Solar Energy is becoming more affordable now with huge rebates and tax credits on Solar Electric Systems. Bringing the cost down to where you can break even in six years, while adding resale value to your home.

I just recently attended a seminar on solar electric panel installation at a local establishment of a nationwide home improvement chain. The host was very knowledgeable, courteous and friendly. She was very willing to answer all our questions in detail. I learned a lot there and I want to tell you about it.

In this article I will give a quick tutorial of Solar Power and how it may completely eliminate your electric bill. Then I’ll explain what the rebates and credits are, and how they affect your final cost. I’ll also be talking about the proper method of installation, so you can determine if your situation is favorable to using solar panels. And finally, I’ll describe how to read your electric bill and compare the cost savings when using solar power.

Solar Power can completely eliminate your electric bill. Some people incorrectly think that it will reduce your bill. No. With the improved technology of solar panels, and when installed correctly, as I’ll explain later, you will not be paying anything to your electric utility. For that matter, many times your own solar panels will be creating more electricity than you use, and that will feed backwards into the power grid, making your meter run backwards. This is perfectly legal. They want it that way. However, the power company will not send you a check for the power you feed them. But most states require the electric company to credit you on your bill. That’s right, your bills could have negative amounts due. This is known as Net Metering. That means that even if you are not in the best location for efficient solar power generation, you will be able to take advantage of the sunniest days, and draw on the reserve you accumulated, on those dreary cloudy days, and of course at night.

By the way, solar panels work more efficiently the colder they are. So they actually perform very well in the winter months even though the sun is low in the horizon.

At night, or on cloudy days, when your solar panels are not functioning, you will be drawing power from the electric grid and, in essence, using up your credits. So you can think of the grid as your storage unit for excess power that you can use later on. Technically it’s different from using batteries for storage. They don’t actually store it for you. They supply it to your neighbors who pay for the excess power that you generate. Then when you need it, you get it from the grid.

So what are solar panels anyway? The scientific name for them is Photovoltaic Material, or PV. There are three different kinds of PV. They can be made from Single-crystalline Silicon, Polycrystalline Silicon, or Thin Film Copper Indium Diselenide.

Silicon is an element that becomes electrically charged when sun light rays hit it. Rays at a right angle (90º) will produce the best charge. If the sun’s rays fall on a panel at an angle, the voltage will be reduced significantly. For this reason, it is recommended that panels be place on roofs that are facing south. Since the Earth’s axis is at a 23.5º angle, the sun’s rays will be coming from the south during the winter months. Of course I’m referring to homes in the Northern Hemisphere.

Okay, enough of that tech talk. Now I’m going to get electrical on you.

One solar panel creates 6 to 24 volts DC, depending on the angle of the Sun and interference such as clouds or shade from trees and buildings. It is best to avoid the possibility of these disturbances. A competent installer will indicate if your situation will benefit enough by using solar panels on your roof.

In order to get 120 volts, solar panels are wired in series. Voltage adds up serially. There is an inherent problem with this arrangement, but there is no other solution. If one panel is blocked by shade, it will considerably reduce the total output. Just like a flashlight that has one dead battery. Even if the others are good, the current doesn’t flow as well. Another analogy is with Christmas tree lights wired in series. If one bulb is dead, the whole string of lights goes out.

Another analogy is how batteries in series add up voltage. Four 1.2-volt batteries in a flashlight will power a 6-volt bulb. Solar panels add up the same way. But then the Direct Current needs to be converted to AC. We use 60 cycles AC in the US. The unit that does that is called an inverter. The final component that you need for a complete system is a battery. The battery holds the charge to provide consistent voltage to the inverter. The inverter not only changes it to AC, but also steps up the voltage to 120 volts. Two inverters in series are used to produce 240 volts. Alternatively, a transformer can be used to step up the 120 to 240.

The inverters have a 10-year warranty and the solar panels have a 25-year warranty. You need to check with your own supplier for the exact terms they may give you.

Solar panels are only 15% efficient, but don’t let that number confuse you. It is already taken into account to get a total installation on your house that will provide 100% of your electric needs. Not long ago, the technology was good enough to convert only 8% from the rays of the sub. So the technology has already doubled in capacity. And new technology is coming along all the time. That Copper Indium Diselenide that I mentioned earlier actually has an efficiency rating of 17.7%, according to the U.S. Department of Energy Photovoltaics Program.

