--- description: Changes in Electric Bill Before and After Solar Panels: A 5 kW residential solar system can reduce monthly bills by around $100 to $150. title: Understanding Electric Bill Before and After Solar Panels: Changes and Savings - Energy Theory image: https://energytheory.com/wp-content/uploads/2023/09/JAN23-changes-in-electric-bill-before-and-after-solar-panels.jpg --- [ Close Menu ](#) * [About](https://energytheory.com/about-us/) * [EV](https://energytheory.com/category/electric-vehicles/) * [FAQs](https://energytheory.com/category/faqs/) * [Glossary](https://energytheory.com/category/glossary/) * [Green](https://energytheory.com/category/green/) * [Renewable](https://energytheory.com/category/renewable/) * [Sustainable](https://energytheory.com/category/sustainable/) * [Energy Economy](https://energytheory.com/category/energy-economy/) * [Energy Services](https://energytheory.com/category/energy-services/) * [Solar](https://energytheory.com/category/solar/) * [Sustainable](https://energytheory.com/category/sustainable/) * [News](https://energytheory.com/category/latest-news/) * [Language](#) [ ![Energy Theory](https://energytheory.com/wp-content/uploads/2022/11/2e3rtgthghnm.png) ](https://energytheory.com/ "Energy Theory") ![en](https://cdn.gtranslate.net/flags/svg/en.svg)English [![es](https://cdn.gtranslate.net/flags/svg/es.svg) Spanish](#) [![fr](https://cdn.gtranslate.net/flags/svg/fr.svg) French](#) [![en](https://cdn.gtranslate.net/flags/svg/en.svg) English](#) [![it](https://cdn.gtranslate.net/flags/svg/it.svg) Italian](#) [![zh-CN](https://cdn.gtranslate.net/flags/svg/zh-CN.svg) Chinese (Simplified)](#) [![nl](https://cdn.gtranslate.net/flags/svg/nl.svg) Dutch](#) [![fi](https://cdn.gtranslate.net/flags/svg/fi.svg) Finnish](#) [![de](https://cdn.gtranslate.net/flags/svg/de.svg) German](#) [![hi](https://cdn.gtranslate.net/flags/svg/hi.svg) Hindi](#) [![ja](https://cdn.gtranslate.net/flags/svg/ja.svg) Japanese](#) [![pl](https://cdn.gtranslate.net/flags/svg/pl.svg) Polish](#) [![pt](https://cdn.gtranslate.net/flags/svg/pt.svg) Portuguese](#) [![ru](https://cdn.gtranslate.net/flags/svg/ru.svg) Russian](#) [ ![Energy Theory](https://energytheory.com/wp-content/uploads/2022/11/2e3rtgthghnm.png) ](https://energytheory.com/ "Energy Theory") ![en](https://cdn.gtranslate.net/flags/svg/en.svg)English [![es](https://cdn.gtranslate.net/flags/svg/es.svg) Spanish](#) [![fr](https://cdn.gtranslate.net/flags/svg/fr.svg) French](#) [![en](https://cdn.gtranslate.net/flags/svg/en.svg) English](#) [![it](https://cdn.gtranslate.net/flags/svg/it.svg) Italian](#) [![zh-CN](https://cdn.gtranslate.net/flags/svg/zh-CN.svg) Chinese (Simplified)](#) [![nl](https://cdn.gtranslate.net/flags/svg/nl.svg) Dutch](#) [![fi](https://cdn.gtranslate.net/flags/svg/fi.svg) Finnish](#) [![de](https://cdn.gtranslate.net/flags/svg/de.svg) German](#) [![hi](https://cdn.gtranslate.net/flags/svg/hi.svg) Hindi](#) [![ja](https://cdn.gtranslate.net/flags/svg/ja.svg) Japanese](#) [![pl](https://cdn.gtranslate.net/flags/svg/pl.svg) Polish](#) [![pt](https://cdn.gtranslate.net/flags/svg/pt.svg) Portuguese](#) [![ru](https://cdn.gtranslate.net/flags/svg/ru.svg) Russian](#) [Solar](https://energytheory.com/category/solar/) # Understanding Electric Bill Before and After Solar Panels: Changes and Savings Solar savings vary with system size, as larger installations harness more sunlight, resulting in reduced billing amounts. By [Olivia Bolt](https://energytheory.com/author/olivia%5Fbolt/)November 17, 20238 Mins Read ![JAN23 changes in electric bill before and after solar panels](https://energytheory.com/wp-content/uploads/2023/09/JAN23-changes-in-electric-bill-before-and-after-solar-panels-1024x683.jpg "Understanding Electric Bill Before and After Solar Panels: Changes and Savings") Initially, solar panels are expensive to install, but in the long run, they prove to be quite valuable. They have the potential to reduce your utility bills, resulting in significant savings over time. In this blog, we will examine the changes in electric bill before and after solar panels, as well as the monthly and yearly savings you can expect. ## **What Changes in Electric Bill Before and After Solar Panels?