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formerlyGDaisy09

I'm going to start this off by saying my MM brain may not be working so well on this one...

This summer we NEED to put a new roof on our home, we live in northern New England (there are still multiple feet of snow in my yard), and the roof on the house is 25 years old, asphault shingles. We have met with a roofing company, and decided that we're going to put metal standing seam roof over the existing shingles rather than ripping up the shingles and replacing with new asphault. the price tag on the is $6300, which we can pay in cash from our savings, tax return, and the savings bonds i mentioned in a different post. 

Tied in with this, H and I have always discussed putting solar panels on our roof to be more "Green" and generate our own, sustainable power, one of the things on our list when we bought the house was that the roof faces due-south and if we cut down a couple trees on the south-east corner of the house it gets full sun, all day.  After Federal and State incentives (which expire in 2016) the cost of adding solar to our home is $9,000, we do not have the cash for this, but if we finance through a HELOC our minimum monthly payments would be about the same as our electric bill (my thinking is we're accomplishing one of our goals, eliminating one of our bills, but then replacing it with a different one.)  If we do this project after 2016 the price tag will be about $18,000. 

The ideal time to add solar is at the same time that the roof gets done, the solar needs the roofing company to install some clips on the standing seam, if they coordinateo to install the same day the roof gets done it's quick and easy and no extra cost to us...if we do it later we have to pay the roofing company (or a roofing company) to come back.

is now the time for us to go solar?

brij2006

I personally would not because I'm anti-debt.

It will decrease your electricity bill, but usually does not completely eliminate it.

Instead, I would save up to do this project before the incentives expire.  Also, maybe you could get an estimate for having the roofers install the clips when they do the roof, then you will have those ready for when you do purchase the panels.

Lastly, I would only do this if you plan to live in the home at least 10 or more years.  Otherwise you may not see a ROI from the initial cost.

maple2

If you are committed to getting solar panels, then it sounds like this would be a good time.  Even if you have to take out a loan, the $9000 you save as a result of federal and state incentives will certainly compensate for any interest you have to pay.  Would you be able to save enough to pay for the installation in full before the incentives expire?  How much would the re-visit by a roofing company cost?  If you could pay in full before the incentives expire and the cost of the extra visit is low, you might save money going with that option.  Personally, I would go ahead and do it all now if the savings were not substantial just to simplify the logistics.  My time is worth something, and being able to coordinate 2 projects at once would be worth some extra cost.

The only caveat I would add is to make sure you could afford the loan payment on top of your electric bill and everything else.  Our neighbors who have solar panels still have to pay for electricity some months depending on weather conditions.  We live in a fairly cloudy area, though, so that may not be a concern for you.

Erikan73

I agree with PP, if solar panels are something you for sure want to do, and you plan on staying in this house for a long time, I would go for it. Sometimes the long term savings is worth the larger upfront expense.

formerlyGDaisy09

Thanks, both of you. The quote on the solar came with an estimated ROI of 9-10 years, we're not sure about staying in the house that long, so that is a good point.  from a sustainability stand point we'd decrease our carbon footprint by about 4000 lbs of CO2/year, so that is worth something. 

you are right, we'd have an electric payment some months, my grandfather has his home about 45 minutes from us on solar, the electric company pays him $20-30 a month in the summer and he has to pay a $10-$15 bill generally from november until march. 

We are planning this project for August/september of this year...just to have a little more time to save, but for the quotes to hold we need to make down payments on the roof ($630) and the Solar ($1000) now...so we'd need to make sure we have approval for a line of credit now as well. By the time we get to the end of the summer I'll be making an additional $460 a month (raise built into my contract), so the monthly payment (and paying the loan off faster) should not be a problem. 

Xstatic3333

I would be tempted to do it for the timing, and I also really want to put solar on our future home.  However, I might hold off just because I know you mentioned things in your budget are really tight right now (correct me if that's changed).  A HELOC, even a very manageable one, would make me nervous during a cash-strapped time.  The worry would not be worth it to me.  I'm not anti-debt entirely, but I am anti-new debt at bad times.  HELOCs in particular make me nervous for some reason.  I know they can have good interest rates, but I'm scrounging so much to save for equity right now that I think I'll be loathe to part with it once I have it.  

hoffse

I probably wouldn't do it.  But I'm also not super green.  I'm not anti-debt, but I feel like what you get for taking on more debt needs to have pretty significant value (whether financial, lifestyle, health/safety, etc.).  Obviously solar energy saves money, and if it's something you care about then you might find them to have more value than I do.  For me, personally, solar panels would not be worth taking on additional debt.

