With sunny skies and numerous solar installers, using solar panels in Fort Lauderdale is a great idea. It’s even home to Advanced Green Technologies, the largest solar installer in the state (though SolarCity will take over this title as they begin in operations there).
If you’re a homeowner in the Fort Lauderdale area, there are a handful of financial incentives –-including the 30% federal tax credit and net metering -- that make going solar a great decision. While Fort Lauderdale homeowners won't save as much money as those in solar-friendly states like California or Oregon (where homeowners can enjoy upfront rebates from their utilities and electricity rates are high), you can still save of dollars by installing Fort Lauderdale solar panels!
For a broader state overview, see our Florida Solar page.
* Note that these are estimated values for informational purposes only, and do not take into account the full complexity of all financial projections. They also only apply to cash purchases, which means your numbers will be different if you lease your system or pay for it with a loan (factoring in interest). Also note that we are not financial advisors, so this information should not be construed as financial advice.
Going solar in Fort Lauderdale can allow homeowners to save nearly $18,000 over the life of the solar installation. The state of Florida in recent years has adopted many policies to encourage growth in the solar industry and ensure homeowners can install solar easily and quickly. However the lack of financial incentives such as upfront rebates - as well as moderately priced electricity - hinders solar growth in the sunshine state.
For an average-sized installation of 5 kilowatts (about 20 panels), homeowners who purchase a solar installation in the Fort Lauderdale area can expect to save around $17,844 over the 25 year expected life of the installation. These savings are calculated by comparing the cost of going solar to the cost of continuing to purchase electricity from the utility over the next 25 years.
Homeowners who finance through loans realize a lower return on investment. With a 5% interest loan, you can save around $10,815 over 25 years. Significantly less than cash purchase, but almost $11,000 is nothing to scoff at! Savings from loans can vary dramatically though due to many factors including the interest rate, size of your installation, financial incentives, and utility rates.
So no matter what financing you choose, rest assured you’ll be saving thousands of dollars over the next 25 years!
As we saw above, purchasing your solar installation outright provides a faster financial payback than financing your installation with a loan.
The process for purchasing a solar installation is fairly simple and similar to any other home improvement project. You pay the installer the full cost of the installation upfront, which for many is not an easy task, as solar installations are quite expensive. As the solar owner of the installation, you are eligible to receive all financial incentives including net metering credits and the tax incentives, which seriously decreases your total investment.
You are also responsible for monitoring and maintaining operation of your installation. This isn’t too much to worry about, as manufacturers provide long-term warranties for both inverters and solar panels If a piece of equipment does malfunction, it will likely still be covered under the product warranty.
You’ll save less with loans than with a cash purchase, but they provide one clear advantage over cash purchases. With loans, homeowners do not need to provide the huge initial capital to pay for the solar installation in its entirety. Homeowners simply work with a bank, credit union, or dedicated solar loan provider who pays for the installation up front and the homeowner pays back with interest in small monthly increments.
The financial savings you’ll see with a solar loan depends on the interest rate, loan term, and any applicable fees. For our savings calculations in the section above, we assumed a 5 percent interest rate over a 12 year loan term. A lower interest rate will provide even more long term savings and a higher interest rate will lead to much lower savings.
With this in mind, if you are looking to finance your solar installation with a loan be sure to talk with several loan companies to ensure you receive the best possible arrangement. Solar installers often have a preferred lender that can provide competitive interest rates, so be sure to ask potential installers what financing is available through them.
Through PACE financing, local governments foot the bill for homeowners to install solar and other renewable and efficiency measures. Homeowners then repay the debt through an assessment on their annual property tax bill. PACE financing typically guarantees low-interest rates and longer loan terms, allowing homeowners to enjoy smaller payments each month.
One major difference between PACE financing and loans is that, unlike loans, PACE financing is connected to the property, not the homeowner. This allows you to easily move to a new location without worrying about transferring a solar loan to the new owner or paying off the loan in full before selling the home.
The city of Fort Lauderdale is currently working with two organizations to offer PACE financing:
PACE financing is a great option for homeowners lack the cash for a full upfront purchase and are contemplating moving in the next 5 to 15 years.
More: Solar Loans
Over the last 10 years, the state of Florida has enacted several policies to make going solar an easy and profitable experience.
Many pro-solar states have adopted what’s known as renewable portfolio standards, which basically mandate that a certain percentage of all electricity used in the state must come from renewable sources. Colorado, New Jersey, and California, for example, have all adopted renewable portfolio standards – typically requiring that 10 to 30 percent of all electricity come from renewable energy by 2020 or 2030. These mandates push the electricity industry to adopt and encourage growth in the renewables industry, something utilities would otherwise likely avoid.
