Interested in renewable energy and solar power in Colorado? If you invest in a solar system for your home, you’re making a great choice. Not only can you enjoy savings on your power bill, your solar system will eventually pay for itself – and you’ll also get great tax credits, and do good for the environment. We call that a win-win!
Still deciding whether or not to purchase a solar panel system in the area? We get it. Investing in solar energy in Colorado is a big decision – so we’ve put together some useful statistics and information that can help you make the right choice!
Understanding Solar Panel Incentives In Colorado
First, let’s start with the solar panel incentives available to Colorado residents. When you purchase a solar system in Colorado, you’re eligible for some serious tax breaks – which can help defray the cost of the system.
The most obvious credit is the Federal Investment Tax Credit, also called the ITC, which you’ll qualify for, should you purchase your own solar system outright. This credit amounts to 30% of the total cost of purchasing your home solar system, after deducting any applicable state rebates.
However, after the end of 2019, this will drop to 26, and then to 22% by the end of 2020 – so for the biggest tax break, you should invest in solar energy in Colorado right away.
You can also get rebates, ranging from a few hundred to thousands of dollars, from your local utility providers. These rebates vary – so contact the utility company in your area, such as United Power, San Miguel Power, Black Hills Energy, or Xcel Energy.
In addition, because solar panels add to the value of your home, you may expect property taxes to rise accordingly. But in Colorado, you do not have to add the value of renewable energy sources – such as solar panels – to the value of your home, saving you money on your tax bill.
The Cost Of Solar Panels In Colorado
The cost of solar panels in Colorado will vary, based on the specifics about your installation, the size of your system, the company you choose, and a number of other factors.
However, the average cost per watt of a solar panel system in Colorado is $3.66 per watt for a system purchased in cash or $4.08 per watt for a system that’s financed. That means that, if you purchase a 5-kilowatt system, for example, you will pay an average of $18,300 – though this does not take tax credits and rebates into account.
Beyond simply saving through credits and incentives, the C-PACE Program from Colorado offers a unique way to finance the purchase of solar panels. The program works through a tax assessment, which allows the cost of a solar system to be spread over a 20-year period, through annual tax payments.
Understanding Current Power Prices In Colorado
One great reason to invest in solar panels in Colorado is that the price of electricity has been rising consistently since 2002, at an average rate of around 5.5% per year. Today, for example, Denver residents are paying approximately 11.05 cents per kWh. As the price of power rises, so does the value of a solar panel system – you’ll save more on energy, even if the price of power increases.
In fact, power price increases could be valuable if you install your own solar panel system. That’s because Colorado is a “net-metering” state. You will receive credits for any additional power that your home produces during the day – and these credits are used to power your home on cloudy days, or at night.
Best of all, energy companies are required to pay you back for any electricity you produce and send back to the power grid, over the course of the year. If you end up producing more power than you use, the utility company has to send you a check, based on current market rates, for the power that you provided to their power grid.
If you install an efficient system and minimize your own power usage, you may even turn a profit each year!
Expected Sunshine Hours And Efficiency Of Solar Panels In Colorado
Colorado is a great state for solar panels. The state ranks at 11th for solar power, and has an average of 250-300 days of sunshine per year, though this may vary based on where you are. In Pueblo, for example, you can expect 258 sunny days per year, while in Alamosa, you may get up to 285 days with sun per year, even during the chillier winter months.
Another way to look at sunshine hours and efficiency is to look at the total yearly sunshine percentage. In Colorado, this is about 70% – that is to say, 70% of the time that the sun is in the sky (between sunrise and sunset) it will be reaching your solar panels.
This means that your solar panels will be efficient and continue to generate power all-year-round.
Invest In Solar Energy In Colorado
If you pay around $3.50 per watt for a solar system, get rebates from local energy companies and federal tax breaks, and sell your energy back to the power grid with net metering, you will be able to get your investment back in just over 8 years and save nearly $35,000 over the lifetime of your solar system.
So don’t wait. Investing in solar power now is the best way to make use of current tax incentives – and the sooner you install a solar system, the sooner you’ll be able to start saving money on your power bill.