Solar panels?

[SolaSaint]

Hi All,

I'm considering buying solar panels for my house to reduce or eliminate our electric bill. We live in MO and our current electric company is offering rebates of up to 60% off the purchase. So if I needed a 50K system they would pay 30K, all I would need to come up with would be 20K and the Federal Gov is offering taxes breaks on this amount. However I hear that our Federal Gov also sends you a 1099 with the rebate amount so my taxes would be sky high for this year. I know this is a lot to swallow and my head is spinning. Anyone out there have any advice or experience in solar panels on the house?
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[Tim]

Two important things to consider:

1. Check the efficiency rating of the product.
2. Try to figure out your break-even timeline.

 

[VictorBravo]

Definitely check into the tax issue. Figure out what you would pay on $30k additional income--and make sure you check to see if you fall into the Alternative Minimum Tax trap.

A 50k system is a major undertaking. I trust that the price includes competent designers and installers. It may be that a 50k system would save you only 200 a month depending on your power use. If that is the case, figure out what what kind of loan you can justify on $200 payments, and that would give you a hint as to whether the 20k plus extra taxes you might pay would be worth it.

If it saves you only $100 per month, it's probably a bad deal. Only you, or a consultant, can run the numbers to be sure.

 

[Edward]

Solar is rarely cost effective, although the rebates may help. Keep in mind there are safety issues as well - they can make firefighting more difficult in some circumstances if they are roof mounted, and they may also constitute a fire hazard in themselves.

You might look at a natural gas generator for peaking if you have gas service and a smart meter.

 

[sevenzedek]

A solar panel system costing $25,000 (at cost) would cost about $25,000 to install. Even if you installed the system yourself and saved on the installation charge, it would take twenty years to make a return on your investment if your electric bill was $100 a month; hardly cost effective! Add batteries to the system and you're spending another $20,000 and the expensive and dangerous upkeep of them. The only way this solar panel idea would have the potential to save you money is if you do it before the tax incentive goes away. I think that happens in 2014.

 

[Edward]

http://www.azcentral.com/arizonarep...lar-tax-credit-irs-letter.html?nclick_check=1

Bottom line? Last sentence:

"This ruling is directed only to the taxpayer who requested it," the IRS letter said. "A letter ruling may not be used or cited as precedent"