Why do the Government and the local electric utilities want you to get independent of the grid? Creating electric power by present means adds CO2 to the atmosphere. This may be contributing to global warming. Power plants are increasingly adding to air pollution. Solar power does not create air pollution.

What about when the day comes that the solar panels have lived their useful life and are discarded. Isn’t that going to end up in our landfills? For one thing, there are no moving parts with the solar panels, so not much can wear out. So the comparison to present carbon based energy pollution weighs highly in favor of solar electric power.

You thought I’d never get to this. I’ll give an example of the costs of a typical solar panel installation for your home, using the figures from the provider who gave the seminar I had attended.

If you live in the Northeast United States, these prices will be accurate. Otherwise they are still useful as a guide. Prices vary across the country from various solar panel companies. And some panel manufacturers offer rebates as well. It's important to check with your local suppliers and compare.

Say you have a 500 square foot roof area that faces south and is sunny all day with no interference that can cause shade. Thirty solar panels will cover this area and will produce 5700 Watts of power. The annual output will be 7125 kilowatt hours (KwH). If your electricity is costing you 22 cents per KwH then this is a savings of $1,603 per year. If your Electric Bill averages out to $133 per month, then you are free of the grid.

Take a look at your electric bill. There are basically three charges you need to add together to find your total cost per KwH…

1. The Power Supply Charge. This is the cost of the electricity.
2. The Delivery Charge. This can be close to the cost of the power, doubling what you thought you were paying.
3. Taxes, don’t forget taxes.

There are no delivery charges for Solar Power that you create with you own equipment. There are no taxes either. It’s your own power!

Once thing to understand is that you should stay on the grid so that your excess power feeds backwards into the grid. Therefore you will always have power when your solar panels can’t produce. Remember what I said before, you will be simply using your own credit that you got when you fed the excess power into the grid. So if you have enough panels, you may very well never pay your electric utility again. But the thing to understand is that they will still charge you for the meter connection to the grid. That is a small daily fee. Here on Long Island, LIPA charges just .18 per day, so nothing to be concerned about.

Getting back to our example. If we are installing 30 panels to cover a 500 square foot area to produce 7126 KwH per year, that costs $45,030.

Now for the good news, LOOK at these CREDITS (I am using the data for Long Island, NY, but you may have similar credits and rebates)…

1. NYS Energy Income Credit: $5,000
2. Federal Investment Tax Credit: $7,524
3. LIPA rebate: $19,950

How did these work out?

1. The NYS Energy Income Credit is 25% of the contract price, but it is capped at $5,000. Unlike a deduction, the credit comes off your amount you owe in April, dollar for dollar. Your own state may very well be offering a similar credit.
2. The Federal Investment Tax Credit is 30% of the contract price and it has NO cap on installations through December 31, 2016.
3. I’m not done yet. Your local Power Utility may give you a rebate. The Long Island Power Authority (LIPA) is the local power utility on Long Island. I included that as an example. If you live on Long Island, these numbers are accurate for you. If you live elsewhere, check with your utility for any rebates they may be offering. For example, on Long Island, LIPA is giving a huge financial assistance to effect a 40% reduction in the retail price.

After all these credits and rebates,

the net cost is only $12,556.

That includes parts and labor!

Licensed contractors install solar Electric Systems. You can find providers near you by searching for “Solar Products Dealers and Services” on the Internet on in the Yellow Pages.

Solar dealers will evaluate your home and determine if Solar Power is right for you. The provider who gave the seminar I had attended, actually uses Google Earth to do a preliminary study of one’s home to determine if their roof is slanted to the south (as is required) and to see if any trees or other buildings are creating too much shade. But then they need to come out to the home in order to do a thorough investigation. At that time you can go over your questions and discuss your concerns about trees, shade, etc.

I even asked if they would run a new electric line from one side of the house to the other, since my south slanting roof is on the other side, far a way from where the electric line comes in. They said that there were cases where they included that in the published price quotes. But an on-site review will be required for a final commitment.

If you plan to stay in your home for at least six more years, you will break even by then. But even if you sell sooner, the added value of having a Solar Electric System may be more than recovered with the additional sales value.

Another way to look at it, is to compare the investment in solar power to that of buying CD’s or other investments. Since the break even period is six years, that is equivalent to earning 12% on your investment. Where else can you safely get a return like that?

Getting information from local providers doesn’t cost anything. Go to your nearby home improvement store and ask when and if they will be having seminars hosted by local Solar Electric Providers. You’ll come out of it with a wealth of knowledge, like I did.

Emails to the author are welcome via HubPages.