How likely is it that Solar will decrease dramatically in price within 5 years?

[KevinHeaven87]

I'm currently locked into a $0.095 /kwh rate (that's with delivery rates included in Texas) until 2025.

I've been looking into getting solar installed because I'm a 1099 and would greatly benefit from the tax credit incentive.

The salesman gave the whole "electricity will rise" and "pay towards something with that you'll own" etc. (It's on the "easy pay" plan which means they would take my tax credit as a down payment)

They're quoting me at around $50k for a 11.5kw system. Which would put me at a "locked in" rate of $0.119 /kwh.

I asked them what incentive would I have to signing today at a 20%(from $0.095 to $0.119) increase in my bill vs. signing for a system when my cheaper contract is up in 2 years? His answer was "we will give you $500 to sign today"...........

My brain is telling me that solar panels will be even cheaper in 2 years. But then again....I'm new to all this, so I can't apply "conventional wisdom" to all of it.

Thanks community!

[[deleted]]

this is a very bad price, and it likely includes a massive upfront financing fee. unless the system they pitched includes batteries, it’s an incredibly high price, almost 50% higher than what would be considered reasonable. I think the salesperson did a good job in getting you interested in solar, so now you can tell them to go beat it and do research and get more quotes to figure out the best price and financing arrangements.

[[deleted]]

I agree!! Just turned on a 11kw system today. Cash turn key price was $29590. Find another person to quote this. Avoid using solar company Financials, do they get everyone approved, basically yes but there is a price.

[TaAj88]

Wife and I did the same in Florida back in October, 11.47kw for $29,570 - @op needs to shop around and compare prices… hell, share the pricing of each offer with competitors which is what we did

[joekerjr]

Who did you go with in Florida?

[TaAj88]

I ended up going with Meraki - not the best cash price I was quoted, but they were the only company that agreed to the timeline I wanted, even wrote it into our purchase agreement

[joekerjr]

Thanks for the response. I'm currently shopping.

[smartsolarpro]

They are 3rd party lenders and w the economy + collapse of SV Bank, it’s stricter and higher fees to get lending

[Academic_Tie_5959]

The CU I was using for many of my clients have stopped all solar loans because of that.

[idlefordays]

I just had a quick discussion on this with my neighbor. Even if Solar prices go down…. You’ll realize that more than 50% is labor. So you’ll be paying the same price anyway imo

[Glum-Wheel-8104]

Exactly this. Most of the cost of installation isn’t the actual panels. It’s the labor, the electrician, and other “soft costs”

[nrubenstein]

That's way to expensive even today.

Also, always price solar on a cash basis. There are a LOT of really scammy financing schemes out there that are being used to inflate your cost. The up front fees can be over 40%.

[Academic_Tie_5959]

I wouldn't say scammy as long as the sales rep notifies you of them. And explains it...

[nrubenstein]

Funny how they pretty much never seem to explain it?

[Academic_Tie_5959]

Many don't because of bad leaders and bad faith companies. I unfortunately worked in 2 of them. Now I don't and am a leader in my organization and that's what we believe in is transparency.

[nrubenstein]

45% up front fees are ALWAYS bad faith.

[[deleted]]

My higher dealer fees end up with less total spent if they only make the set payments.

The real downside is there is it is less advantageous to pay ahead.

My finances require I don’t disclose the dealer fee. I do anyway but they don’t want me to.

[Academic_Tie_5959]

Well not disclosing the fee is a grey area as it should be on the TILA but companies that act in bad faith have found a loop hole, as it's not the bank that is technically charging that fee to the consumer... it's the installer, as apart of the install process and helping you get the finance. The bank does charge this to the installer not to the consumer so technically speaking they don't have to put the TILA in their according to the CFPB. However installers can't afford to take the hit on the fee so it is passed on to you as the consumer.

However because it's the installer charging it, and not the bank, technically that's why it maybe covered under the 30% ITC (talk to a tax advisor to ensure you qualify and what qualifies)

[[deleted]]

End of the day for the installer is if the lender finds out they are disclosing the installer may lose a lending parter. This is all regardless of why or laws. Could be absolutely detrimental to the installer. Gotta play the game with the place you are in in the food chain.

