If your old bill was $300 a month, you’re now paying an extra $36 every 30 days – for the exact same service.
Harder still is a 25% rate hike. Your monthly bill just jumped up another $75.
But some unlucky SDG&E customers actually saw their electricity bills jump up a full 40%. To put that in perspective, they’re now paying $120 more (or $1,440 annually) for their electricity.
Why bring this up? This 12% to 40% rate increase from SDG&E has already been all over the news.
Well, we bring it up to dispel a common myth – that going solar is expensive.
It really isn’t. In fact, it’s incredibly affordable. But first a little background.
Why Solar Energy Was, Is, and Will Be a Great Investment
In a recent survey of California homeowners, respondents wildly overestimated the true cost of going solar.
In fact, 97% of those surveyed placed their estimates too high – sometimes by as much as $20,000.
But even the best cost estimates fall short – for 2 important reasons:
1. Solar panel prices keep falling. In some 5-year stretches, costs have dropped by more than 80%.
2. Solar incentives guarantee that you’ll never pay full price for your installation. This is especially true in San Diego County – one of the most active solar markets in the country.
But regardless of price, you don’t need a lot of money to receive a new solar PV installation.
1. Some San Diego homeowners use solar leases. They basically rent their installations and pay nothing upfront. These homeowners only pay for the clean electricity that the leased solar panels produce. We don’t recommend this approach (for the reasons listed here), but it’s still a popular option.
2. The better option is to use a low interest solar loan. When done correctly, the monthly electricity bill savings from your installation are larger than your monthly loan repayments. In other words, you end up paying less than you used to.
Putting the 40% Rate Increase from SDG&E in Context
Solar was affordable back in August before SDG&E raised its rates by 12% to 40%.
But now, it’s become even more affordable.
The relative cost of going solar has gone done considerably. In fact, it’s gone down nearly 40%.
Think of it this way.
- It’s August, and your electricity bill is $300
- In September, SDG&E raises its rates 40%, forcing you to pay $420
- You install enough solar capacity to reduce your bill by 33%
You’re now paying $280 a month (which is less than what you were paying before).
And those savings only go up as utility companies continue raising their electricity rates. Oil and gas become more expensive with time – but the sun remains the same price – always free.
Going solar isn’t unaffordable. Staying on the utility grid is.