Switching to solar energy is a big decision. One of the most common questions is: How do solar panels work with your electric bill? Understanding this is crucial to making an informed choice. When you install solar panels, you are essentially adding a new, clean energy source to your home.
However, instead of completely disconnecting from the grid, most systems remain tied to it. Thus, this leads to a unique interaction between solar production and electric bill.
However, the difference is in how much that bill will be. With solar panels, you are producing your own electricity. This offsets the amount you would otherwise have to buy from your utility.
Obviously, this can significantly reduce or even eliminate your electricity charges, depending on how much energy your panels produce compared to how much you use.
How Do Solar Panels Work with Your Electric Bill?
So, how do solar panels work with your electric bill? It is all about balance. During the day, when the sun is shining, your solar panels generate electricity. If they produce more energy than your home is using at that moment, the excess power is sent back to the grid.
This process is called net metering. Your utility company credits you for the electricity you send back, which can offset the cost of any electricity you need to draw from the grid when the sun is not shining, like at night.
However, the size of your solar energy system and your electricity usage play a big role in determining how much your electric bill will be after going solar. If your system is large enough to cover all of your energy needs, you could see a zero-dollar electric bill, or even a negative one during particularly sunny months.
Why? With net metering, you can earn credits that roll over to future bills. However, if your system only covers part of your energy usage, you will still have a bill, but it will be much lower than before.
What Factors Influence Your Solar Savings?
Several factors influence how solar panels work with your electric bill. These include your location, the size of your solar system, and your household’s energy consumption. In areas with high electricity rates, the savings from solar can be substantial.
The time of year also impacts how your solar panels work with your electric bill. During the summer, when the days are longer and sunnier, your panels will produce more electricity, which can lead to lower or even negative bills.
In contrast, winter months might see reduced solar production. This could increase your reliance on grid electricity, leading to a higher bill.
Potential Fees and Charges
Even with solar panels, you might still see some charges on your electric bill. One common fee is the customer charge, which is a fixed amount that covers the cost of maintaining your connection to the grid. This fee doesn’t go away with solar panels, but the other charges on your bill can be greatly reduced.
In some cases, especially in states with demand charges, your electric bill might include additional fees based on your peak electricity usage. Solar panels can help lower these fees by reducing the amount of power you draw from the grid during peak times, but they might not eliminate them entirely.