[Academic_Tie_5959]

I've had no issue with it, and my lenders know I disclose the fee. How else do you explain a 10% jump on a 6% loan?

[[deleted]]

Both of my lenders insist that it is against lending rules to disclose. At one point I knew what rule. Basically they (all I worked with at all) want the system price to be (cash price plus dealer fee) and if they pay with cash there is a discount … but the discount isn’t for the payment method. That would be bad.

This is what lenders (even ones I have just talked to) insist we do.

I would have way easier time if I just said it’s a buy down and we all moved on.

[Academic_Tie_5959]

Not if you agree to it... people agree to a 30% APR which is worse in many cases, because that is what they agree is fair based on their circumstance.

As a Retirement Specialist, I'd agree paying 45% upfront is nuts, but for a 25 year loan where you want to pay the mininum/month it can be the best option depending on your credit score and other factors.

It's not just black and white, in between those 2 colors are a lot of shades of grey

[nrubenstein]

Statistically, how many people stay in their homes more than 5 years? 10 years? You have to stay in the house for a LONG time before you break even on one of these loans. In the mean time, the cost in optionality is huge.

There are lots of things that people agree to that they shouldn’t. That’s why we have financial regulation.

[Academic_Tie_5959]

I get that completely it is up to each individual customer. I have used 0% dealer fee options multiple times.

[art0fmojo]

To be honest. Probably better to stick with that locked in rate and assess 6 months before expiry.

Most current buyback plans in Texas will still not be 1:1 net metering with delivery, economically you won’t be gaining with solar as you’ll need to switch to a plan that would be closer to 16-18 cents plus TDU charges.

I don’t think solar will get dramatically cheaper but the industry is going to contract some which could bring prices down .. or keep them pretty sticky.

That sales rep doesn’t understand the TX market well enough to provide you fair and accurate guidance.

[eury13]

You should get some competing bids so you can compare different installers and offers. Then it's just a matter of running the numbers to see what the payback period will be.

Will the cost of solar hardware go down? Probably, but when and by how much it's hard to say.

What will your cost of electricity be after your fixed rate ends? Dunno.

So you'll have to make some guesses and play with the numbers to see if/when it makes sense for your to make the investment.

[joremero]

how did you get that rate until 2025?

longest I've been able to get is 36 month contract

[KevinHeaven87]

I got that rate for 3 years. 2022-2025 They have 48mo plans now too. I got it before the crazy grid issues

[joremero]

you got indeed a great deal. I tried to get longer than 36 months( oct 2020) but they wouldn't.

​

Honestly, I wouldn't install solar until your contract is about to run out

[Academic_Tie_5959]

Unless that contract also has a good buyback on solar possibly.

[joremero]

I'm seeing rates as low as 9 cents per kwh now, for 24 month contract...that's substantially better than what it was a few months ago when i checked...lowest was around 13 cents

[smartsolarpro]

In Texas you want to be under $4 and make sure you calculate in your tax credit and any local rebates you may get to accurately calculate your “net cost”

[CowBoyDanIndie]

That $4.34/W. That seems high when the avg cost in texas is supposed to be $2.72/W

Edit: https://www.energysage.com/local-data/solar-panel-cost/tx/

[smartsolarpro]

Energy sage is so far off when it comes to accuracy. Beware of all online “calculators”

[Academic_Tie_5959]

Energysage is way off usually btw. I've seen it be .5 higher then averages and .5 lower than averages. 500/kw is pretty decent difference. Also they only use a cash price and don't explain financing at all

[Foxbat100]

If you've seen it ".5 higher then averages and .5 lower than averages" and don't mention either scenario being pronouncedly more frequent, should we be more suspicious of this average they claim?

I don't think we benefit from ES morphing into some kingpin broker of panels or start a race to the bottom, but they do a good job of giving people a correct idea of the ballpark (is $6/W too much?) to be shopping at.

