What Are the Benefits of Solar Panels?

Benefits of installing solar panels

Embracing solar energy systems can unlock numerous advantages for homeowners. If you’re considering installing solar panels on your home, here are some key benefits to keep in mind.

Environmental benefits

Unlike fossil fuels, solar energy doesn’t rely on a scarce, nonrenewable commodity, so many people are drawn to solar panels as a means of protecting the planet.

» MORE: Solar energy vs. fossil fuels

Air quality improvement

Most electric companies burn fossil fuels to supply homes with energy. These fuels, made from oil and gas, produce carbon emissions and pollute the air with greenhouse gasses. These byproducts are largely responsible for climate change, heating the earth and throwing entire ecosystems out of balance.

According to the U.S. Environmental Protection Agency, electric power was the second-highest emitter of greenhouse gases in the nation in 2022, behind transportation.

Using solar energy helps protect people and the environment while mitigating the risk of extreme weather events.

When you install a solar panel system, you’re choosing a greener option. The main environmental impacts of solar panel manufacturing are relatively minor in comparison to fossil fuel generation, and the long-term benefits of solar panels outweigh the harm that comes from making them.

Water conservation

Unlike power plants that burn fossil fuels, which often rely on steam turbines to generate electricity and cool machines, solar panels don’t need water to generate electricity. With the number of droughts increasing, making a move that helps conserve the water supply is a huge environmental advantage.

Financial benefits

The cost of solar system installation can be hefty, but you should earn back what you initially paid. Your exact solar savings will depend on how much energy you consume and how much you produce, but you’ll likely see a positive impact on your bank account over time — most homeowners report saving more than $1,000 a year.

» MORE: Are solar panels worth it?

Electric bill reduction

You generally don’t have to pay for the energy your solar panels produce, which means your electricity bill should be significantly reduced, if not eliminated.

Additionally, when your solar panels are connected to the electric grid, net metering programs can provide credits for any excess energy your system sends out to the grid.

Utility companies let you spend these credits whenever you need more energy than your solar panels are providing, such as during evening hours or winter. Solar energy systems that are off-grid eliminate utility bills entirely.

» MORE: Types of solar grid systems

Solar panels are also reliable and long-lasting, with most functioning successfully for 25 years. They also require very little upkeep, so you shouldn’t have to deal with significant maintenance fees. (Even if something does break, most solar companies offer 20- to 25-year warranties.)

These factors combine to create a situation where solar panels provide incremental savings that add up to a significant return on investment.

Tax incentives and rebates

While the federal government will no longer issue a 30% tax credit for residents who install solar panels for their homes after Dec. 31, 2025, your state or territory may still have incentives related to solar power. For example, check out our article about solar incentives, tax credits and rebates in California.

Through its N.C. Clean Energy Technology Center, North Carolina State University offers an online database of renewable energy incentives. You might use this directory as a starting point to search for available rebates and tax credits in your area.

Increased property value

If you want to increase your home’s value, solar panels can help with that. According to the National Renewable Energy Laboratory (NREL), home values increase by $20 for every $1 your solar panels save you on energy bills. So, if your solar panels save you $1,000 per year, your home’s value increases by $20,000.

It’s also increasingly common for homebuyers to consider a house’s energy efficiency before they buy it, and reports show many people are willing to pay extra for solar-powered properties. This may vary by region, so be sure to research the potential increase in property value before you install if this is an important factor for you.

» MORE: Do solar panels increase home value?

Community and economic benefits

Although many people install solar panels for personal gain, it impacts more than just you and your family. In fact, you’re often doing a solid for your neighbors, too.

Support for local jobs and economy

When you invest in solar, you support everyone in the solar community, including local solar installers and companies who work hard to provide alternative and renewable energy options. By investing in solar equipment, you help fund these important jobs and ongoing research to make energy more sustainable. At the end of the day, the economic benefits of your purchase have ripple effects far beyond your property.

Grid/community energy benefits

If your solar energy system, like most, is tied to the electrical grid, you’re part of a community of people who also rely on that conventional energy source. However, people with solar panels can also send excess energy from their panels out to the grid through net metering, which credits solar panel owners for unused power generated by their solar energy system.

This process not only reduces your utility bills — it helps lower the price for everyone else. The more residences that rely on solar power in one area, the less pressure the grid has to produce enough energy for everyone.

Energy independence

Like any product, energy is susceptible to the law of supply and demand — which means the more energy people need, the higher the price jumps. If you don’t want to deal with the ups and downs of the energy market, solar panels may be a worthwhile investment.

As of publishing, energy rates across the United States remain on a steep upward trend.

People who prefer to be completely autonomous often install off-grid solar panel systems. These systems are more common in rural areas and are entirely self-sustaining. That means when sunlight isn’t available, they pull energy from a backup battery rather than taking electricity from the grid.

However, many local governments require you to connect to the electrical grid so that your excess energy benefits the communal system instead of being stored in your personal battery. While having a grid-tied solar energy system doesn’t qualify as total independence, you’re not subject to as much pricing volatility because your panels are still offsetting some of your energy needs.

Whether your property is better off with a grid-tied or off-grid system is one of several decisions you can make during the design stage of going solar.

Bottom line

Solar panels can help you save money and the environment while benefitting your community and helping you live independently. If you’re interested in going solar, check out our top picks for the best solar companies to get started.

Though outfitting your home with solar energy-producing equipment is a large undertaking, the benefits of solar power can make the process rewarding.

» MORE: Solar energy pros and cons