most important incentives for increasing the deployment of solar panels in the residential space. Many experts anticipate the recent multi-year extension enacted in 2015 will only further drive down the price of residential solar panels, while simultaneously boosting installation rates and technological efficiencies.


Net metering

In addition to the tax incentives provided by the federal government, homeowners with solar panels can potentially generate even greater savings by selling extra energy back into the grid at wholesale prices. Called net metering, this is a billing system that credits owners of solar energy systems for any electricity they feed back into the grid. For instance, if a homeowner spends all day converting sunlight with a solar panel, but then does not use all of the energy collected, the home's electricity meter runs backwards, and provides a credit against what energy has been used.

According to SEIA, those end users who use net metering, on average, send about 20-40 percent of their solar system's output back into the grid. This method allows customers to gain greater control over their electricity bills. Unfortunately, not every state currently allows net metering, although there are many industry spokesmen and academic studies supporting the benefits of this pricing mechanism, which may potentially increase its popularity.

With this basic introduction to Solar 101, you should be in a great position to get started on installing your own residential solar system.


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