How To Lower Your Electric Bill With Solar Panels

Jun 17, 2024 | Solar Energy

With rising electricity costs affecting households worldwide, homeowners in Long Beach California and the surrounding areas face tough choices. Increasing costs are putting a strain on family budgets, making it harder for families to allocate money for other essential needs such as education, healthcare, and recreational activities. Luckily, Mario Castillo Electric's solar services offer a solution, helping to lower monthly bills and support environmental sustainability.

    By harnessing the power of the sun, solar energy systems can provide a reliable and cost-effective alternative to traditional electricity sources. Mario Castillo Electric is helping residents in Long Beach and surrounding areas of Cerritos, Carson and Torrance California benefit by switching to solar energy.  With Mario Castillo Electric as your partner, we can help you identify how energy systems can reduce your electric bill while helping identify potential tax incentives and rebates available to those who make the transition.

    Understanding TOU Rates and Your Electric Bill

    To better appreciate the financial relief solar panels can provide, it's essential to dissect a typical electricity bill. These bills consist of various charges, including base rates, usage tiers, and sometimes, Time-of-Use (TOU) rates, which can be perplexing. 

    TOU rates, prevalent in California, adjust pricing based on the time of day, with electricity often costing more during peak demand. However, this is precisely where solar panels excel—by generating electricity during daylight peak price hours, the panels can significantly counterbalance TOU rate impacts.

    The Role of Solar Panels

    Solar panels absorb sunlight and convert it into usable electric power, offering a direct avenue for Long Beach and the surrounding areas’ homeowners the ability to generate their energy and slash their reliance on utility providers. This not only helps in reducing electricity bills but also contributes to environmental sustainability by lowering carbon footprints. The selection of solar technology has never been better, with advancements making it more accessible and efficient.

    Types of Solar Panels

    From monocrystalline to polycrystalline and even thin-film, each type caters to different requirements and budgets. Monocrystalline panels are known for their high efficiency and sleek design, making them ideal for smaller roofs. Polycrystalline panels, while slightly less efficient, are more cost-effective and have a simpler manufacturing process. Thin-film panels are flexible and lightweight, suitable for unconventional installations but generally less efficient compared to crystalline panels.

    Choosing the Right Solar Panels

    Selecting the right solar panels depends on various factors, including your energy needs, roof space, and budget. Mario Castillo Electric can assist with evaluating your solar energy needs and helping determine what solar panels are right for your situation.

    It is crucial to assess the efficiency ratings, warranty periods, and overall durability of the panels and your energy needs. For homeowners in Long Beach and the surrounding areas, it's essential to consider local weather conditions and the amount of sunlight your home receives throughout the year.

    Lowering Your Electricity Rate with Solar Panels

    Home solar panels provide a unique opportunity to buy electricity in bulk, offering significant cost savings on your electric bills over time. Essentially, by investing in solar, you can reduce your Levelized Cost of Electricity (LCOE), which is the price you pay per kilowatt-hour (kWh) of electricity used.

    Do Solar Panels Lower Your Electric Bill?

    Solar panels can not only lower your electric bill but can even replace it entirely. There are two primary ways home solar reduces your monthly electric bill:

    1. Offsetting your grid consumption with net metering credits.
    2. Reducing your grid consumption altogether, also known as "behind the meter" savings.

    With a properly sized solar system that generates 100% or more of your electricity usage, your electricity costs shift from variable grid rates to fixed monthly payments for your solar and/or battery equipment. These payments are significantly lower than the cost of grid electricity over time.

    Think of going solar as replacing your unpredictable electricity bill with more affordable, predictable monthly payments for your solar setup. Solar energy could cost about 8 cents per kWh, significantly lower than the national average of 16.6 cents per kWh for grid energy, offering substantial savings over time.

    Understanding Your Current LCOE

    To determine your current electricity rate, divide your annual electricity cost by your annual consumption in kWh. For example, if you paid $2,350 for 9,400 kWh of electricity, your LCOE would be 25 cents per kWh:

    $2,350 / 9,400 kWh = $0.25 per kWh

    Checking your utility bill can also provide this information. As a reference, the average price of electricity in California in January 2024 was 19.9 cents per kWh according to

    Calculating the LCOE of Home Solar

    The LCOE of a solar system can vary based on the size of the system, financing methods, and available incentives. Generally, a larger system purchased with cash can produce electricity at around 6-8 cents per kWh after applying the 30% solar tax credit. Smaller systems or those financed with loans may have a higher LCOE, around 12-14 cents per kWh.

    Example Calculation

    Consider purchasing a 7 kW solar system for $28,000. After accounting for the 30% tax credit and loan interest, the net cost might be $26,000. Assuming 6 hours of sunshine per day, this system could produce 255,000 kWh over 25 years, resulting in an LCOE of 10.20 cents per kWh:

    $26,000 / 255,000 kWh = $0.1020 per kWh

    This rate is lower than the national average and offers even more substantial savings in states with higher electricity costs like those in California.

    Factors Influencing Solar Savings

    Homeowners can control their solar electricity rate by:

    • Choosing the size of their system
    • Selecting specific equipment and installers
    • Taking advantage of various incentives
    • Deciding between cash or loan financing

    Mario Castillo Electric can help you find the best price for your solar energy needs. In addition we offer financing on our projects making it easier to unlock greater savings and increase the value of your home.

    Considerations Before Going Solar

    While the promise of solar includes impressive long-term savings, there’s an upfront investment to consider. It's critical to assess not only the initial cost but also the anticipated lifespan and return on investment. Essential tips include selecting a system size that aligns with energy needs and choosing a reputable installation company that offers comprehensive services and support.

    When it comes to installation, the positioning of solar panels is crucial for maximizing efficiency. Panels should ideally be placed on a south-facing roof with minimal shade. Ensuring the roof is in good condition before installation can prevent future complications and extra costs. Mario Castillo Electric specializes in this process, which typically involves a site assessment, system design, permitting, and the actual installation, followed by a thorough inspection.

    Maintenance is another important factor to consider. While solar systems generally require minimal maintenance, periodic cleaning of the panels can help maintain optimal performance. Dust, leaves, and other debris should be cleared to ensure maximum sunlight absorption. It's also advisable to schedule regular inspections by a professional to check for any wear and tear, electrical issues, or potential upgrades that can enhance system efficiency.

    While the initial investment in solar requires careful consideration of costs and benefits, paying attention to installation and maintenance factors can significantly impact the long-term success and savings of your solar system.

    Mario Castillo Electric's Solar Panel Expertise

    Choosing an experienced solar panel installer is paramount, and Long Beach residents can rely on Mario Castillo Electric's expertise. Specializing in both electric services and solar services, Mario Castillo Electric possesses the local know-how to ensure your venture into solar is as seamless and advantageous as possible.

    Embracing Solar Energy for a Sustainable Future

    Are you ready to reduce your electric bill and contribute to a more sustainable future? 

    Transitioning to solar panels offers clear financial advantages, and with the guidance of knowledgeable professionals like those at Mario Castillo Electric, the process is straightforward.

    If you're considering harnessing the power of the sun to diminish your electric bill, reach out to Mario Castillo Electric for a personalized consultation and take the next step towards energy independence. Contact Mario Castillo Electric today and begin your seamless transition to solar energy.

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