Unfortunately, Florida has yet to adopt any state-wide renewable portfolio standards- a huge gap in their otherwise solid solar policy portfolio. However, Fort Lauderdale has stepped up to the plate themselves and set fairly high efficiency and renewable standards (PDF download) themselves for their city!
By 2020, they plan to reduce energy use by 20 percent as well as source 20 percent of their electricity from renewable sources by the same year. The city is focusing on both government and community buildings. As of publication of the above report, the city was still assessing how to implement these goals.
Electricity prices affect you financial savings going solar: the higher electricity prices are, the more money you can save going solar. In most of life, low electricity prices are a good thing, but with solar higher utility prices equals higher savings!
The average utility rate in Florida hovers around $0.1130 per kWh. Compared to the national average of $0.1275 per kWh, Florida sees fairly low rates; cheaper than Alabama’s electricity ($0.1229) though higher than Georgia ($0.1093). Don’t worry too much though. While you won’t save as much as homeowners in New York ($0.1775 per kWh!) or California ($0.1797 per kWh), going solar in Fort Lauderdale is still quite profitable!
The state of Florida requires investor-owned utilities like FPL and Duke-Progress to offer residential customers net metering credits for any excess electricity their solar installation produces and which goes into the electricity grid to be used elsewhere. Utilities credit customer accounts for the full retail cost of the excess electricity. So, for example, if your electricity rate is $0.11 per kilowatt-hour and your solar installation produces an extra 50 kilowatt-hours in a month, you will receive credit for $5.50 the following month.
If you have any credits left over at the end of the year, the utility will pay you for that excess electricity at avoided cost, which is the amount they would pay for the same amount of electricity (usually around $0.02 to $0.03 per kilowatt-hour).
More: Net Metering
The state of Florida recently passed regulations to make the process of connecting solar installations to the utility grid faster and easier for homeowners and businesses. The law set standards for the interconnection process based on the size of the solar installation:
The state of Florida guarantees homeowners the right to go solar – Homeowners Associations (HOAs) or any other similar organizations can’t bar solar in their neighborhoods. Associations can request solar panels be installed on the back side of the house where they are hidden from street view, but only if placing the panels there doesn’t affect electricity production. If you’re worried about your cantankerous HOA, you can move forward knowing you have the right to go solar!
There are currently no rebates available for Fort Lauderdale area solar. In the past however, the City of Fort Lauderdale has offered rebates to residents installing solar panels, so it’s worth reaching out for up to date information on what incentives or services they offer.
While rebates are sparse for Fort Lauderdale homeowners, there are many tax incentives that make going solar a bit more lucrative.
The 30% federal tax credit is available to homeowners across the country who install solar through a cash purchase or loan (the owner of the installation is eligible for the incentive). The credit originally phased out in 2016, but was extended until 2019, when it drops to 26% until 2021, and 22% until 2022, when it is completely phased out.
The federal tax credit is a fantastic deal – install solar panels and the federal government will allow you a dollar-for-dollar credit worth 30% of the total installation cost. Simply claim the credit the next time you file your taxes. One sweet deal!
More: Solar Federal Tax Credit
When you install solar panels, you are also eligible for the state-wide property tax exclusion, which allows homeowners in Florida to pay property taxes on the value of their property without accounting for the solar installation. So, for example, if you installed a $12,000 solar installation on your $120,000 home, you’d continue to pay property taxes for $120,000 – not $132,000!
Fort Lauderdale homeowners can take advantage of the state-wide solar tax exemption for all solar equipment installed on their home. With a sales tax rate of 6%, this exemption can save homeowners around $400 for an average-sized solar installation!
A 2015 study by the Lawrence Berkeley National Lab found that solar installations in Florida increase a home’s value between $2.30/watt and $3.11/watt (p.15 of the report). Researchers only looked at homeowner-owned installations (so no leases, PPAs, or loans) and found similar increases among both new and existing construction. So for an average-sized 5.6 kilowatt installation, home value can increase at least $13,000 for Florida solar!
Going solar in Fort Lauderdale is a great way to save money while contributing to a healthier environment. To see the most financial savings possible – especially if you decide to finance your installation through a loan – be sure to discuss with several different installers what options are available, equipment and warranties, and savings estimates. And after the installation is complete, don’t forget to apply for those tax incentives!
Is financing becoming easier with the rapidly growing solar industry? Yes definitely, but there are a couple of things you should consider before signing a deal and our Solar Financing Comparison gives you a great overview.
Solar panels are cheaper than ever before. Between emerging technologies and tax credits galore, you can put solar panels on the roof of your home for far less than what it used to cost even a decade ago.