Sunshine Inc. installs a solar system that meets 100% of their electricity needs. They’re thrilled with the initial tax savings, and they’re thrilled each month when they open up their low electricity bill. They watch from afar as their competitors’ electricity rates climb year after year, eating into their bottom line.
But then something funny starts to happen. One month, they notice their electric bill is quite a lot higher than months’ past. The weather has been nice as ever, and their solar system seems to be churning out as many kWhs as it should. So what happened?
Around the same time, Sunshine Inc. installed a new, energy-sucking machine to churn out more product. They extended their hours of operation to help meet the increase in demand, leaving their lights on hours longer than before. They increased their electricity consumption.
Sunshine Inc.’s 100% now is very different from their 100% when they installed their solar system. But they miss those tiny electric bills, and they want them back.
What can Sunshine Inc. do?
In many situations, adding onto an existing solar system is a great way to wind electricity bills back down, for businesses and homeowners alike. Nothing stays the same for long. Whether its new technology for your business that helps your team work more efficiently or you treat yourself and your family to a new hot tub, the amount of electricity we use changes.
Solar technology also changes. Over the past years, solar panels have grown more efficient, and installation costs have decreased substantially. The cost to add on to your solar system could be significantly less than the cost of your original system.
Whether increasing your solar system’s size was always your plan, or you’re looking to get back to that 100% coverage, adding on to your system could help you add on to your bank account. But how is it done, and what do you need to know before getting started?
Things to Consider When Expanding Your Solar PV System
Space and Location
One of the first things you’ll need to consider is where the additional solar panels will go. If you previously installed a roof-mounted system, there may not be an area available that’s well-exposed to the sun for more panels. If you have a ground mounted system, available space may be less of a concern, however, you’ll have to consider this when deciding how many panels you want to add. Remember - panels that face south and are free from any shade (like trees, buildings, or other obstacles) perform the best.
Desired Additional Capacity
Now that you’ve considered what kind of room you have for new solar panels, you can start thinking about how large your additional system should be. Determine your goal for the project. Do you want to cover 100% of your electricity usage, or do you want to just reduce your electricity bill? Talk to your solar installer and share your current electricity bill with them, so you can determine what the best size is to meet your specific goals.
Incentives may be different for expanding your solar system than when you installed solar for the first time. But the good news is, as long as you own your solar system (as opposed to a PPA or lease), and you have tax liability, you will be able to use the 26% Solar Investment Tax Credit from the federal government.*
If you’re a business, you’ll also be able to take advantage of MACRS accelerated depreciation, which accelerates all tax savings from depreciation to the year you install your system.
In addition to cost-saving incentives, adding a new solar system could potentially cost much less than your original system. According to a 2018 NREL study, the cost of going solar is less than half of what it was in 2010. The average residential solar system costs 63% less to install in 2018 than in 2010, and commercial systems cost 66% less.
How Will You Expand the Solar System
You have a few different options as far as how you go about increasing the amount of solar energy your property produces. The best is, of course, based on your situation and your goals. Our goal for this section is to help you identify which option is the best for you. But that’s hard to do in a blog post, so feel free to contact us for a consultation!
Install Your Additional Panels as a New System
If you’re looking into increasing your solar system’s size by more than a couple kWs, probably your best bet is to look at it as installing a new solar system with new panels and new inverters. In many ways, this could be the easiest and cheapest option.
Oftentimes, installing a new (separate) system is more straightforward and takes less time than integrating new panels with an older system. And you won’t have to worry about voiding your warranty on your original solar system, should you decide to go with a different installer.
This could give you more options for spacing as well. You’re not constrained by the location of the original system. If there is no room on your roof, maybe a ground mount or a carport would be a good solution for you.
However, depending on your local regulations and utility, you will probably have to request a permit and get approval from your electric company.
Adding Panels to the Original Installation - No New Inverter
If you have more room on your roof or directly next to your ground mount, you may be able to add panels on to the existing system with a new section of racking. But there are a few important things to keep in mind if you’re considering this route.
You need to make sure the panels are compatible. The safest and best option is to add on to your solar system with the same exact panels. If that model is no longer available, you may be able to use a different panel with similar capacity. Your solar installer should be able to let you know what is possible for your system.
You’ll also need to make sure your inverters can support the additional capacity from the added panels. Depending on the size of your inverter relative to your system, you may be able to add a few panels and connect them to the existing inverter. But if your inverter capacity is significantly less than the DC size of the new and the old system combined, you’ll need separate inverters.
Another thing to consider is the warranty on your original installation. If you were happy with the company that installed your first system, it’s a good idea to stick with them if you add more panels. If you switch installers, you’ll risk voiding the installer’s warranty on your original system, should any issues come up down the road. However, not all solar installers do add-on projects.
Adding Panels With a New Inverter
If your new panels and old panels can’t be supported by your original inverter system, you may be able to replace it with a new one. Depending on the capacity installed, you could add one new large inverter whose peak power capacity can support your system’s addition.
It may be frustrating to replace a perfectly functioning inverter with a new one, but inverters are often the most complex part of a solar system, and the part most likely to have issues. If the savings from your additional solar panels give you enough back in electricity savings, getting a brand new inverter may be the best option in the long run.
Whether adding extra panels to your solar system was always in the cards, or you’ve since ramped up your electricity usage, expanding your solar panel system could be a great way to get even more savings out of the sun.
*The advice given in this blog is general in nature. Contact your tax advisor to for more information.