# What is the return on investment of a solar system

February 8, 2019 | 4min read

Calculating the return on investment of a solar system is fairly straightforward. First, trace back what you’ve paid for electricity over the past year. That number will represent your potential annual savings for going solar. Then, divide the cost of the solar system after any eligible incentives by that number. The result will tell you how many years it would take you to break even. Anything you earn beyond that is money that stays in your pocket. The trickiest part is finding the cost of the solar system. That cost varies widely; it’s based on the size of the system you need, minus any incentives that are offered federally and in your state.

## Calculating the return on investment of solar: A hypothetical scenario

An average home needs a solar system that produces about 5 kilowatts (kW). A system that size typically costs between \$25,000 – \$35,000 before incentives. After incentives, that cost may drop to as low as \$12,000 to \$15,000. The average electricity use for US households is 11,000-kilowatt-hours (kWh) per year. As of November 2017, the average electricity rate in the US was \$0.1301 per kWh. That pencils out to an average cost of \$1,430 per year for electricity. For a \$12,000 system, you’d break even in 8 years and 4 months. For a \$15,000 system, you break even in 10 years and 6 months. Thus, the hypothetical average homeowner can expect to break even in 8 to 10 years.

Nearly all home solar power systems come with 25-year equipment warranties. Even with a 10-year breakeven period, the hypothetical homeowner above would receive roughly a 150% return on their investment. The only risk to the homeowner is losing those savings if their system breaks down and they aren’t aware that it stopped working. With most solar companies, you don’t know your system has stopped working until you receive an unusually high utility bill and you don’t recoup those costs.

But not with Freedom ForeverTM. We guarantee your system’s performance for 25 years. If it ever produces less power than we guarantee, we reimburse you for the lost savings. The Freedom Forever performance guarantee is your assurance that you can see a return on your investment. All you have to do is make sure your system doesn’t get shaded by trees or other obstructions and keep your solar panels clean. Typically all you need to do is hose them off when they get dusty.

## How the Freedom Forever 25-year performance guarantee works

Once your new solar power system is activated, we monitor its performance. If it ever stops working or produces less than the promised amount of power, we will notify you and schedule a time for our service team to come out and fix it. We will then reimburse you for any lost savings. Freedom Forever is the only solar power company that reimburses you for the savings you’d lose if your system does not meet the annual performance guarantee.*

## Solar power is a great investment, plus it shields you from electric rate increases

As shown above, your return on investment for solar power would be around 150% if your electric rates stayed the same. But they don’t. Electricity costs rise an average of 2.9% per year, so the power your system generates increases in value every year! With a home solar power system, rising utility rates simply aren’t your problem anymore. Your Freedom Forever solar power system protects you from rising utility rates while giving you a solid return on your investment.

## Going solar is easy with Freedom Forever

All you have to do is call us at 800-685-1850 or click here to get started and one of our customer care representatives will take it from there. They will put you in touch with a Freedom Forever authorized Independent Dealer who will explain all the details of going solar. Once you’ve made the smart choice to go solar, we’ll contact you to plan your system and get the installation process started.

We keep you in the know throughout the installation process using our unique customer care portal. You can use it to track the progress of your project, ask questions, and see how much more work is left until the day you switch your system on to start making your own electricity from the sun.

### Go Solar. Guaranteed Savings. Call 800-685-1850 today or click below to get started.

*Subject to terms and conditions of your agreement.

References

Solar Energy Industries Association. (2019) Solar photovoltaic technology. Web. 2 Jan

Center for Sustainable Energy. (2018) How much does a typical residential solar electric

system cost? Web 2 Jan 2019 https://energycenter.org/solar/homeowners/cost