Tiered Rates:  Often people are paying a "Tiered" rate for their electricity.  This is a higher rate (higher than the "Base" rate) for electricity charged when a home or building uses more that a "Base" amount allocated for the building. Installing a solar system will reduce your electrical demand from the utility.  This can result in a lower utility rate because you stay within the "Base" rate level. In this case, the more expensive "Tiered" rate electricity is eliminated, reducing your average electricity rate.

TOU Metering: Many utilities offer Time-of-Use (TOU) meters.  This allows the price of electricity to vary by time of day (called "Peak" or "Off-Peak" periods) and by season (usually "Winter" verses "Summer" rates).  If TOU metering is offered by your utility, a solar system may result in additional savings.  This is because peak (more expensive electricity) rates often occur during the daytime.  This is usually when a solar system is producing the most output, thus reducing your demand for peak-rate electricity from the utility.

Most utilities do charge for the purchase and installation of a time-of-use meter (normally a few hundred dollars).  We have assumed the cost for this is part of the "Estimated Installation cost" shown above.

Net-Metering: With Net-Metering, surplus electricity generated by your renewable energy system will be credited back to your utility account.  So if your solar system makes more electricity than you are using, the "meter spins backwards".  You are not actually "selling" electricity, since in most states the utility will not reimburse you for excess electricity.  But, if your utility offers "Net-Metering" you may be able to get credit for electricity provided back to the grid during peak periods.  Combined with TOU metering, Net-Metering can result in multiplied savings since your electricity account may be gaining electricity credits during the time of peak utility rates -- Think of a hot, sunny summer day ... your solar system is producing power, spinning your electric meter backwards, and supplying the grid with electricity to run other people's air conditioners -- you're "spinning back" cost at peak rates!  That's the savings power of Net-metering, combined with TOU rates.

Solar Power "Fixes" Energy Costs:  The cost of sunshine is free.  While the sun rises every morning, the cost of sunshine does not. Utility rates, on the other hand, tend to rise steadily in cost.  So, the value of your savings from a solar system are likely to increase as time goes on.  If you are on a fixed income (e.g. nearing or in retirement) this may be of particular interest to you.