Something else to consider: how visible will they be to the street, neighbors, etc?  I personally find solar panels unsightly, and I would actually be less inclined to buy a house that had solar panels on it, despite what those panels might save me in utilities.  It depends on how well they are hidden and whether there are any street views of them. As a future potential buyer I would also be concerned with whether I would wind up spending a lot of money maintaining them.  I don't know enough about them to know if you can just take them off without damaging the roof when they die.  But it's something I would think about, and it would make me pause.

short+sassy

I had solar panels put on my house last July, but with a very different scenario from you. In my area, it is much more common to "lease" solar panels.  I don't own them and I did have to agree to allow the company who put them on my roof to get the tax write offs.

The upside was I didn't have to finance anything.  I pay $35/month and am locked into that for 6 years.  After 6 years, THEY are locked into the same $35/month I'm paying for the next 14 years.  In other words, I can call them at any time after 6 years to take them off my roof and we're done.  Or I can just keep them as long as I pay $35/month which will never go up.  At the end of the 20 years, I can buy them outright if I want to for a few hundred bucks.

The other upside is because they own the panels, they are responsible for insuring them, fixing them, and maintaining them.

The savings you have will obviously vary by household and location.  I live in the Deep South.  Winters, not too bad.  Summers, like one of the first circles of Dante's hell.  The panels save me at least $100/month mid May-mid Sept.  $20-$40/month in spring and fall...so not much savings when you consider the $35/month fee, but at least it comes out about even.  And then about a $50-$75/month in winter.

Supposedly, they do add value to your home, but I think they are too new a concept for anyone to really say that.  And of course it is usually the companies installing them who say that, lol.

Something else the industry doesn't like to admit.  They actually aren't very environmental at all.  It uses far more energy to fabricate solar panels than they will ever save during the course of their lifetime, which is usually 25 years.  

They don't damage the roof at all and are easy for a company to take them off. In fact, they will actually protect the part of the roof they are covering. 

hoffse

OP, I think if you can do what Short+Sassy is describing, that might be the best way to do it.  It sounds like a win-win-win.

I would bet the value thing depends on region.  I'm also in the deep south, and I just rarely see them around here.  They're just these unknown panel things that "green people" (tongue in cheek) install    I would bet in a place like California, or maybe the Southwest where it's sunny (and hot) pretty much year round, it absolutely does add value.

What is your electric bill like in N. New England?  In the south it can get pretty high in the summers because A/C is all electric.  But is your heat gas or electric (or some other thing I'm unfamiliar with)?  I have electric heat too, and that's been higher than average this winter, but still not over $120/month (for my apartment, not a house).  That's about what my electric costs in the middle of summer with the A/C running all day long.

I can't believe you still have snow.  I'm in Alabama.  I just went outside in shorts and a t-shirt.  It's glorious.

JoanE2012

hoffse said:

I probably wouldn't do it.  But I'm also not super green.  I'm not anti-debt, but I feel like what you get for taking on more debt needs to have pretty significant value (whether financial, lifestyle, health/safety, etc.).  Obviously solar energy saves money, and if it's something you care about then you might find them to have more value than I do.  For me, personally, solar panels would not be worth taking on additional debt.

Something else to consider: how visible will they be to the street, neighbors, etc?  I personally find solar panels unsightly, and I would actually be less inclined to buy a house that had solar panels on it, despite what those panels might save me in utilities.  It depends on how well they are hidden and whether there are any street views of them. As a future potential buyer I would also be concerned with whether I would wind up spending a lot of money maintaining them.  I don't know enough about them to know if you can just take them off without damaging the roof when they die.  But it's something I would think about, and it would make me pause.

This!  We passed up a couple of houses as soon as we saw the solar panels.  Sorry, I just think they're ugly (especially when they're not put down in any kind of pattern) and really take away from the house.  

Xstatic3333

I think it is one of those polarizing things. In my area (southern New England) they increase home values. My area does tend to be more "green," for lack of a better word. (I fall into this category myself but hate the term Go Green! for some reason. I want it to sound more practical). They're aesthetically neutral to me.

I'll have to research the energy costs and benefits before adding them to any of my future homes. Thanks for mentioning that short and sassy. I do see a value in diversifying our energy sources even if no net energy is saved, but if they're manufactured using fossil fuels and only last 20 years I'm not sure it's worth it to me.

My boss is having them installed, and by her math she brakes even after five years given her state's tax credits. She doesn't have electric heat, and most of our area just uses window AC in one or two rooms, but electric bills go way up in the winter in our area for some reason anyway. Maybe supply costs?

formerlyGDaisy09

Wow! thanks for all the feed-back! 