** Solar panels are priced based on their wattage, which means that the cost of a solar system increases consistently as it becomes larger. The **savings generated by your solar installation will vary depending on its size**, as larger systems have a greater capacity to harness sunlight. The efficiency and overall value of solar panels are heavily influenced by the angles at which they are installed. It is essential to consider the factors influencing the bill before and after solar panels. ### **1\. Potential of Your House’s Solar Energy Exposure** ![solar panel new image](https://energytheory.com/wp-content/uploads/2023/08/Solar-panel-new-image.jpg) The annual amount of sunlight your home receives will play a crucial role in determining the extent of your savings generated by installing solar panels. **Homes located in the Southwest, such as Nevada, receive abundant sunlight** that radiates intensely all year round. This remarkable solar exposure bestows upon them an exceptional potential to harness solar energy. However, the presence of nearby obstructions that cast shadows on your home can significantly diminish its solar potential. Furthermore, it is important to note that south-facing roofs in the **Northern Hemisphere hold a significantly greater potential for harnessing solar energy** compared to their north-facing, thereby **earning more savings.** **Also Read:** [How to Calculate Solar Panel Tilt Angle?](https://energytheory.com/how-to-calculate-solar-panel-tilt-angle/) ### **2\. Size of Your Solar System** The size of your solar installation directly **impacts its ability to substantially reduce your electricity bill.** Bigger installations have the capacity to capture a greater amount of sunlight, resulting in even more significant reductions in your bill compared to smaller ones. Overall, the efficiency and output capacity of your solar system influence the amount of energy supplied, thus, affecting the electricity bill at large. ### **3\. Type of Solar System** ![Off grid](https://energytheory.com/wp-content/uploads/2023/08/off-grid-pic.jpg) There are on-grid, [off-grid](https://energytheory.com/what-is-off-grid/), and hybrid solar systems. Your electricity bill is influenced by the type of system you have. If your location permits you to completely go **off-grid with solar panel installation, then you won’t have any electricity bills.** But if you opt for an on-grid system, the bill will be charged as per your electricity consumption from the grid. ### **4\. Energy Consumption by Your House** This is a crucial factor because your electricity consumption pattern influences your bill. If your consumption is more during the day when there is a constant supply of solar power, and **less consumption at night when using the grid**. You will possibly receive a lower electricity bill. Therefore, considering these factors, you can effectively lower your electric bill and you will notice the changes in electric bill before and after solar panels. **Also See:** [Solar Panels Not Reducing Bill: Common Issues and Solutions](https://energytheory.com/solar-panels-not-reducing-bill/) ### **How Do Solar Panels Work with Your Electricity Bill?** ![JAN23 changes in electric bill before and after solar panels 1](https://energytheory.com/wp-content/uploads/2023/09/JAN23-changes-in-electric-bill-before-and-after-solar-panels-1.jpg) The working of the solar panels with your electricity bill depends on the type of system you use, electricity consumption, and sunlight exposure**.** Solar panels work to **generate electricity** as per their efficiency and the amount of sunlight they receive. This energy is used by you and at night, solar panels stop working, and your loads work on grid energy. Therefore, you will have to **pay for the grid power used at night.** Yes, it is normal to have an electricity bill even when you install a solar power system. If the conditions are appropriate, then the electricity part of the bill equates to zero, and you will **only have to pay the utility charges** **of the installer.