We try to keep consumers up to speed on trends and changes in the solar power industry. But solar markets vary so much by state, and sometimes even city, the information can be very broad. In this series of case studies, we’ll explore what going solar looks like in specific areas.
Don’t see your state mentioned? Check back soon for new additions.
Now, let’s talk about solar power in the state of Florida.
The Case for Florida Solar Panels
It’s called the Sunshine State for a reason - solar energy is plentiful here! We recently applauded Florida for its decision to allow solar leases. This new financial option makes right now an excellent time to add rooftop solar panels to your home. A lease typically allows homeowners to add rooftop solar panels with zero upfront costs, making it a possibility for many more people. Leases also allow customers to accurately plan their energy costs. Lease customers pay a fixed monthly amount based on their system’s projected energy production. Additionally, lease customers will have no monthly bill fluctuations.
Florida generates the bulk of its power from natural gas and coal.1 These are both relatively inexpensive, but they contribute heavily to pollution and global warming. And even though electricity rates in Florida are below the national average,2 residents can still save money by going solar. You don’t have to choose between the environment and your pocketbook.
Net Metering and Performance Payments in the Sunshine State
Florida has a strong net metering program, which is great if you’re looking to go solar. It allows you to offset all or most of your electricity costs with solar panels. Any excess power your rooftop solar panels produce gets sent to the grid and most Florida utilities credit their customers at the full retail rate for that power. Those credits roll over for 12 months, so when you need to pull power from the grid (at night, for example), the credits offset any new charges.
As an added bonus, the Orlando Utilities Commission will pay its customers $.05 for every kilowatt-hour that their customers’ systems produce. That includes the power they use.3 That’s in addition to the retail-rate net metering. Easy money!
Solar Installation Incentives and Rebates for Floridians
Florida residents who install rooftop solar panels are eligible for the federal Renewable Energy Tax Credit. It’s equal to 30 percent of the cost of a PV solar system (through 2019 with the credit decreasing through 2021). That’s a good-sized savings! Some solar providers will claim the credit. This will save you paperwork both on the application and your IRS forms and pass the savings on to you. Others will leave it for you to claim.
Rooftop solar systems are exempt from sales tax in Florida,4 which can save you hundreds of dollars upfront. Plus, the state offers a property tax exemption on the value the system adds to your home so you won’t need to worry about taxes going up.
Outside the city of Longwood, Florida doesn’t offer state-level solar rebates. Even though prospective solar customers probably want the state to do more to encourage solar development, Florida’s strong net metering policy does a lot to save solar customers money, even without the added state bonuses.
Return on Your Florida Solar Panels Investment
Let’s cut to the chase. Just how much can you save with solar in the Sunshine state? Of course, how much you save will depend on the size of your solar system and your electricity use. For example, the value of energy produced by a 5kW solar energy system in Tampa would be about $79 a month.5 With the payback period of 11 years, a customer could save about $8,500 over 20 years. Keep in mind, your system should last more than 20 years.
The extra money in your wallet is a great reason to go solar, but don’t forget to factor in the environmental benefits, too. You can’t put a price on knowing your power comes from clean, renewable energy and that you’re doing your part to clean up the air in your city. It’s a win-win.
Loans and Leases
The calculations and projections above are based on owning your own solar system, but you have other options in Florida, too. We’ll take a look at each (for more details, visit our Solar Plans page):
- Solar Purchase - this is the most straightforward. You buy your solar system up front, plain and simple.
- Solar Loan - similar to a solar purchase but you finance your system with a loan. If you use a loan to purchase your system, the savings you see will vary a bit based on your particular loan terms. Some large solar installers offer solar loans. Other providers will refer you to a third-party financial institution for a loan. Some homeowners choose to take out a home equity loan to finance their panels. Exploring more than one loan option can help you get the best rate for your system.
- Solar Lease - you lease the panels while your solar provider maintains ownership. You won’t own your panels or be eligible to claim the federal income tax credit. The savings should still be passed to you though. Your solar provider can claim those incentives and factor them into your monthly payment. Lease customers typically aren’t required to make a down payment so savings can be easier to compare than with a solar purchase. Just take the monthly payment specified on your solar bid and compare it with your average monthly electric bill. Keep in mind you’ll likely still have to pay a small monthly fee to your utility for grid connection and you may occasionally need to buy power from them.
More Energy Savings - EVs, Home Batteries and Utility Rates
There are even more ways to save with solar in the state of Florida. You can choose these products or programs when you have your solar system installed or add them later to maximize your clean energy benefits.
- Learn more about saving money (and improving air quality) with your own solar Electric Vehicle charging station in this Q&A with a Clean Energy Trailblazer.
- Add a home battery to maximize flexibility of when to use the power generated by your solar panels.
- Look into your utility’s Time of Use rates to find out if you can save money by switching to an optional rate structure. The flexibility you get with solar panels - especially combined with a home battery - can make it easier to choose when to use power from the grid.
Get the Figures for Your Home
The final word is this: Florida is the state for white sand beaches, Publix subs and rooftop solar! This post should give you an idea of how much you can save with solar. But the only way to know your specific savings potential is to get a solar bid tailored to your home and electricity use. Let us give you a free one! Get started on your quote.