The Pros and Cons of Rooftop Solar in 2024

Solar panels provide homeowners a unique opportunity to own the electricity that powers their home, instead of renting it from a utility. However, just like buying a home, solar is a long-term investment with many facets to consider.

So, we’ve compiled a list of the pros and cons of solar to help you decide if 2024 is the right year for you to jump on board.

Pros of Going Solar in 2024

The cost of solar is expected to fall in 2024

One reason to consider going solar in 2024 is that solar prices are expected to fall after a few years of rising.

Rooftop solar pricing is typically measured in price per watt (PPW). Residential solar prices plummeted for several decades until bottoming out at $2.92 per watt in 2019, according to the SEIA. However — like many other things — mangled supply chains during and after the pandemic and caused solar prices to rise from 2020-2023, as shown below.

The most recent figure from the SEIA has the average PPW of solar at $3.42. However, there are a number of reasons to believe solar prices will fall in 2024 and the years to follow.

These include:

• Untangling supply chains and the general easing of global inflation
• Massive investments in American solar and battery manufacturing plants
• Economies of scale as solar installations continue to outpace forecasts
• The adoption of software and automated processes to streamline local permitting

It’s no secret that a majority of solar panels are manufactured in China, and as of late 2023, module prices were down 42% from the previous year as a wave of new plants have come online.

Solar is a hedge against energy inflation

Energy inflation became a kitchen-table issue in 2022 with the national average price of utility electricity rising nearly 16% from September 2021-2022. Utility rates continued to climb in 2023 and are expected to keep climbing for the foreseeable future as the outdated central grid tries to keep up with fast-increasing electricity demand.

Installing solar panels allows homeowners to set a low and fixed price for the electricity that powers their home. For example, the cost per kilowatt-hour (kWh) for rooftop solar electricity is typically around 8 cents per kWh — less than half the cost of the average utility rate in the US (17 cents per kWh).

In other words, going solar gives you control and independence over your electricity rate — something you will never have with a utility.

Solar energy is much cleaner than fossil fuels

Solar energy is not only renewable, it produces far less greenhouse gas emissions per kilowatt-hour of electricity than fossil fuels.

In terms of lifecycle emissions — including manufacturing, operation, and end-of-life processes — rooftop solar is around 12 times cleaner than natural gas and 20 times cleaner than coal.

Rooftop solar is not only a means of drastically reducing carbon emissions, it has other environmental benefits as well.

For example, rooftop solar requires zero extra land and large-scale solar can be combined with agriculture (agrivoltaics) to increase crop and livestock production, and placed over bodies of water (floatovoltaics) to decrease water loss from evaporation.

Solar modules and warranties are lasting longer

As the lifespan of solar panels increase, so are the length of manufacturer and installation warranties. Most major solar manufacturers including REC, SunPower, and Panasonic offer warranties that guarantee a certain level of output over 25 years, and some companies are beginning to offer 30-year warranties.

A typical rooftop solar system pays for itself in 7-10 years, leaving solar owners with 15-18 years of free electricity production while the panels are still under warranty. 

And remember, solar panels don’t disappear when they reach the end of their warranty, their production capacity just slowly degrades over time.

Given solar technology is advancing by leaps and bounds, it wouldn’t be surprising to see warranties continue to increase.

The Federal Solar Tax Credit is 30% until 2032

With the Inflation Reduction Act of 2022 passed into law, the solar tax credit is now at 30% from 2022-2032.

For many homeowners looking to get the biggest bang for their buck, this may be the most compelling reason to go solar in 2023. The Federal Solar Tax Credit, or the Investment Tax Credit, is the single largest incentive for going solar.

While many state and local governments offer their own incentives, the Federal Solar Tax Credit is eligible for any homeowner who owns their system and has income tax liability.

The tax incentive currently allows owners to claim 30% of their gross solar system cost until 2032. You can learn more about how to claim the federal solar tax credit here.

Solar Increases Your Home Value

There is a whole slew of data showing that solar home improvements truly offer bang for their buck.

According to Zillow, homes with solar panels sell for 4.1% more than homes without. That’s an additional $18,052 on the national median home sales price of $440,300 in the second quarter of 2022.

Zillow also found that energy-efficient features are important to 80% of homebuyers.

And Zillow’s not the only organization reporting the benefits of solar on home value.

A 2015 study by the  Department of Energy’s Lawrence Berkeley Laboratory and Sandia National Laboratories found Californian home buyers will pay up to $4 per watt of installed PV, while homebuyers across the country will pay around $3 per watt. This comes out to about an additional $15,000 for a home’s solar system.

Related reading: 5 Advantages of Solar Energy

Cons of Going Solar in 2024

Net Metering Rollbacks

Under Net Energy Metering (NEM), utilities credit solar module owners for excess generation that is distributed back to the grid. While many utilities still rely on NEM, some have begun rolling it back for a variety of reasons, including market maturation and the cost of utility’s bore under the system.

Notable examples include:

• California’s NEM 3.0 Solar Billing policy
• New York’s ongoing transition to VDER
• Arizona’s Net Billing battle
• North Carolina reducing net metering compensation

It’s worth noting that, in general, solar incentives (especially net metering) are not going to improve over time. So, it’s worth jumping on the incentives that are available now!

Related reading: What Are the Negatives of Solar Panels?

Solar scams

Solar scams have long plagued the industry, harming both consumers and reputable solar companies.

But that is no reason to throw the baby out with the bathwater. Going solar through a vetted and reputable installer is a means to clean, cheap electricity for millions of American homeowners.

Batteries Are Still Expensive

Batteries are not required for solar systems, but they can help maximize a system’s value. Homeowners can rely on stored solar generation at peak grid times, thereby avoiding higher utility electricity costs. While battery costs continue to decrease, however, the overall cost is still considerable.

Homeowners looking to go solar in 2023 can take advantage of the Residential Clean Energy Credit, which allows applies to battery storage up larger than 3 kWh. This credit is currently at 30% until 2032 thanks to the Inflation Reduction Act.

High Upfront Cost

Even with loca and federal incentives, going solar still has a relatively high upfront cost for homeowners paying cash.

Thankfully, there are zero-down solar loan options that spread the cost out over time and provide savings on day one.

In general, solar should be thought of as a secure, long-term investment. Not only will it immediately reduce electricity costs, but it also shields homeowners from future utility rate hikes.

Solar Panels Don’t Move With You

Unfortunately, solar panels won’t pack up and move with you. They’re a long-term investment, so if you’re planning on moving in the near future it may not make financial sense to purchase a system now.

As mentioned, solar panels do help homes sell more quickly and for more money. Even if you move, you’ll likely recoup the cost of your solar system — and perhaps even come out ahead — through the added value to your home.

Related: Is It Worth Going Solar in Your Golden Years? A Retired NASA Scientist Weighs In

The Pros and Cons of Solar in 2024

The pros and cons of solar energy are constantly changing as the industry evolves. In 2024, the key things to watch for are:

• Falling residential solar prices and financing costs
• Streamlined permitting timelines and lower costs
• Rising utility rates
• Declining solar incentive (especially net metering)

Connect with an Energy Advisor to discuss the pros and cons of going solar in your area.