** Moreover, if you **reduce your energy usage** and invest in a [net meter](https://energytheory.com/what-is-a-net-meter/), you can save a lot. In the case of net metering, you can get paid by the government for the extra energy your system generates. In that case, extra power generated by your solar system is fed into the grid and not used by your loads. Thus, you **get paid for that surplus energy** supplied back to the grid. In short, the **electricity bill can be reduced** in the following cases: * Maximum efficiency of solar panels. * Your electricity consumption in the day is less than the electricity generated by solar panels. * Extra energy is stored in solar batteries. * Extra energy is sent to the utility grid with net metering. * Less use of electricity during night or in cloudy weather than you have in your batteries (or you have net metering to cover this). With this, your energy bill can be reduced more towards month end. In this way, using solar panels can save a significant amount per year. **Also See:** [Does Inverter Increase Electricity Bill?](https://energytheory.com/does-inverter-increase-electricity-bill/) ### **What is the Average Monthly Electricity Bill with Solar Panels?** The amount of money saved by solar panels can vary depending on different factors such as state electricity rates, [average sun hours](https://www.currentresults.com/Weather/US/average-annual-state-sunshine.php), usage, and local incentives. The changes in electric bill before and after solar panels also varies from state to state. In the United States, states with an average monthly usage below 965 kWh can rely on a 7.15 kWh solar array to fully meet their electricity needs. The potential monthly savings would match the average electricity bill in these states. To calculate the potential savings in states where the average monthly usage exceeds 965 kWh, we can simply multiply this power output by the average electricity rate specific to each state. For example, by installing a solar array in an average **Alabama home**, generating 965 kWh of energy at a rate of 12.96 cents per kWh, you can enjoy impressive monthly savings of $125.06. \= 965 kWh average solar array output ×— $0.1296 cents per kWh = **$ 125.06**. **Note:** This is not a fixed amount and is subject to change. **Also read:** [How Do I Know How Much Electricity My Solar Panels Are Generating?](https://energytheory.com/how-do-i-know-how-much-electricity-my-solar-panels-are-generating/) ### **How Much Money can Solar Panels Save You?** ![savings in electricity bill](https://energytheory.com/wp-content/uploads/2023/09/JAN23-savings-in-electric-bill.jpg) In general, on average, solar panels can save around 90% of electricity bill. The **minimal amount you will be paying is the mandatory utility charges.** So, how much money can solar panels save you depends on the efficiency of your solar panel and your consumption. The amount of generated electricity has to be consumed by managing and monitoring your usage by various appliances. A typical **5 kW residential solar system** **can potentially reduce monthly bills by $100 to $150 approximately**. However, it can fluctuate as it varies with the size of the solar array, your local energy rates, electricity consumption, weather conditions, and solar panel orientation. For a better understanding, check out our blog – [How Much Does Solar Panels Save On Electricity Bills](https://energytheory.com/how-much-do-solar-panels-save-on-electricity-bills/) ### **How Much Money Can Solar Panels Save Per Month?** You already know about the factors influencing the changes in electric bill before and after solar panels. Here is an estimated list of the average price of electricity per kWh for some US states. Go through it to see how much money can be saved with solar panels per month. **1\. Average Price per kWh: 10-15 cents approximately** * Washington, * Colorado, * Florida, * Georgia, * Illinois, * Texas, * Mississippi, * New Mexico, * North/South Carolina, * Pennsylvania **2\. Average Price per kWh: 15-20 cents approximately** * Maine, * Michigan, * New Hampshire, * New Jersey, * New York, * Vermont **3\. Average Price per kWh: more than 20 cents** * Alaska, * California, * Connecticut, * Hawaii, * Massachusetts, * Rhode Island Therefore, depending on your monthly usage and the Avg price per kWh in your state, **monthly savings can be in the range of $80.87 to $177.78**. **Also See:** [Solar Panels Not Reducing Bill: Common Issues and Solutions](https://energytheory.com/solar-panels-not-reducing-bill/) ### **How Much Money Can Solar Panels Save Per Year?