What’s the average payback period for an average solar home in Iowa?
The current cost of constructing a photovoltaic solar array varies between $3-4/watt dc installed. A typical Iowa household would require an array sized about 7 kilowatts (kW) having an installed cost between $21,000-28,000. Variations based on specific site conditions should be expected but this is a good guide to plan from. The payback for the system is very dependent on: 1) The value of the energy generated and used by the homeowner (electric rates vary widely across the state depending on the utility company, location, and size of the customer); 2) The number of incentives that the homeowner can take advantage of (30% federal income tax credit, Iowa income tax credit having maximums of $1,500 for residential and $15,000 for commercial customers, Alliant Energy customer rebates, zero percent financing through the Iowa Energy Center’s Alternate Energy Revolving Loan Program, AERLP); 3) The quantity of energy generated and actually consumed by the homeowner that would displace all or a portion of the electric utility bill; 4) The final construction cost.
A homeowner that is able to take advantage of all of the incentives to their maximum should be able to realize simple paybacks of less than 10 years.