When Is the Best Time to Buy Solar Panels?
There’s no question that the best time to own solar panels is at the end of your utility cycle when you receive an electricity bill for zero dollars. But when is the best time to buy solar panels?
The answer to this question depends on a few things like your location, net metering policy, and local incentives. In this article, we’ll cover some of the things to think about when your deciding when to go solar.
When is the best time to buy solar panels?
For many US homeowners, fall is the best time to buy solar panels because it sets them up for an early spring installation, which has its advantages.
The process of going solar typically takes between three to five months from start to finish, so in order to have your solar system up and running by late March, you’d need to get the process going in October to December.
There are two major advantages of shopping for solar panels in the fall:
- Fall/winter is the slow season for the solar industry, which means Energy Associates and installers are able to spend more time with each customer
- By installing and activating your solar system in early spring, you can avoid overlap between your solar and utility payments
One quick note before we dive deeper into the points above: The Inflation Reduction Act set the federal solar tax credit at 30% from 2022 to 2032, whereas it was previously scheduled to step down from 26% to 22% on January 1, 2023. That means there is no longer a benefit to having your system installed before the new year.
Better customer experience
Like most industries, residential solar has its busy and slow seasons.
Summer is typically the busiest time of year. With the sun shining, air conditioners humming, and electricity bills peaking, homeowners look to solar as a way to reduce their energy costs. Fall and winter are slower for the opposite reasons – less sunlight, little to no A/C, and lower energy bills. But that’s exactly what makes it the best time to go solar.
Three reasons to start your solar project in the fall
- Greater scheduling flexibility for calls and appointments
- More face time to ask questions and address concerns
- Stronger personal connections with the people managing your solar project
With fewer customers, Energy Associates and solar installers simply have more time get to know each customer and perfect each project, which makes for a better customer experience. For a peak behind the curtain, solar.com Energy Associates field about half as many calls in the winter as they do in the summer. That means more flexibility in their call schedules and more time to answer questions about roof types, panel models, puppies — whatever is on your mind.
Projects that are started in fall/winter typically move faster, too.
Think of shopping for solar panels like going out for breakfast. If you go on Sunday morning there will be a line out the door, 10 other tables competing for your server’s attention, and the food will take longer to prepare and deliver – it’s just the nature of the beast.
But if you go out for breakfast on a Tuesday morning you’ll have an entirely different – and in many ways better – experience. The restaurant will be at most half full, the server will have time to chit-chat and customize your order, and the food will come out hot, fresh, and fast.
Now, solar panels aren’t a $13 plate of eggs benedict. They are a major investment with a substantial upfront cost and even greater return on investment. So having that extra time, care, and attention from your installer and Energy Associate is absolutely worth starting your project during the off season.
Avoid overlapping solar and utility payments
Another reason why fall is the best time to buy solar panels is can help you to avoid overlap between your utility and solar payments.
After all, replacing your utility bill with a lower solar payment is a huge reason for going solar, and it would be a shame to pay for both at once. Here’s how shopping during the offseason can help you avoid this overlap.
In general, solar systems tend to overproduce in the spring and fall and underproduce in the summer and winter.
The best months for overproduction – and best chance to build up net metering credit – are often March, April, and May as shown by the charts below for a home near Los Angeles. Note: Production and consumption will vary by location, solar production, and electricity consumption.
By shooting for a March 21 installation date, you are setting yourself up to start overproducing and earning credit right off the bat — which will minimize, if not eliminate, your utility bill.
Now, annual billing cycles vary from utility to utility. Some cycles when your system is activated, while others start in late winter or early spring, which can affect your first year’s savings.
Say your billing cycle runs from April 1 through March 31, as it does in Washington State. If you activate your system on March 21, your first net metering cycle will likely include 10 days of overproduction and you probably won’t have a balance to pay.
But if you activate your system on November 1. You’ll likely have four months of underproduction and just one month of overproduction, and you’ll end up paying for your solar system and grid electricity at the same time.
Here’s the first net metering cycle could look for the same solar system installed in fall versus spring:
|Utility billing month||System activated November 1||System activated March 21|
|Total bill for first cycle||$60 + solar costs||$0* + solar costs|
*You may or may not be compensated for having a negative balance at the end of the billing cycle. Check your local utility’s net metering policy.
It’s important to note that every home’s billing cycle, solar production, and energy consumption are different. But in order to avoid paying for both at once, the best time to activate your solar system is in early spring.
Based on the 3-5 month lead time, the best time to buy solar panels is in the fall so you are ready to activate your system and start producing in the spring.
Why it’s best to buy solar panels sooner rather than later
By shopping for solar panels in the fall you can improve your customer experience and minimize your first net metering bill. But there are a few other things to consider when choosing when to go solar.
To make sure you can use the solar tax credit
The best solar incentive available to most homeowners is the federal solar tax credit worth 30% of the installed cost of your solar project.
That means if you paid $20,000 for your solar system, you can claim a $6,000 credit on your federal tax return, effectively reducing the cost of the project to $14,000.
However, this non-refundable tax credit can only be used to reduce your tax liability – it’s not a “Thank You For Going Solar” Hallmark card with a $6,000 check inside.
Having sufficient tax liability generally isn’t an issue for homeowners that are still in the workforce, but it tends to become an issue for retirees that no longer have much taxable income.
Frankly, this can come as a frustrating surprise to retired homeowners and it’s worth keeping in mind as you plan your solar project. So if retirement is on the horizon, the best time to buy solar panels may be before you hang up your boots.
This article does not constitute tax advice. Consult a licensed tax professional with questions regarding tax liability and the federal solar tax credit.
To claim incentives and net metering policies before they change
Net metering and incentives have been monumental for increasing residential solar adoption and nurturing a growing industry. However, the cost of solar panels has decreased rapidly in the last decade and changed the landscape.
Another thing to consider is proposed changes to net metering policies. Just like solar incentives, many net metering policies were formed 10-20 years ago when solar was still an expensive, budding technology.
Now that solar is much cheaper, utilities – namely in California and New York – are proposing changes to net metering policies that would increase costs for solar owners.
So the best time to buy solar panels it before those changes happen so you can be grandfathered into a more favorable net metering policy.
The sooner you go solar, sooner you’ll save
Perhaps the best reason not to wait to go solar is because you can’t start saving until you start generating.
Like real estate and your 401k, solar is a long-term investment, often with a substantial return. But, you can’t start saving until you make the investment. And the longer you wait, the longer you’re subject to grid electricity prices (shown below), which makes yesterday the best time to buy solar panels.
Best time to buy solar panels is when you’re ready
Just like buying a house, solar is a long-term investment and there’s more to be lost than gained by trying to time the market. The best time to buy solar panels is when you are ready to make the investment in your future.
However, if you are trying to choose a time of year to start your search, fall and winter provide some unique advantages. By starting the search in the offseason, you’ll have more hands-on service from installers and Energy Associates. You’ll also set yourself up to avoid overlap between your solar and utility payments.