In 42 of the United States’ biggest cities, rooftop solar now provides cheaper electricity than the traditional grid.
That’s according to “Going Solar in America: Ranking Solar’s Value to Consumers in America’s Largest Cities,” a new report from the North Carolina Clean Energy Technology Center and sponsored by the U.S. Department of Energy. In the report, the authors write that a “fully-financed, typically-sized solar PV [photovoltaic] system” is not only cheaper than electricity purchased from utilities in 42 of America’s 50 biggest cities, it is also a better investment than the stock market in 46 of America’s 50 biggest cities.
To rank America’s 50 largest cities for best solar investments, the authors created a system that considers a list of factors: first-year average monthly savings; value of investing in solar relative to long-term investments in Standard and Poor’s 500 stock index; and the “levelized cost” of the system (cost as compared to the cost of energy from a customer’s local utility).
Senior Policy Analyst and report co-author Jim Kennerly explained that research from the National Renewable Energy Laboratory (NREL) showed that customers “tend to be more responsive to something that gives them greater benefits more quickly” – hence ranking solar ROI by immediate savings.
“There are many reasons people will go solar, like environmental or energy security concerns, but we chose to look at these financial things because money is the one that gets people to act,” said co-author Autumn Proudlove. “Just talking money, solar is a good option for the average person right now.”
The authors created a companion report that informs homeowners how they can take advantage of available solar in their cities.
Part of solar’s growing affordability has to do with the technology’s falling cost. According to Lawrence Berkeley National Laboratory, the 1998 median cost of residential solar was $12 per watt. In 2013, it had dropped to $4.70 per watt. EnergySage reported that average costs – without incentives – ranged between $3.70 per watt and $4.24 per watt by the third quarter of 2014.
The growing investment opportunity for solar PV homeowners has significantly contributed to the industry’s overall growth last year. A census published in early January found that the industry grew 21.8 percent in 2014 – 10 times faster than job growth for the entire U.S. economy.