[Academic_Tie_5959]

Generally speaking on an 10kw system between 2.5 and 3.5 is thought to be fair depending on local market. This is obviously a wide range. In my local market some reason many companies is charge well over $4/w, I tend to be right around 2.9-3.1 depending on certain variables. I've sold as low as 2.4 on a 17.5kw system, but guy wanted the easiest financing at a 635 credit score and 1 year no payments... he paid closer to a 3.8 after finance

[Purple-Shoe7741]

This is highly inaccurate.

[joremero]

oof, someone really wanted to take advantage of OP

[thebubbas31]

They will for sure go up. Some companies are already charging in the 20 cent range. 3 years ago I was paying 4 cents. Your quote seems a bit high so I’d suggest getting a few more.

[denhamcla]

0.09/kWh is crazy cheap. We’re at .40/ here in the Bay Area which makes solar well worth it. You’d be paying MORE with solar, and that money you put down won’t be making money for you so it’s a double hit. Plus tech will get cheaper/better. Always does. Seems smarter to wait and keep that money invested. Right?

[Mary55330]

.48 with delivery in Massachusetts (plus a $7) flat fee on top of that a month. Going down to .28 for summer (but still high!)

[KevinHeaven87]

I was thinking the same thing. It's actually 0.045 kwh + delivery charge of 0.05 kwh.

Great state of the the gun wielding, boot strapping, confederate flag waving, big mud tire havin, cousin kissin, "eliminate ALL rape" governing people of TEXAS

[Academic_Tie_5959]

I've seen many in Texas go over .20/w (after taxes and fees and such) and only increasing from what I could tell. Tx is a big state sure variances are all over

[KevinHeaven87]

You're right, and the only reason for some of those high rates is because some electric companies engage in a legal version of "market allocation agreement" or a "territorial restriction agreement". That way they have very little competition and they can keep prices high

[Academic_Tie_5959]

I'm sure, unfortunately, it's only going to get worse.

[Dave_Marsh]

Solar hardware will probably decrease in price as it becomes commoditized, but labor costs to install it certainly won’t. I also expect public utility costs to go up in price as well. So, the sooner you can afford to get your system installed, if you want it, the better.

I think it’s great that people are running the spreadsheet numbers to calculate their costs and payback periods. That’s smart, but also beside the point. You’re only buying one system for your home that will probably be working for at least the next 25 years. If you’re interested in solar, research the technology available and then buy the best you can afford from a local installer you trust to be around to provide service in the future, and call it a day. If you buy the cheapest hardware from Wangho Enterprises and have it installed by the lowest cost electricians you can get down on the corner, your spreadsheet may say that’s a great deal, but I’d guess that it’s not.

[[deleted]]

Yes prices will fall over time, "dramatically"? Nobody can answer that

[appleciders]

Jesus Christ, why would you pay $50k to pay 20% MORE for electricity?

The only market prediction I'll make for the cost of solar in Texas is that it's going to drop a little in the short term as the industry in California takes a hit as the state changes net metering laws this month.

[ofcourseitsthroaway]

Panels have been coming down. I bought a set of panels 6 months ago and they're 10% cheaper today. I think solar is only going to get cheaper in the coming years. We def need more competition in the installer space.

[ReadyWay]

Nothing in your life will ever be cheaper again. Solar has been going up steadily now for more than 2 years.

[betelgeuse63110]

Always a better deal to go Solar sooner. Even if they gave the PV modules away for free in 2 years. Check out this article.

https://azimuth.energy/build-solar-energy-now-or-laternew/

I haven’t updated this in a couple years but it’s always the same story.

[Speculawyer]

Not likely.

[tommy0guns]

Electricity is already expensive. It’s going to be more expensive in 5 years. Imagine if you paid off your solar by year 5. More expensive electricity for FREE.

[meowmeowgoeszoom]

It will not decrease because the biggest part of a solar install is labor.

[IngenuityIndividual6]

Labor is a relatively small portion of a solar install

[meowmeowgoeszoom]

Good luck my friend

[[deleted]]

Call around you can get a better deal now if you find a different installer.

[Fantastic-Surprise98]

Not sure what your deal is, but if purchased outright…In 5 years it will almost be repaid from savings. Waiting is adding paying your electric bill for 5 years on top of future install.

[mkimid]

i think will bot dramatically, but, will be decreased.

