Rooftop solar: How homeowners should do the math on the climate change investment
Solar panels create electricity on the roof of a house in Rockport, Massachusetts, U.S., June 6, 2022. Picture taken with a drone.
Brian Snyder | Reuters
When Josh Hurwitz decided to put solar power on his Connecticut house, he had three big reasons: To cut his carbon footprint, to eventually store electricity in a solar-powered battery in case of blackouts, and – crucially – to save money.
Now he’s on track to pay for his system in six years, then save tens of thousands of dollars in the 15 years after that, while giving himself a hedge against utility-rate inflation. It’s working so well, he’s preparing to add a Tesla-made battery to let him store the power he makes. Central to the deal: Tax credits and other benefits from both the state of Connecticut and from Washington, D.C., he says.
“You have to make the money work,” Hurwitz said. “You can have the best of intentions, but if the numbers don’t work it doesn’t make sense to do it.”
Hurwitz’s experience points up one benefit of the Inflation Reduction Act that passed in August: Its extension and expansion of tax credits to promote the spread of home-based solar power systems. Adoption is expected to grow 26 percent faster because of the law, which extends tax credits that had been set to expire by 2024 through 2035, says a report by Wood Mackenzie and the Solar Energy Industry Association.
Those credits will cover 30 percent of the cost of the system – and, for the first time, there’s a 30 percent credit for batteries that can store newly-produced power for use when it’s needed.
“The main thing the law does is give the industry, and consumers, assurance that the tax credits will be there today, tomorrow and for the next 10 years,” said Warren Leon, executive director of the Clean Energy States Alliance, a bipartisan coalition of state government energy agencies. “Rooftop solar is still expensive enough to require some subsidies.”
California’s solar energy net metering decision
Certainty has been the thing that’s hard to come by in solar, where frequent policy changes make the market a “solar coaster,” as one industry executive put it. Just as the expanded federal tax credits were taking effect, California on Dec. 15 slashed another big incentive allowing homeowners to sell excess solar energy generated by their systems back to the grid at attractive rates, scrambling the math anew in the largest U.S. state and its biggest solar-power market — though the changes do not take effect until next April.
Put the state and federal changes together, and Wood Mackenzie thinks the California solar market will actually shrink sharply in 2024, down by as much as 39%. Before the Inflation Reduction Act incentives were factored in, the consulting firm forecast a 50% drop with the California policy shift. Residential solar is coming off a historic quarter, with 1.57 GW installed, a 43% increase year over year, and California a little over one-third of the total, according to Wood Mackenzie.
For potential switchers, tax credits can quickly recover part of the up-front cost of going green. Hurwitz took the federal tax credit for his system when he installed it in 2020, and is preparing to add a battery now that it, too, comes with tax credits. Some contractors offer deals where they absorb the upfront cost – and claim the credit – in exchange for agreements to lease back the system.
Combined with savings on power homeowners don’t buy from utilities, the tax credits can make rooftop solar systems pay for themselves within as little as five years – and save $25,000 or more, after recovering the initial investment, within two decades.
“Will this growth have legs? Absolutely,” said Veronica Zhang, portfolio manager of the Van Eck Environmental Sustainability Fund, a green fund not exclusively focused on solar. “With utility rates going up, it’s a good time to move if you were thinking about it in the first place.”
How to calculate installation costs and benefits
Here is how the numbers work.
Nationally, the cost for solar in 2022 ranges from $16,870 to $23,170, after the tax credit, for a 10-kilowatt system, the size for which quotes are sought most often on EnergySage, a Boston-based quote-comparison site for solar panels and batteries. Most households can use a system of six or seven kilowatts, EnergySage spokesman Nick Liberati said. A 10-12 kilowatt battery costs about $13,000 more, he added.
There’s a significant variation in those numbers by region, and by the size and other factors specific to the house, EnergySage CEO Vikram Aggarwal said. In New Jersey, for example, a 7-kilowatt system costs on average $20,510 before the credit and $15,177 after it. In Houston, it’s about $1,000 less. In Chicago, that system is close to $2,000 more than in New Jersey. A more robust 10-kilowatt system costs more than $31,000 before the credit around Chicago, but $26,500 in Tampa, Fla. All of these average prices are as quoted by EnergySage.
The effectiveness of the system may also vary because of things specific to the house, including the placement of trees on or near the property, as we found out when we asked EnergySage’s online bid-solicitation system to look at specific homes.
The bids for one suburban Chicago house ranged as low as $19,096 after the federal credit and as high as $30,676.
Offsetting those costs are electricity savings and state tax breaks that recover the cost of the system in as little as 4.5 years, according to the bids. Contractors claimed that power savings and state incentives could save as much as another $27,625 over 20 years, on top of the capital cost.
Alternatively, consumers can finance the system but still own it themselves – we were quoted interest rates of 2.99 to 8.99 percent. That eliminates consumers’ up-front cost, but cuts into the savings as some of the avoided utility costs go to pay off interest, Aggarwal said.
