Learn about the incentives, benefits and drawbacks in cloudy Washington state.
Washington state's coastal areas are notorious for clouds and rain. Do solar panels make sense? With rising power bills and new financial incentives, they might.
While Washington residents pay some of the lowest electricity rates in the country, the rates have been slowly rising over the years. Some of the largest public utilities in the state, including Puget Sound Energy, Avista and municipal utilities, increased electricity rates for the customers late last year.
The state's 100% clean electricity goal and the 2021 Climate Commitment Act will further increase the role of renewable and clean energy sources, including solar, in power generation.
Can solar panels save you money?
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Given the combination of state and federal solar incentives and utility rate increases, it's worth considering installing a solar system to reduce your energy bills and maintain price stability over the long term.
Here's a look at the average cash price for a 5-kilowatt system before factoring in tax credits incentives, according to data from FindEnergy.com.
|System size (kW)||Price per watt||Total cost|
You have a few routes to go solar in Washington. Choosing what's right for you will depend on your circumstances.
Cash: If you purchase a solar system with cash, you immediately assume full ownership. You will avoid any interest or loan fees associated with taking out a loan. The federal residential clean energy credit can help you recoup some of the high upfront cost of your investment (details on that below). Consider saving up for your future solar panels in a high-yield savings account.
Solar loans: If you don't have cash to pay for solar panels, but still want to own them, taking out a solar loan is the next best option. These loans, typically offered by your solar installer, are another option that is still eligible for the federal tax credit. Keep in mind that interest and fees can lead to higher costs over time.
Other loans: You don't have to borrow money from your solar company or the partner they recommend. You can also pay for solar panels -- and get the full federal tax credit -- with loans from banks and other lenders. That includes home equity loans and home equity lines of credit, which are secured by your home. Be careful: If you don't pay back a home equity loan or HELOC, your lender can foreclose.
Leasing: If you lease, you sign a long-term contract with a solar developer. The developer will install solar panels on your property and charge you a monthly rate (it's like paying rent) for using the energy from the panels. Unfortunately, you won't get any government incentives since you don't own leased panels. As the owner of the panels, the solar developer will receive all the incentives.
Power purchase agreement: With a power purchase agreement, a solar developer installs solar panels on your property and charges you a fixed price per kilowatt-hour for the energy generated by the panels. Like solar leasing, the company supplying electricity to your home through a power purchase agreement retains ownership over the solar panels and takes advantage of all government incentives.
While investing in solar isn't cheap, it's worth considering full ownership of a solar system by buying or financing it since they often save the most in the long term. If you buy your panels, the average payback period is estimated to be between six and 12 years. If you can't afford solar panels, a lease or power purchase agreement could be an affordable alternative
Washington residents have several solar incentives to save thousands when purchasing residential solar panels. The residential clean energy credit, a federal solar tax credit program previously known as the investment tax credit, is one of the most important solar incentives available for American homeowners. This credit lets you claim 30% of the cost of a solar system from your federal income taxes for the year. While the credit is available until 2034, it will drop to 26% in 2033 and 22% in 2034 and terminate in 2035, unless renewed.
You can receive the clean energy credit by filling out and submitting form 5695 (PDF) to the IRS. Go over the IRS instructions on how to complete this form. After the IRS approves your documents, your solar savings will appear as a credit when you file your federal tax return. The credit will lower your tax burden and give you a higher refund.
In addition to the clean energy credit, Washington residents can take advantage of a few state incentives.
|Net metering||Washington's net metering policy allows solar owners to send their excess solar generation back to the power grid and get credits on their electric bill at their utility's retail value.|
|Solar easement laws||The state's Solar Easement and Rights Laws allow you to voluntarily sign a solar easement agreement with your neighbors to ensure your solar panels have access to sunlight. The laws limit the ability of homeowners' associations to ban solar panel installations on a resident's property.|
|Solar tax exemption||Washington offers a 100% sales tax exemption on all solar systems of up to 100 kW and labor costs pertinent to solar installation. You can claim the sales tax exemption when filing your state tax returns.|
The Solar Energy Industries Association counted 153 solar companies operating in Washington, including 46 solar installers. Here are some of the best solar companies you could consider as you contemplate solar.
