We’ve had several folks contact us recently after noticing higher than expected utility bills. You’re not imagining things, either: electric utilities throughout the region are raising utility rates.
From January, 2021 to January, 2023, residential and small business rates have jumped several times with increases totaling about 50% here regionally. That’s a big jump in just a couple of years!
Here at Baseline Solar, most of our customers decide to go solar because of the environmental benefits. Saving money and insulating yourself from future rate hikes are just some of the additional perks of adding solar to your home or business!
So, how does solar save you money on your electric bills? Savings come through the wonders of net metering! Net metering is a billing system that allows solar energy system owners to return any excess energy to the grid, “banking” it for future use. As your system produces electricity, that energy is first used to supply your home’s energy needs. If your system’s output does not cover all of your energy needs, your utility will provide the remainder. Conversely, if your system produces more electricity than you can use, the excess is measured at the meter and sent back to the grid to be used by other customers. Full credit is given for every kWh of solar electricity added to the grid, and credits are carried forward from one bill to the next.
By having solar, you can offset up to 100% of the electrical needs of your home or business.
That means that you can see electricity bills as low as $9/month–and many of our customers do just that!
What happens when the cost of electricity rises, like we’re seeing now? Consider the following hypothetical situation: homeowner Jane Dough installed solar in January of 2021, and has a system large enough to offset 100% of her annual 10,000 kWh usage. Since she is producing enough electricity to offset her entire bill, Ms. Dough is completely insulated from electrical rate increases as they occur. She doesn’t even notice them!
What’s not hypothetical is that In 2021, Appalachian Power rates were ~$0.10 per kWh. Jane Dough would have saved $1,000 in 2021. In 2022, these rates increased to ~$0.1233 per kWh, bringing her savings to $1,233. Most recently, Appalachian Power increased their rates to ~$0.15 per kWh. Our hypothetical homeowner Ms. Dough would save at least $1,500 this year!
As you can see, solar becomes an even better investment as utility rates increase. What does this mean for you, if you don’t have solar?
It means that this is a great time to consider adding an array to your home or business! Financial incentives like the 30% Solar Investment Tax Credit (ITC) are an excellent motivation as well.
If you have any questions about utility rates, how solar can save you money, or if you’re ready for a free estimate, get in touch today!