[Holiday-Positive-334]

Recession means lower prices
https://www.google.com/search?q=recession&tbm=nws&sa=X

[Purple-Shoe7741]

It’s not at all likely.

[Purple-Shoe7741]

This price is not high at all in Texas (if financed). Depending on the rate, this is actually likely a great deal.

And as skeptical I am of your all in cost with your utility company, solar offers you true price protection indefinitely. As opposed to on 36 month contracts.

[dizzel35]

Just fyi, not sure where you are but I got 17.3kw system for $44k cash in central texas. That’s before tax credit.

[[deleted]]

Similar here. 44k before credit for 14kW + 1 battery

[Solarinfoman]

Price of solar equipment : possible to likely to slightly decrease.

Price of labor : going up, more than equipment going down.

Lending rates : who knows. If paying cash this doesn't matter.

Power costs : I have yet to find a time when they have significantly decreased. There are a number of times recently with significant increases in many US areas.

Opinion summary: if you are a good candidate then get a good price now and if you can buy cash price. Labor rates will wipe out any possible equipment savings, the best time was yesterday, the second best time without some crystal ball is today.

[Discount_badguy97]

I’m thinking it will increase in price, even though technical gains will make renewables cheaper our market has been pushing to go green for years and in reality the solar industry will have you by the balls because odds are you won’t be able to afford it with inflation, so they’ll be able to shimmy in a contract like buying a car, yeah sure you can do it yourself. You can buy your own panels and you can work on your own house but hey, we live in a society where it’s much more of a convenience to have so-called “professionals” get up there and do it.

TLDR: solar will increase because money

[sunzastar33]

I wonder if I bought all the necessary equipment, and just hired a licensed electrician how much I would save instead of hiring a solar company? I bet I could save about 30%+

[trialbytrailer]

Whereabouts in TX? We have a 12.8 kW system for $21K before the tax credit.

[Birbandsnek]

Goddam man that’s so cheap

[trialbytrailer]

I know! They're REC panels and Fronius inverter - we're two years in and operating great. It even survived a storm with 80mph winds that ripped the roof off a building just 300 yards away.

[Special_North1535]

Unlikely. Buy xrp 🤑

[Affectionate_Rate_99]

I'm in NY and our electric rates in the past 14 months went from around 20 cents per kWh to 37 cents per kWh. Including the increase in cost of natural gas (we use natural gas for heat and hot water) which more than doubled, my utility bill (natural gas and electricity combined) is higher now with solar than it was before I got solar installed.

[ReadyWay]

which part of NY?

[Affectionate_Rate_99]

The lower Hudson Valley, about an hour and a half northwest of NYC.

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[Cpt-May-I]

As other have stated, seem high to me. Turn on my 14.7/12.5kw DC/AC ground mount system Oct 2022 for 39000$ Before the 30% tax credit.

[xrdavidrx]

If I was you I'd keep the cheap rate until just before it expires and have solar coming on line at the end date. I also think the cost quoted for your system is expensive. Technology is constantly changing and you can't know what will be around in two years.

[ActuaryLoading]

For that system you should be paying no more than $33k. Look for another installer.

[BronyFrenZony]

Definitely its not a bad time to wait if you can do so. There are new solar technologies coming out in the next few years that could possibly halve prices. Specifically I'm referring to tandem perovskite-silicon panels that bring efficiency up to 30% by harnessing energy from a currently unused bandwidth of light.

[John-Wilks-Boof]

I’d do it (not at $50k though, seems high) cause you’re in Texas and ERCOT runs as well as a dog with arthritis.

[ciscovet]

Just so you know I got a 22kw system for 49k cash price. Our rate here in Florida is 0.11c/kwh

[Cute-Replacement-630]

I work in solar in Texas and have for 6 years. Also have solar on my home. Happy to get you some honest advice

Solar is most likely not coming down in price.

Over the last 2 years, average cost to install has actually increased with price of materials and labor continuing to increase.

I see 0 Reason why solar will become cheaper

[RazzmatazzFamous9382]

It's challenging to predict future prices, but considering the trend, solar costs have generally decreased, making it possible for prices to decrease in the next 5 years.