The key to maximizing savings is to know the specific regulations in your state – and get help understanding often-complex contracts, said Hurwitz, who is a physician.
Energy storage and excess power
Some states have more generous subsidies than others, and more pro-consumer rules mandating that utilities pay higher prices for excess power that home solar systems create during peak production hours, or even extract from homeowners’ batteries.
California had among the most generous rules of all until this week. But state utility regulators agreed to let utilities pay much less for excess power they are required to buy, after power companies argued that the rates were too high, and raised power prices for other customers.
Wood Mackenzie said the details of California’s decision made it look less onerous than the firm had expected. EnergySage says the payback period for California systems without a battery will be 10 years instead of six after the new rules take effect in April. Savings in the years afterward will be about 60 percent less, the company estimates. Systems with a battery, which pay for themselves after 10 years, will be little affected because their owners keep most of their excess power instead of selling it to the utility, according to EnergySage.
“The new [California rules] certainly elongate current payback periods for solar and solar-plus-storage, but not by as much as the previous proposal,” Wood Mackenzie said in the Dec. 16 report. “By 2024, the real impacts of the IRA will begin to come to fruition.”
The more expensive power is from a local utility, the more sense home solar will make. And some contractors will back claims about power savings with agreements to pay part of your utility bill if the systems don’t produce as much energy as promised.
“You have to do your homework before you sign,” Hurwitz said. “But energy costs always go up. That’s another hidden incentive.”
Environment
EcoFlow members can save up to 65% on power stations while supporting disaster relief during the 2025 Member’s Festival
Portable power station specialist EcoFlow is kicking off its third annual Member’s Festival this month and is offering a unique new rewards program to those who become EcoFlow members. The 2025 EcoFlow Member’s Festival will offer savings of up to 65% for its participating customers, and a portion of those funds will be allocated toward rescue power solutions for communities around the globe through the company’s “Power for All” fund.
EcoFlow remains one of the industry leaders in portable power solutions and continues to trek forward in its vision to power a new tech-driven, eco-conscious future. Per its website:
Our mission from day one is to provide smart and eco-friendly energy solutions for individuals, families, and society at large. We are, were, and will continue to be a reliable and trusted energy companion for users around the world.
To achieve such goals, EcoFlow has continued to expand its portfolio of sustainable energy solutions to its community members, including portable power stations, solar generators, and mountable solar panels. While EcoFlow is doing plenty to support its growing customer base, it has expanded its reach by giving back to disaster-affected communities by helping bolster global disaster response efforts the best way it knows how– with portable power solutions.
EcoFlow and its members look to provide “Power for All”
Since 2023, EcoFlow has collaborated with organizations worldwide as part of its “Power for All” mission. This initiative aims to ensure access to reliable and timely power to disaster-affected communities across the globe, including rescue agencies, affected hospitals, and shelters, to support rescue and recovery efforts.
This fund most recently provided aid for communities affected by the recent Los Angeles wildfires, assistance to the Special Forces Charitable Trust (SFCT) in North Carolina following severe hurricanes, and support for non-profits engaged in hurricane preparedness in Florida and the Gulf Coast. Per Jodi Burns, CEO of the Special Forces Charitable Trust:
In the wake of devastating storms in Western North Carolina, reliable power was a critical need for the families we serve. Thanks to EcoFlow’s generous donation of generators, we were able to provide immediate relief, ensuring these families and their communities had access to power when they needed it most. We are so impressed with EcoFlow’s commitment to disaster response through their ‘Power for All’ program. It has made a tangible impact, and we are deeply grateful for their support and partnership in helping these families recover and rebuild.
In 2024, the US experienced 27 weather and climate events, each causing losses exceeding $1 billion, marking the second-highest annual total on record, according to National Centers for Environmental Information. The increasing frequency and severity of natural disasters underscore the critical need for reliable and timely power solutions during emergencies, much like EcoFlow and its members are helping provide through the “Power For All” initiative.
To support new and existing EcoFlow members, the company is celebrating its third annual Member’s Festival throughout April to offer a do-not-miss discount on its products and donate a portion of all sales to the “Power for All” fund to provide rescue power to those in need in the future. Learn how it all works below.
Save big and give back during the 2025 Member’s Festival
As of April 1st, you can now sign up to become an EcoFlow member to participate in the company’s exclusive 2025 Member Festival.
As a member, you can earn “EcoFlow Power Points” by completing tasks like registration, referrals, and product purchases and tracking your individual efforts toward disaster preparedness and recovery.
Beginning April 4, EcoFlow members will also be able to take advantage of exclusive discounts of up to 65% off select portable power stations, including the DELTA Pro Ultra, DELTA Pro 3, DELTA 2 Max, DELTA 3 Plus, RIVER 3 Plus, and more. However, these sale prices only last through April 25, so you’ll want to move quickly!
