The New York Times recently published an article about an analysis by researchers at the Lawrence Berkeley National Laboratory that compared the sales prices of California homes sold with photovoltaic (PV) systems versus those without. The report found “strong evidence that California homes with PV systems sold for a premium over comparable homes without PV systems” between 2001 and 2009.
As UrbanTurf has reported in previous articles, the value of adding solar panels to your home is two-fold – there is the overall year-to-year savings in your utility bills and then there is the value the panels add to the home if you plan on selling it (although the latter is a point of debate as solar panel systems have a finite life). What makes solar panel installation particularly attractive are the incentives offered by the Federal and DC Renewable Energy Grant Programs that reduce the payback time on the initial investment.
Grid tied photovoltaic system on the roof of 1824 R Street NW
Green DC Realty’s Mike Kiefer explained that, for the Mid-Atlantic region, a solar electric system will cost about $7 per watt and the typical DC home might accommodate around a 4-5 kilowatt system depending upon sun exposure and size (1,000 watts make 1kW). Approximately 5kWh (kilowatt-hours) of energy will be produced each day for each kW of panel installation which means on a monthly basis you can expect around 600-750 kWh of energy produced from a 4 or 5kW system. The calculation most commonly used these days is for every dollar you save in electricity use it adds about $20 in value to the home. So, $1,000 saved annually via solar panels translates to about $20,000 in additional property value.
In September of last year, UrbanTurf reader Matt Latham laid out the cost structure for the his 2.6 kW solar roof system. Below are the calculations:
- Total Cost: $20,000
- Fed Credit: $6,000
- DC Grant: $8,500
- Net System Cost: $5,500
- 20 Year Internal Rate of Return: 18%
- Payback: 4 years
- Additional improvement value: $8,500
Happy Earth Day!
See other articles related to: solar power
This article originally published at http://dc.urbanturf.com/articles/blog/solar_panels_affect_the_value_of_your_home/3368
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