Is Solar a Good Investment for Residential Homes in Canada?
Should Canadian homeowners invest in residential solar arrays?
A look at the return on investment for residential solar energy arrays
Home and condo owners who have invested in solar arrays have much to look forward to; lower hydro bills, a smaller carbon footprint and higher home values. These advantages come at a high initial investment that should have you carefully calculating potential gains.
That’s because the expected return on investment for solar arrays will vary from province to province as subsidies and incentives change, and even from one home to another as your orientation to the sun determines the efficacy of your array. Here’s how to discover whether an investment in solar energy is right for you.
Can you Sell your Renewable Energy?
Some provinces allow residents to sell their green energy to the grid and make an income from their solar arrays. In Ontario, for example, homeowners who install solar arrays are able to sell electricity back to the grid at above-market prices under the micro-FIT program. This program is currently under review and potential investors will have to wait until July when the new 2016 rates will be disclosed.
Rates and Incentives
Each province has its own incentives and rebates for home and condo owners who invest in renewable energy. You can use the government website here to see incentives offered in your province.
Once you have determined the rebates and incentives available to you and whether you can earn money from your solar system, you need to check the suitability of your home for a solar array. Have a few solar companies check the location and orientation of your home and the suitability of your roof so you can see how much energy a solar array would provide.
Solar professionals will either visit in person or use satellite imagery to see whether your home has a good southern exposure. While this is the best option, east and west-facing roofs can also be rewarding.
The pitch of the roof is also significant (25-50 degrees is ideal) and shade can be a problem. Shade from trees, chimneys, adjacent buildings and plumbing stacks can affect the suitability of your roof.
All of these factors are taken into consideration when calculating how much energy your roof can produce and that will determine the return on your solar investment.
Rising Cost of Electricity
The good news is that, with the rising cost of energy, solar arrays will be a worthwhile investment even without incentives or subsidies. Research by the Canadian Solar Industries Association (CanSIA) has found the recent drop in the cost of solar panels and the rising price of hydro will balance out by 2020.
CanSIA president John Gorman; “There has been a 50-per-cent drop in the price of residential solar already. We’re going to see continued drops over the coming years, and that means not only diminishing subsidies, but an actual payback starting in five years’ time.”
Gorman went on to say that by 2025, it will even be economically viable for homeowners to install battery systems for solar power storage so they won’t have to use municipal power at all.
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