That's a good point about them maybe turning buyers away from the home. I think, like the rest of New England, the majority of people are interested in green initiatives, Northern New England is kind of "hippie country" everyone here is into organic gardening, installing rain barrels to water their gardens, most people own hybrid vheicles or subarus (the unofficial car of New England), people join CSAs, have chicken coups attached to their homes, recently there has been a big push to have homes, especially older ones, evaluated for heat loss and then "tightened-up" to decrease energy waste in the form of heat loss, similar to solar this has economic implications in addition to "green" implications.  people will go so far as to install plastic films on their window frames for the winter to prevent heat loss through their windows. I did check in with our REA who helped us buy the house, she hasn't sold many homes with solar, but imagined that it would add value to the house based on what most her customers look for. 

The solar company estimated our annual savings on electric to be about $800, I think over the past year we paid the electric company about $900. our electric bill is highest in December, January, and February.  but it also goes up in June, July, and August. we do have central air, and we turn it on during those months because I have allergies to pollens and other tree-related stuff so opening the windows is a bad idea. 

Things are still tight for us, so glad that CC is taken care of (so our monthly needs are $700 less!)H is still job searching, though he's had about a dozen interviews in the past 2 weeks, and several are setting up second interviews, no one is in a rush to hire. Because there is still snow on the ground landscaping companies and seasonal work haven't started advertising any jobs yet (I could actually see part of my patio this morning! and it's melted from the garden next to the house and I can see tulips coming up!). 

We sat down together last night and looked at the proposal from the solar company, and we've decided that now isn't the time to take on the project.  as I looked more closely it turned out that they needed the full $9000 within the next week to hold the price on the panels (the company that makes the panels is having a sale and the quote is only good while they're on sale), their plan would be to store the panels until we're ready to install. I don't think, even with a HELOC that we can throw down $9000 in the next week. We may revisit it in the next year or 2 and figure out if it's something we want to do before all the incentives expire in 2016. As far as I know none of the companies lease panels, but that's a great idea!

formerlyGDaisy09

Just received this back from our contact at the solar company after I let them know that we decided that now was not the right time to undertake this project. not sure how applicable this observation in CA is to New England, but it is some food for thought. 

http://www.sfgate.com/business/article/Solar-panels-seen-as-boost-to-homes-resale-value-5063262.php

KatieCutie05

"The solar company estimated our annual savings on electric to be about $800"

Remember this is an estimate from the SOLAR company... not your electric company. The amount it will actually save you depends greatly on a huge variety of factors and i've found that every single place that tries to estimate "savings" with their product is exagerated and not accurate because they are salesmen and they don't know your exact situation and usage. They just want you to give them your money. So don't rely on that number. You can get the amount of energy that solar panel is expected to produce in your area (accounting for bad weather days and low sun days ofcourse) and then take that number to your electric company... and ask them for their estimate on what you might expect to save.

Solar panels are an investment. But you don't go into debt for an investment or the interest you pay and the monthly payments defeat the purpose and negate any "gain". its not going to eliminate your electric bill completely and not every month. for example you'd easily have a month of bad weather where the solar panels produce little energy - and you'll also have months where the solar panel produces a lot of energy because its sunny everyday and your electric bill will be lower that month. Save up cash and buy it then. Once you factor in the interest you pay by borrowing the money - you lose that "incentive savings" anyway. Save up and pay cash for it and i'd only bother putting it on if your going to stay in your house forever... or atleast the next 10-15 years because it takes time for the savings in electric to pay for the cost of the panels. If your worried about "resale value" of your home at all then it tells me you don't plan on staying there forever.

formerlyGDaisy09

Thanks @KatieCutie05, their "estimate" did come directly from our electric bill. and from their measurement from our roof that indicated that as it currently is solar panels would be 86% efficient on our roof.  

if we ever undertake this project at this house we would remove trees on the south-east corner of the house that would improve efficiency of the panels into the 92-97% range, so I trust that that estimate is just that, an estimate. 

That is basically the logic that H and I had in our discussion yesterday, 1. we're not comfortable financing the majority of the project, 2. we may not be in this house long enough to see a return on the investment, and 3. we would rather invest in this project in our forever home if #2 is the case. 

That said I do see some value in reducing our carbon footprint, but like @short+sassy said there is energy that goes into constructing the solar panels (I'd like to think that companies making panels approach it in a sustainable way...but who knows!).  There is evidence to show that in the case of hybrid cars it is not "sustainable" to trade-in a perfectly good car for a hybrid one because of all the greenhouse gasses created in the process of producing the new hybrid car, that buying a new hybrid is only sustainable if you are truely "in-need" of a new vehicle. 

but for now we can focus on other ways of reducing our carbon footprint, we have plans to plant about 320 sqft of organic vegetable gardens this spring (if the snow ever melts!) so we'll be cleaning the air and not driving to the store for produce.