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Are Solar Farms Really Profitable? The Truth About Making Money With Solar.

Solar Basics | 2 min read
Solar farm at Martin Limestone in New Holland, PA.

Buy an empty lot. Install solar panels. Produce Electricity. Make Money. Right? Unfortunately, this scenario is not possible, and this blog explains why.

Does Solar Directly Make You Money?

There is a misconception that when you install solar you are actually making money. In reality, you reduce or eliminate an expense (your electric bill), rather than produce direct income. However, if you run a business or farm, you have more money to invest in building or growing your business, which leads to more profitability. Going back to our ‘empty lot’ example, there is no electricity being used at the lot so therefore you cannot reduce an expense.

But Why Can’t the Utility Just Pay Me Money for the Electricity I Produce?

Utility net metering regulations are another reason why this scenario is not possible. In most areas, utilities will exchange kilowatt-hours (kWh) one to one when their customer produces electricity through the use of solar panels. However, utilities also have regulations on how much production can come from a solar system in comparison to how much electricity is used directly by the customer. In most cases, this production ceiling is not more than 100% of the total yearly usage for the customer. If a customer would overproduce on an annual basis, the utility may pay them only a nominal percentage of their typical cost per kWh. Again, going back to our ‘empty lot’ example, there is no usage from the empty lot, so all of the electricity that the solar system would produce could only be sold to the utility at the nominal percentage, meaning little to no income for you.

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How We Design Solar Arrays

When we design a solar system for your business, farm, or home, we design a system that will meet about 100% of your total yearly electricity usage. Some years you may use less electricity, and some years you may use more, so this percentage will possibly change from year to year. However, we try to design a system that will yield the greatest benefit to you and help you save the most amount of money because we know you have better uses for your money than electricity.

How Can Solar Save You Money?

In addition to reducing a significant expense, installing solar panels will help you pay fewer taxes. There is also an opportunity to generate some income off of solar, but it's not from overproducing. Many states have an SREC market,  which allows you to generate and sell credits for every 1,000 kWh your system produces.

If you’re curious about the impact solar energy could have on your finances, reach out to us. Our solar consultants would be happy to review your energy needs and provide a free quote to see if solar is the right investment for you.

If you're not ready for a quote, download our solar buying guide for answers to many of the questions you'll have during the process of going solar. 

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