Click here to learn more about EcoFlow’s “Power for All” campaign. To register for EcoFlow’s 2025 Member Festival in the US, visit the EcoFlow website. To register as a member in Canada, visit here.
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Tesla is losing another top talent: its long-time head of software, David Lau, has reportedly told co-workers that he is exiting the automaker.
Tesla changed how the entire auto industry looks at software.
Before Tesla, it was an afterthought; user interfaces were rudimentary, and you had to go to a dealership to get a software update on your systems.
When Tesla launched the Model S in 2012, it all changed. Your car would get better through software updates like your phone, the large center display was responsive with a UI that actually made sense and was closer to an iPad experience than a car.
Tesla also integrated its software into its retail experience, service, and manufacturing.
David Lau deserves a lot of the credit for that.
He joined Tesla in 2012 as a senior manager of firmware engineering and quickly rose through the ranks. By 2014, he was promoted to director of firmware engineering and system integration, and in 2017, he became Vice President of software.
Lau listed the responsibilities of his team on his LinkedIn:
- Vehicle Software:
- Firmware for the powertrain, traction/stability control, HV electronics, battery management, and body control systems
- UI software and underlying Embedded Linux platforms
- Navigation and routing
- iOS and Android Mobile apps
- Distributed Systems:
- Server-side software and infrastructure that provides telemetry, diagnostics, over-the-air updates, and configuration/lifecycle management
- Data engineering and analytics platforms that power technical and business insights for an increasingly diverse set of customers across the company
- Diagnostic tools and fleet management, Manufacturing and Automation:
- Automation controls (PLC, robot)
- Server-side manufacturing execution systems that power all of Tesla’s production operations
- Product Security and Red Team for software, services, and systems across Tesla
Bloomberg reported today that Lau told his team he is leaving Tesla. The report didn’t include reasons for his stepping down.
Electrek’s Take
Twelve years at any company is a great run. At Tesla, it’s heroic. Congrats, David, on a great run. You undoubtedly had a significant impact on Tesla and software advancements in the broader auto industry.
He is another significant loss for Tesla, which has been losing a lot of top talent following a big wave of layoffs around this time last year.
I wonder who will take over. Michael Rizkalla, senior director of software engineering and vehicle firmware, is one of the most senior software engineers after Lau. He has been at Tesla for 7 years, and Tesla likes to promote within rather than hire outsiders.
There are also a lot of senior software execs working on AI at Tesla. Musk has been favoring them lately and he could fold Lau’s responsibilities under them.
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Kia’s electric SUVs are taking over. The EV3 is the best-selling retail EV in the UK this year, giving Kia its strongest sales start since it arrived 34 years ago. And it’s not just in the UK. Kia just had its best first quarter globally since it started selling cars in 1962.
Kia EV3 is the best-selling EV in the UK through March
In March, Kia sold a record nearly 20,000 vehicles in the UK, making it the fourth best-selling brand. It was also the second top-seller of electrified vehicles (EVs, PHEVs, and HEVs), accounting for over 55% of sales.
The EV3 remained the best-selling retail EV in the UK last month. Including the EV6, three-row EV9, and Niro EV, electric vehicles represented 21% of Kia’s UK sales in March.
Kia said the EV3 “started with a bang” in January, darting out as the UK’s most popular EV in retail sales. Through March, Kia’s electric SUV has held on to the crown. With the EV3 rolling out, Kia sold over 7,000 electric cars through March, nearly 50% more than in Q1 2024.
The EV3 was the best-selling retail EV in the UK in the first quarter and the fourth best-selling EV overall, including commercial vehicles.
Starting at £33,005 ($42,500), Kia said it’s the “brand’s most affordable EV yet.” It’s available with two battery packs, 58.3 kWh or 81.48 kWh, good for 430 km (270 miles) and 599 km (375 miles) of WLTP range, respectively.
With new EVs on the way, this could be just the start. Kia is launching several new EVs in the UK this year, including the EV4 sedan (and hatchback) and EV5 SUV. It also confirmed that the first PV5 electric vans will be delivered to customers by the end of the year.
Electrek’s Take
Globally, Kia sold a record 772,351 vehicles in the first quarter, its best since it started selling cars in 1962. With the new EV4, the brand’s first electric sedan and hatchback, launching this year, Kia looks to build on its momentum in 2025.
Kia has also made it very clear that it wants to be a global leader in the electric van market with its new Platform Beyond Vehicle (PBV) business, starting with the PV5 later this year.
Earlier today, we learned Kia’s midsize electric SUV, the EV5, is the fourth best-selling EV in Australia through March, outselling every BYD vehicle (at least for now). The EV5 is rolling out to new markets this year, including Canada, the UK, South Korea, and Mexico. However, it will not arrive in the US.
For those in the US, there are still a few Kia EVs to look forward to. Kia is launching the EV4 globally, including in the US, later this year. Although no date has been set, Kia confirmed the EV3 is also coming. It’s expected to arrive in mid-2026.
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