Are solar panels worth it as a PEC customer?
Why is it that so many PEC customers are installing solar panels in 2020?
So many people are installing solar because they realize how much solar could save them. A solar system installed in Texas is likely to save customers $40,000 in power savings (over 25 years).
Right now is the perfect time to install solar. The incentives surrounding solar are phenomenal. The 26% solar tax credit essentially makes solar 26% cheaper come tax time. Net metering is another great incentive which allows PEC customers to use the grid as a prefect free battery.
How does PEC net metering work?
Solar arrays will at times produce more energy than the home can use, depending on time of day and electrical load within the home. When this happens, the excess energy is exported into the grid. Full Net Metering awards a 1 kWh account credit for each 1 kWh exported into the grid. This credit can then be exchanged for 1 kWh of power imported from the grid.
Net Metering effectively allows you to use the grid as a limitless battery for the solar energy generated by your solar system. The excess energy is sent to the battery (the grid) and the battery “charges up” (gains credits for each kWh). The battery can then be discharge (exchange credits for kWhs). Net metering economically “stores” energy for later use. In this way full net metering enables customers to eliminate the variable component of their usage bill.
For an average PEC customer owning a single family home and with a power bill of $184 per month the gross cost for installing a 10.41kW solar system is $23,943, which is $2.30 per watt. Upfront incentives (including the 26% federal solar tax credit) reduce this cost by $6,225 making the net cost $17,718.
See your solar panel installation cost from your local solar companies around Texas
What are PEC Net metering rates?
Until your bill is reduced to zero, you’ll be credited the full rate for the energy you generate. If you generate more power than you use during a given billing period, that amount will be credited the net energy credit rate, which is our fuel cost with no capacity component. Our current net energy credit rate is posted on the right.
As of May 1, 2018 the net energy rate is $0.0465 per kWh.
How much will solar panels save the average PEC residential customer?
The savings will vary depending on how much your power bill is now, the specific PEC rate plan you are on and how suitable your roof is for maximum solar generation.
If I enter the details for a PEC customer that has a power bill of $184 per month into the best online solar panels calculator it tells me that I need a 10.41kW solar system that will produce 14,153 kWh's per year and that this system will likely return the owner a $72,649 profit even after repaying the capital over 25 years.
Zero-down financed solar system estimate for a PEC customer
Monthly savings year one $58
The graph above shows the savings for this customer in the first month that their solar system is live. It assumes that the system is purchased via a 100% loan product.
One of the common reasons why people have been slow to install solar panels, despite the excellent financial return they can provide, is that often the first months savings may not appear to be enough to motivate them to go through the process of buying solar. However, it is important to realize that solar savings grow over time as utility prices increase. As can be seen in the graph below, the solar saving are quite considerable when totalled over the 25 year life of the system
The overall lifetime profit will be even more with a cash purchase of the same system. The difference being that we have included the cost of interest in the lifetime savings summary below.
Zero-down financed solar system cash flow
|System Size||10.41 kW|
The above cash flow projection assumes a solar system that offsets 100% of power usage, a finance rate of 3.99%, a financing period of 20 years, a minimum utility charge equivalent to 10% of bill without solar, and a utility cost inflation rate of 4.5% p.a.
What is the average payback period for residential solar panels for an PEC customer?
The payback period for an PEC customer installing solar panels on their roof at home depends on their power usage prior to installing solar, the finance method they choose to pay for their solar system and the size of system they install. What we have done below is copy an extract from our PEC solar panel savings calculator which shows the payback period for a typical PEC customer. You can visit this calculator above and enter your own current power bill to see your solar savings and your likely payback period. You'll note that for customers with larger monthly power bills the payback time is usually slightly shorter because the cost of solar systems per watt usually reduces as the system size increases.
See your savings and payback period based on your electricity use and location in the PEC territory
Estimated system size 10.41kW (100% usage offset)
Pay Back Period
Est. Cost/WattEstimated Cost Per Watt
(after 26% tax credit and local incentives)
Annual Power Generation
Your total savings over the life of the system are estimated to be $72,649
|Estimated south facing roof space required||694 sq-ft|
|Levelized cost of power from this system over 25 years||5¢ cents/kWh|
|System cost reduction by upfront incentives||-$6,225|
|Average cost of utility power over 25 years (if you don't get solar)||28¢ cents/kWh|
|Equivalent Return on Investment (IRR)||14.8%|
|Monthly Savings year 25 (for 100% energy usage)||$529.20|
System prices are estimated based on the average reported cost of systems installed in the past year. Pay Back Period and Equivalent Return on Investment are calculated based on a 100% cash purchase. Estimated Cost Per Watt is calculated after claiming all applicable incentives. This estimate assumes you are able to take full advantage of potential tax benefits.
