Connecticut, New York and Massachusetts now outrank California, Arizona and New Mexico in the amount of money each ray of sunlight can generate for homeowners, according to the Geostellar Solar Index, a new scientific and economic analysis of Americans’ savings through rooftop solar.
The new index shows the Northeast and Mid-Atlantic states offer the highest Internal Rate of Return (IRR) on residential solar energy. This economic analysis measures and compares the profitability of investments, with profits as high as 24% per year over the 25-year life of the solar array. By comparison, the S&P 500 has shown a 9.9% Compounded Annual Growth Rate over the last 50 years, 30-year U.S. Treasuries have a current yield of 3.7%, and 5-year certificates of deposit (CDs) typically return just 0.75% annually.
Tax credits and other incentives in New York and Connecticut have helped propel those states toward the top of the Geostellar Solar Index. The IRR’s are calculated using sophisticated economics, energy and environmental factors in order of profitability for residential solar installments.
“Residents of the top states in the index can see their investment would be completely paid back in four to six years, and then receive free energy worth another five times’ that amount,” said Mark Wirt, Geostellar’s senior analyst. “The wide spread between solar and conventional electricity in some markets has created broader opportunities for third-party financing and zero-money down offers, where institutions become co-investors with the homeowner, providing upfront money and participating in the yields.”
Contact Energy By Choice ~ we’ll be happy to show you the costs and long-term savings of a solar system for your home.
Excerpts of article in Solar Builder Magazine, Sept/Oct 2013