Posted By 
By Sia Hasan
Special to the Financial Independence Hub
One of the biggest changes to the energy industry has been the introduction of renewable energy. The idea that energy could be produced without having to burn fossil fuels was extremely foreign to the industry at its inception. Luckily, more and more consumers have made the switch to solar and other renewables to build a greener and more sustainable energy infrastructure. This gradual switch to solar has affected more than just large utilities. So, how have changes to the renewable energy sector affected the daily lives of most citizens?
- Average Energy Bills Are Falling
- The Cost Of Installing Solar Is Lower Than Ever
- More Legislative Actions Are Being Taken To Support Renewable Energy
Average energy bills falling
Homeowners who make the switch to solar will immediately see that they now have lower energy bills. This is because fewer kilowatt hours must now be pulled from the grid because many are already being supplied for free by the sun via your rooftop solar system. These lower bills mean keeping more money in your pocket to spend on other things like better food on the table or a fun weekend getaway for the family. Over the 30+ year lifetime of a solar system, the savings can be massive. Additionally, those who install a solar system usually begin to value electricity more than those who don’t. This can cause homeowners to take additional measures such as installing energy efficient appliances and undertaking LED lighting upgrades which can even further lower energy bills.
Cost of installing Solar lower than ever
Thanks to improved manufacturing processes and higher demand for home renewable energy systems, the average solar panel cost has been falling at a fairly predictable rate over the years. In fact, it is estimated that the cost of solar is falling even faster than some experts expected. So what does this mean for consumers?
Most importantly, it means that solar is becoming more and more cost competitive with more traditional ways of getting power such as just pulling it from the grid which is maintained by your local utility. The falling cost of solar means that homeowners will now have shorter payback periods for home solar systems meaning it will take far less time for the solar system to pay for itself. The main reason for this is that solar prices are falling while the cost of energy from utilities is remaining constant. So, for every kilowatt hour you self-generate, this is one fewer kilowatt hour you must pay for in your monthly electric bill. Whereas payback periods for solar systems may have been greater than 20 years just a decade ago, they may now be as low as just 8 or 9 years after fully monetizing all available tax incentives.
More legislative actions being taken to support Renewable Energy
Federal and state governments [in the U.S.] have played a very important role in expanding the use of renewable energy across the country. So how does this affect your daily lives? One of the most common ways to support renewable energy development is through the use of a Renewable Portfolio Standard (RPS). An RPS mandates that a certain percentage of all power generated within the borders of that state come from renewable energy resources. This helps citizens with regards to cleaner air, water, and a healthier environment for generations to come. Additionally, the Federal government offers an Investment Tax Credit (ITC) equal to 30% of the total installed cost of a solar system. This has even further encouraged solar development helping communities become cleaner as they rely more on distributed generation.
The energy sector is always in a constant state of flux. As more renewable energy sources come online, a new set of challenges will present themselves such as energy storage and moving away from centralized power generation. By seeking to understand how renewable energy affects our lives on an individual scale, we can be better suited to deal with change.
Sia Hasan is a tech entrepreneur by day, and a freelance writer by night. Her passion lies in business technology, efficient and sleek programming, and customer relationship management. When she doesn’t have her nose pressed against her computer screen, you can find her spending time with the loves of her life, her two dogs, Pixel and Vector.
