You stand in a better position to enjoy several outstanding benefits if you install a photovoltaic power system (PV System) in your single-family home. Examples of these benefits include higher home values, low electric bills, and lower carbon footprints.
However, the above benefits come with enormous maintenance costs and installation costs. Besides this, the extent of the returns can differ widely from one home to another. In this post, you’ll get tips on how to calculate the cost of photovoltaic power systems for a single-family home.
Let’s get started!
Calculating The Cost Of PV Systems For A Single-Family Home
Power generated from a solar panel is capital intensive. Besides this, the primary cost of having solar power comes upfront whenever purchasing the system. The solar system will nearly represent the most significant single element of the total expense.
Other systems vital for the installation are an inverter, various housing components, wiring gear, cables, and metering equipment. The inverter plays a critical role in every PV system. It converts the DC voltage generated by the solar panel into AC Voltage used by appliances in your house.
Battery storage is another thing most homeowners consider. Historically, batteries are known to be prohibitively expensive and unnecessary. Also, remember to factor in the labor cost.
You can theoretically evaluate the cost of a PV system for a single-family home using the discounted cash flow method. Here, outflows at the start of the project can be the installation costs. The inflows arrive later via offset electricity costs, including through net metering and directly.
Levelized Cost of electricity
Instead of using the discounted cash flow method, you can determine the viability of a PV system. You can do this by finding the LCOE (“Levelized cost of electricity”) and then comparing the results to the electricity cost requested by the local utility.
You can calculate the “Levelized cost of electricity” as the cost per kilowatt-hour. Here, you use a format that’s similar to the one you always find on electricity bills.
Use the equation highlighted below to get an approximate ” Levelized cost of electricity:”
As per the assumptions, the PV solar module’s useful life is 25 to 40 years. The ownership cost includes the maintenance expenses, which you need to discount to get the NPV. After this, you need to compare the LCOE with the electricity cost from a utility. Note that the relevant price refers to the price that comes into place near or during peak photovoltaic solar production.
Pros & Cons Of PV Systems For A Single-Family Home
Like several other systems, photovoltaic solar systems also have their advantages and disadvantages. These include:
Pros
- It relies on green energy, hence lowering the carbon footprint
- It gives you access to some tax breaks
- Net metering makes it easy to back extra energy produced
Cons
- High maintenance and installation costs
- Photovoltaic systems work only in the presence of the sun
- The system parts require replacement after every few years
- Some tax breaks may be expiring or have expired
Final Thoughts
Hesitate no more! It’s high time to use the above tips and start calculating the costs of photovoltaic systems for a single-family home. Before installing a photovoltaic system, you’re likely to hesitate, but it’s pivotal to note that this is a long-term investment. Also, a PV system is an excellent option in many cases when viewed from a financial perspective.
Installing photovoltaic systems requires you to dig into your pocket. However, having one in your single-family home is the correct path to follow. With photovoltaic solar power, you’ll avoid future potential energy cost fluctuations or lower carbon footprint.
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