We want to congratulate you on considering switching to renewable energy! Sadly, there aren’t many homeowners in Toronto who use solar energy, but the demand is growing.
Luxury homes, whether they’re in the Bridle Path or Rosedale, offer many attractive features, including inground swimming pools, fountains, garages for two or more vehicles, and lush landscaping. Solar panels are another feature that may be beneficial to homeowners. However, the value will largely depend on your specific situation, so read carefully if you are giving solar panels a serious look!
As one of Toronto’s luxury real estate brokers, Susan can help you become more informed about solar technology and whether or not it’s the right move for you.
What Is Solar Power?
Compared to other sources of renewable energy, solar power is the most abundant. Silicon solar panels are used to absorb the sun’s rays and transform it into electricity. This conversion is called a photovoltaic effect.
Broad and flat roofs are the best structure for installing solar panels. Alternatively, you can install them on spare land. If you have a larger amount of space available, you can install a single large panel, or several panels.
Nuclear power and hydroelectricity are the dominant forms of energy in Canada because of our long winters and limited amount of sunlight. According to The Independent Electricity System Operator (IESO), Ontario used 90.4 TWh of nuclear power and 36.4 TWh of hydro power in 2019. Solar energy, by contrast, only saw 0.7 TWh used during the same period.
Nuclear energy is nonrenewable, so by switching to a renewable energy source, you will be doing the planet a favour. However, while it’s true that you can lower your monthly electricity bill by using solar energy, it is by no means assured.
Is it Worth Installing Panels?
To decide if solar panels are right for you, it’s important to weigh the costs against the potential benefits. Stay aware of the following general principles before you take any concrete steps.
You Can Sell Excess Energy Back to the Grid
You can do this a couple of different ways in Ontario.
The microFIT program, which stands for “Feed-in Tariff,” was designed for anyone generating renewable energy with a capacity of 10 kilowatts or less. Under this initiative, homeowners are paid a guaranteed price for their electricity generation over a 20-year period. This can be more beneficial if you negotiated the guaranteed price while the cost of electricity was high. MicroFIT is subject to HST.
The other way to sell your energy back to the grid is through what is called the net metering program, one in which homeowners receive credits for the excess energy their solar panels generate. The credits are applied to their monthly bills, and they only pay the “net” amount owing each month. The net metering program is not subject to HST.
The potential benefit of selling your excess power back to the grid is that it is possible to make money while being environmentally responsible. The potential drawback is that selling your energy back to the grid may cost you more over the long term than doing nothing at all. This is especially true if you incorporate the yearly fees for remaining registered in these programs.
You Should Weigh All Associated Costs
Going solar is a complex investment.
Unfortunately, Ontario doesn’t offer incentives for switching to solar technology, as some other provinces do. However, over the course of a solar panel’s lifetime, it is possible for homeowners to save thousands of dollars.
That said, it is also possible to lose money. While the cost of panels has gone down and will continue to do so as more innovations are made in solar technology, there are a number of important considerations to be made.
- Installation Costs: Solar panel installations can cost anywhere from hundreds to thousands of dollars, depending on your home and the scope of your solar project.
- Maintenance Costs: A solar panel can have a lifespan of up to 25 years. However, there is no guarantee that the company you used to install your panels will still exist in 25 years. Any future work that needs to be done might have to come out of your own pocket, even if those costs were originally covered in your installation agreement.
- Insurance Costs: Getting insurance can be difficult, according to some real estate professionals with experience in this area. It may be overly costly to obtain.This may be related to the risk of fire, as the live wires on the roof can be dangerous, or the risk of animals nesting in the equipment. Fire fighters may not attend a fire in a home if there are solar panels.
- Resale Issues: When selling your house in the future, having solar panels may slow down the process, as houses with solar equipment tend to stay on the market longer than ones that don’t have any solar equipment. There is also the issue of aesthetics. Some consider solar equipment an eyesore, which may also affect sale prices down the road.
- Related Costs: When your roofing needs to be replaced, or if maintenance work needs to be done, solar panels will complicate issues and raise the overall cost. For that reason, it is highly recommended that you only install panels on a (relatively) new roof.
- Phantom Savings: Not all solar panel electricity cost savings are equal. In many cases—
especially if you’re renting the solar equipment as opposed to buying it outright—the projected savings can be skewed by the size of the rental costs. The numbers are often based on families of a certain size and with a certain average energy use. If your family happens to be on the small side, or if you don’t use a lot of electricity to begin with, those savings expectations might have to be significantly altered.
While many homebuyers are starting to embrace solar technology, it is clear from the elements mentioned above that any move in this direction should be approached with caution. Speak to experts in the field (contractors, insurance providers, lawyers) before taking any concrete steps.
Find the Right Home Today!
Susan’s knowledge of the Toronto housing market and trends is vast.
She is one of the best choices of brokers to consult with when you have concerns, such as how amenities affect your home’s value. Susan is happy to help you search through Downtown, Midtown, North York, and North Toronto real estate options, so you find your forever home.
She continues to assist buyers and sellers during the COVID-19 crisis. Contact her today!