Based in Seattle, A&R Solar installs solar panels, batteries, and EV chargers for residential and commercial customers. It also provides energy monitoring services. The company begins its installation with a home energy audit to assess your energy use and identify your energy-saving goals. According to A&R Solar, its in-house experts will review financing options and all incentives before installing a solar system. The company doesn't offer solar leasing or power purchase agreements. A&R Solar says you will get 10-year performance, 10-year quality of work and 10-year free equipment replacement warranties on top of a manufacturer warranty of up to 25 years.
Blossom Solar is a full-service solar and battery installer based in northwestern Washington state. Before installation, Blossom Solar experts will conduct an energy audit of your home, help you design your solar system, manage all the required paperwork and local permitting, and organize the final inspection with your city officials. The company states it gives a 25-year product warranty and a 10-year quality of work warranty. It doesn't offer a solar lease or power purchase agreements.
Blue Raven Solar is a residential solar panel installer servicing 17 states, including Washington. According to Blue Raven Solar, it's a full-service solar company handling everything from sales to installation and providing tailored solar offerings to meet customer needs. The company offers a financing option called BluePower Plus+, which provides free payments for the first 18 months. With Blue Raven Solar, you get a 10-year quality of work and a 25-year manufacturer's warranty. Currently, the company doesn't offer solar leasing or power purchase agreements options. Blue Raven Solar gives customers $250 for each referral it receives.
Puget Sound Solar has been in the solar business for 20 years. The company installs solar panels, batteries and EV chargers for residential and commercial customers. It also provides 24/7 monitoring of your solar system. With Puget Sound Solar, you get 10-year performance and 25-year quality of work warranties. The company partners with Puget Sound Cooperative Credit Union, Generations Credit Union and Verity Credit Union, offering its customers zero-money-down financing options.
SunPower has been manufacturing solar panels since the 1980s. Listed as CNET's best solar company, it makes some of the most efficient and durable solar panels. The company also installs solar panels for residential customers via its large group of SunPower-certified installers. With SunPower, you get 25-year product, performance and quality of work warranties. The company gives you the option to purchase a solar system with cash, finance it or enter a solar power purchase agreement or leasing contract. Its financing branch SunPower Financial offers solar loans to underserved communities at reasonable rates.
Before going solar, it's good to consider whether potential constraints outweigh the benefits of installing solar panels.
Roof condition and pitch: A roof's pitch can play an essential role in determining the cost of a solar system. See if your roof has the right pitch to maximize solar production. Based on the US Department of Energy's calculations, an angle between 15 and 40 degrees is ideal for panel performance. Consulting with a professional solar installer will help determine if your roof needs repair or replacement before installing solar panels.
Insurance coverage: Incorporating your solar equipment in your homeowner's insurance policy is an excellent way to add more protection to your system. Call your insurance company if your policy would extend to the solar system. If it does, remember to add your solar panels to your insurance after installing them.
Commitment vs. time: Before you commit to solar, calculate how long you will live in your home. Buying or financing a solar system or signing a lease or power purchase agreement are long-term commitments. If you move in a few years, you may not fully realize your solar investment.
Solar panels undergo rigorous testing and are designed to withstand harsh conditions, including strong winds, rain and snowfall. Locations with severe weather conditions often provide specific installation instructions to ensure solar panels' secure and safe placement. While most solar manufacturers give 25-year product and performance warranties, the panels can last many years beyond the warranty period with proper care.
Yes, it can be worth going solar in Washington. Solar panels produce power using direct and indirect sunlight, which means they still make some electricity during cloudy days. However, their generation capacity will be much lower when it's overcast. Rain has its benefits -- it improves the production of solar panels by washing away dust and dirt.
Typically, the installation of solar panels doesn't lead to an increase in your homeowner's insurance premium. However, every insurance company handles solar panels differently. Therefore, it's worth checking with your insurance company if solar panels will impact your insurance premium and by how much.