Cash Flow graph - Cash Purchase of this system
Renewable Energy Property Tax Incentive
100% of cost of solar system not included in property taxes.
CPS Energy Net Metering (San Antonio)
Net metering is available to all customer of CPS Energy
Residential Renewable Energy Tax Credit
Please keep in mind that the best source of up-to-date information on incentives are the solar installers who specialize in your area. If you still are unsure about the eligibility criteria of some of the solar incentive programs, please discuss with the solar installer representative who may contact your shortly, or visit the solar incentives discussion forum where the most common questions are likely to have already been answered.
Detailed information about your estimate
|System Size (for 100% usage offset)||10.41 kW|
|Annual Power Generation||14,153 kWh|
|Pay-back time (assuming Cash purchase)||7 Years|
|Internal Rate of Return (IRR) on Investment||14.8 %|
|Total Upfront Incentives and Rebates||-$6,225|
|Net Cost of System after rebates and incentives||$17,718|
|Total Cost of Utility Power Avoided over 25 years||$98,394|
Please note that the investment return figures do not include the possible increase in property value.
What are the environmental impacts from PEC customers installing solar panels for their home?
While most home owners ultimately decide to install solar panels because of the financial savings they offer over time, for some people it is the environmental impacts of this choice that drive the decision. Here is a break down of the environmental benefits typically delivered by the installation of a 10.41kW solar system in the PEC service territory..
A solar system generating 14,153 kWh per year will save you money AND make the world a nicer place
on average per year
Reduces CO2 emissions
metric tons per year
Equivalent to planting
Equivalent to driving
less per year
CO2 emissions calculation based on the electricity generation and emissions data for your state in 2015 as published by the US Government Energy Information Administration.
Are solar panels worth it for PEC residential customers?
Yes. Absolutely yes.
In Texas solar has a payback period of 8-9 years. After the payback period the solar panels will have paid for themselves and continue to produce free power for about 17 years. Solar installed in Texas is likely to save $40,000 or more over the lifetime of the system (25 years).
Calculating the cost involved in solar can be complicated, especially when; Inflation of power prices, energy production and local/ state incentives are taken into account. Thankfully, this calculator takes in all the variables and gives accurate and personalized solar estimates.
Here is a monthly and lifetime solar estimate for the same customer used above that has a $184 per month electric bill prior to solar and who installs a 10.41kW solar system.
How much power do solar panels installed in the PEC territory produce?
Texas is a sunny state so solar panels produce a lot of power. For example, a 10 kW system in Dallas will typically produce 13,753 kWh per year. That’s about 1,146 kWh a month. If you use more electricity than that you can always get a bigger system to cover your usage.
If you use 1,146 kWh or less electricity per month, and install a 10 kW solar system. You could have a monthly electricity usage bill of $0.
See power production and also get pricing from local solar companies
How much does solar panel installation cost in Austin?
The cost of installing solar panels in Texas will vary with; brands of solar panels and inverters you choose, the installation company you choose to do the install, the relative ease or difficulty of installing solar panels on your home, and of course the amount of solar panels you need to cover your electricity usage.
Texas has a very competitive retail solar installation market with many solar installer companies fighting hard for your business. This is why it's important to shop around and research solar companies in your area. The best way to check out if your choosing the right company to install solar is to read reviews of solar companies in Texas.
It is common to see really good systems, using good brands of equipment being sold for around $3.60 per watt before state and federal tax credits for cash sales.
However, the average cost of a solar system in Texas in 2018 is $3.68 per watt which for a standard 5kW residential solar system costs $18,400 before the federal tax credit and $12,055 after the tax credit is received.
Who are the best solar companies that service my local part of the PEC territory?
As the PEC territory covers a number of cities there are different solar companies operating locally in each.
If you are up to the stage of wanting quotes from solar installers you can get a system sized for your house and up to four quotes from installers that service your area for free online by entering your zip code below.
See my solar panel installation cost from your local installers
Find solar companies that operate in your area. Here is a list of the solar companies that work in the PEC territory.
How much electricity will solar panels produce where I live?
How do I get an accurate solar quote that takes into account my home and my power usage?
To get accurate solar quotes you (or your solar company) needs to work out how many solar panels you need on your home. To do this they need to know your power usage patterns. This will allow you to come up with the amount of solar panels you would ideally want to making your power bill zero.
This article explains ways that you can get hold of your power usage data either for your own analysis or to share with a solar company that you wish to have quote your home.
Once you determine the right amount of solar panels you then need to measure your roof to see how many panels will actually fit on your roof. Most solar companies can measure roof spaces online using tools that are similar to Google Maps (but are more accurate).
The www.solar-estimate.org website is the leading solar marketplace in America and allows you to both do an accurate online estimate of your needs and request quotes from solar companies through one interface.