** ![JAN23 changes in electric bill before and after solar panels 4](https://energytheory.com/wp-content/uploads/2023/09/JAN23-changes-in-electric-bill-before-and-after-solar-panels-4.jpg) Keeping in mind the factors affecting solar system output, we can estimate the yearly savings based on **rough assumptions.** By installing a solar system that generates **10,000 kWh per year**, homeowners paying an electricity rate of **16 cents per kWh can expect to save a substantial $1,600 annually.** On the other hand, a system of equal size that generates 8,000 kWh annually, despite being located in an area with less sunshine, has the potential to save around $1,600\. This substantial amount is achievable when the electric rates are higher, let’s say 20 cents per kWh. These changes are noticed in electric bills before and after solar panels. Moreover, if your state offers solar tax incentives, and [federal solar tax credits](https://energytheory.com/what-is-the-federal-solar-tax-credit/), along with state and local incentives then you can save more on solar panel installation and electricity bills in the long run. **Note**: All the above-mentioned prices and bill amounts may differ on prevailing electricity rates, location, incentives, and solar panel system efficiency. The amount of money you can save with solar panels is subject to a range of factors. These include state electricity rates, the average hours of sunlight in your area, energy consumption patterns, and any local incentives or rebate schemes available. For even greater savings, you can adopt energy-efficient practices and invest in a net meter. By doing so, you can achieve substantial long-term reductions on your utility bills. To explore more solar-related content, keep browsing our website. **Source:** [Electricity Bills After Solar Installation](https://nationalgridsupport.com.au/electricity-bills-after-solar-installation/) Share. 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She takes part in environmental conservation by recycling and avoiding single-use plastic. #### Related Posts [![](https://energytheory.com/wp-content/uploads/2024/09/Large-Area-PV-Solar-Modules-with-12.6-Efficiency-with-Nickel-Oxide-by-Italian-Scientists-300x200.png "Large-Area PV Solar Modules with 12.6% Efficiency with Nickel Oxide by Italian Scientists")](https://energytheory.com/large-area-pv-solar-modules-with-12-6-efficiency-with-nickel-oxide-by-italian-scientists/ "Large-Area PV Solar Modules with 12.6% Efficiency with Nickel Oxide by Italian Scientists") #### [Large-Area PV Solar Modules with 12.6% Efficiency with Nickel Oxide by Italian Scientists](https://energytheory.com/large-area-pv-solar-modules-with-12-6-efficiency-with-nickel-oxide-by-italian-scientists/) September 25, 2024 [![Why is There So Much Fear Surrounding LiPo Batteries](https://energytheory.com/wp-content/uploads/2024/09/lipo-batteries-fear-300x200.webp "Why is There So Much Fear Surrounding LiPo Batteries?")](https://energytheory.com/why-is-there-so-much-fear-surrounding-lipo-batteries/ "Why is There So Much Fear Surrounding LiPo Batteries?") #### [Why is There So Much Fear Surrounding LiPo Batteries?](https://energytheory.com/why-is-there-so-much-fear-surrounding-lipo-batteries/) September 11, 2024 [![What is the Difference Between VCC, VDD, VEE, and VSS?](https://energytheory.com/wp-content/uploads/2024/09/VCC-300x200.webp "What is the Difference Between VCC, VDD, VEE, and VSS")](https://energytheory.com/what-is-the-difference-between-vcc-vdd-vee-and-vss/ "What is the Difference Between VCC, VDD, VEE, and VSS") #### [What is the Difference Between VCC, VDD, VEE, and VSS](https://energytheory.com/what-is-the-difference-between-vcc-vdd-vee-and-vss/) September 10, 2024 [Add A Comment ](#) Leave A Reply [Cancel Reply](https://energytheory.com/what-changes-in-electric-bill-before-and-after-solar-panels/#respond) Save my name, email, and website in this browser for the next time I comment. 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