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Posted: 6:00 a.m. Monday, Sept. 30, 2013

Installing solar energy at home is hot

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By Clark Howard

ClarkHoward.com


Are you paying too much for your home's energy expenses? Putting in solar energy can help lower that bill.

Residential solar installations are expected to be up 50% year over year. A small number of states with pro-solar laws account for a big chunk of that growth. They include states like California and Arizona, where the sun is friendly to you, and then New Jersey, which may seem odd, but the laws in the state are favorable to solar.

In many other states, the power companies have used their influence to stop residential solar installs from happening. That shows the power of corruption in state legislatures.

But the reality is solar has become economically compelling. Panel cost has dropped quickly after many technological breakthroughs.

You should consider solar only if you're planning to stay in home for 7 years or longer and you have a clear shot of the southern sky.

It's possible that there may be no upfront install cost if you do what's called a power purchase arrangement (PPA,) where you pay a flat monthly fee for equipment and the energy you generate. In a surprise move, Honda is now offering customers and would be customers in 14 states a real deal on installing solar at their home.

One thing to note: Installing solar with a power purchase agreement does create a drag when you sell your home, because a buyer has to qualify for both a mortgage and the long-term PPA on your panels.

Having said that, the savings are extraordinary if you have the right situation. We save a fortune on solar at my home. For me it's all about ROI; the environmental thing is just a side-benefit.

Read more about solar energy on pages 147-151 of my new book, Clark Howard's Living Large for the Long Haul.

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