Francisco CastroJune 5, 20193660
Recently, WPVI-TV Chanel 6 in Philadelphia detailed the sales tactics for residential solar panels that can lead people to trouble down the line.
Specifically, the case dealt with 82-year-old Elaine Connor, who signed a 25-year Power Purchase Agreement (PPA) with a solar company that included an energy rate increase of 2.9% every year, and then died one month after the panels were activated.
When the woman’s daughter sold the house after her passing, she had to pay the solar company $28,000 to end the agreement.
“There were no buyers out who were willing to take the contract on,” the woman said.
Selling a house with a PPA is no easy task. While you can transfer the contract to the new owner, many balk at the idea of such a long contract that they didn’t agreed to initially.
Also, according to the woman’s daughter, her mother never truly understood everything having to do with the PPA.
Cases like this exemplify what can happen if you don’t read a contract completely. And also the dangers for older folks wanting to go solar.
Which raises the question, is solar power right for grandma?
First, installing solar panels on your home offers a number of advantages: lower electric bills, a return on investment of between 6-8 years, a long, virtually, maintenance fee lifespan of a home solar energy system and an array that will continue to provide you with energy for over two decades.
People 55 years and older make up 28% of the U.S. population. And nearly 80% of them own their own homes. They are also living longer than ever before and 87% of them want to remain in their own homes as they grow older.
Solar panels can help in this regard. The savings you get from your solar array will mean more financial independence, which is one of the factors that often lead older folks to leave their homes.
A properly-sized domestic solar power system will match their home energy needs almost completely, since these folk tend to use less power than younger households. In fact, the solar panels will generate excess energy they can send to the electric grid in exchange for the power they will need at night, when the photovoltaic (PV) modules aren’t creating electricity.
To find the appropriate size of solar array for your home, simply access the Hahasmart price checker. Provide your address and monthly electric costs and you will get an estimated price of the panels and inverter - the most expensive parts of a solar energy system. They’ll also provide you with an estimate for the cost of installation based on thousands of completed solar projects in your area. All you have to do is provide your address and your average monthly utility bill.
They’ll even provide you with an estimated buyback period, the point where the electricity savings cover the purchase of your residential solar panels and your system becomes free.
In addition, they’ll connect you with their installer network to get your residence equipped with solar power as possible.
Those who purchase a home solar energy system this year can still take advantage of a 30% tax credit for the cost of their solar installation and equipment. However, this doesn’t always apply to older Americans, because retirees usually live on fixed incomes without a lot of taxes taken out.
One way to make sure you can take the federal solar tax credit is to pay for solar by taking an additional disbursement from your 401(k) or IRA. You’ll be taxed extra for the year, but the extra amount you withdraw would increase your tax burden enough that you’d be eligible for the full credit.
Most experts don’t recommend solar leases or - as in the case above - PPAs. If you’re of a certain age, this could be a burden as well. But if you’re healthy and ready to live another couple of decades in your home, a solar lease or PPA could be a viable option. Under either of these agreements, you won’t have to pay any upfront costs for your domestic solar power system and you won’t have to worry for its maintenance either. And you’ll be saving money on your electric bill while paying a monthly fee or energy credit.
If you lease the panels, you simply make a monthly payment for “renting” them while the contract is active.
Under a PPA, the solar installer owns the panels and charge you for the electricity they produce. A PPA can still offset your entire electric bill, but it’s only really worth it if the electricity you’re getting from the solar panels is cheaper than what you would’ve been paying to the utility company.
One thing to know about solar PPAs is the price of electricity doesn’t stay the same over time. Instead, it’s subject to what’s called an “escalator,” which raises it by a set amount every 12 months. In some cases, that rate hike could outpace the actual cost of electricity from a utility, so it could pose a problem down the line.
If you opt for this option, just make sure to read the contract carefully and ask as many questions as possible so you can understand what’s involved.
Something else you must take into consideration with solar leases and PPAs is that - as exemplified above - selling your house, by you or your children, could be a problem. Most new buyers probably won’t be willing to take on a long contract they didn’t sign up initially.
And termination clauses for such agreements are often very expensive.
Programs for low-income seniors
If you live in California, you can take advantage of its Single-Family Affordable Solar Homes (SASH) and Low -Income Weatherization (LIWP) programs, which allow you to get free solar panels installed through either program; LIWP also offers energy efficiency home improvements.
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