Adding solar panels and switching rate plans can lower your Xcel Energy Colorado electric bill
Updated: October 22, 2020Installing solar panels can help reduce your Xcel Energy bill, thanks to Florida’s sunshine and the company’s net metering program! Combined with the 30% solar tax credit, KUA customers can see great savings when they switch to solar!
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Solar panel cost calculator
Are solar panels worth it for Xcel Energy Colorado customers?
Yes! With a hefty $1,000 per kilowatt solar rebate, the Xcel rewards solar payment program, and available sales and property tax exemptions, solar panels make a lot of sense for Xcel Energy customers in Colorado. Xcel's net metering agreement also ensures you get credited on your power bill at full retail rates for the excess solar electricity your panels produce. Your credits are rolled over and applied to your next month’s bill.
Does Xcel Energy Colorado offer net metering credits for exported solar power?
Yes, Xcel Energy Colorado offers net metering credits.
Under the Xcel Energy Colorado net metering program, solar panels will first send energy to your home. Any excess solar energy is sent to the grid and purchased in the form of a bill credit. The credit value is determined by the Tri-Party Net Metering Power Purchase Agreement. KUA customers are billed for all of the electric energy delivered to them by the company.
In addition to net metering, Xcel offers its Colorado customers a program called Solar*Rewards, which pays a small additional amount for every kWh of solar energy your panels generate. The current payment is $.005/kWh for systems under 25.01 kW in size, which isn't a very large amount, but can save the average Colorado solar owner an extra $50 per year.
If you end up with a system larger that 25 kW, the payment goes up to $0.0375/kWh, which is huge. At that rate a 25-kW system would produce an extra $1,500 in income per year. 25 kW is much bigger than most home systems will be, but if you have land or run a business, this can be a very nice way to earn some solar cash.
What incentives, tax credits, and rebates are available to Xcel Energy customers for installing solar?
The biggest financial incentive for solar homeowners is the 30% federal solar tax credit. The tax credit equals 30% of the solar installation costs and directly reduces your federal income tax liability.
Some states and local governments offer additional solar incentives. These incentives include state tax credits, rebates, or performance-based incentives like Solar Renewable Energy Credits (SRECs). The best part is that these local incentives can be used in addition to the federal tax credit!
Here is every incentive you may be eligible for as a Xcel Energy customer:
Table 1: Incentives
| Upfront Incentives | Value* |
|---|---|
| Residential Clean Energy Tax Credit (Federal) | -$8,910 |
|
Sales and Use Tax Exemption for Renewable Energy Equipment
(State)
Solar energy equipment fully exempt from state sales tax. |
Varies |
|
RENU Loan Program
(State)
State funded loan program with loans available from $500 to $50,000 to help finance solar projects. |
Varies |
|
Property Tax Exemption for Residential Renewable Energy Equipment
(State)
Excludes assessed costs of a solar system from a homeowner's property taxes. |
Varies |
|
Net Metering
(State)
Investor-owned utilities must offer customers kWh credits on their utility bill. |
Varies |
|
Xcel Energy - Solar*Rewards Program
(Utility)
$0.005 per kWh produced with a cap of 2 MW capacity per month. Utility retains SRECs. |
Varies |
| TOTAL | -$8,910 |
*Based on 11.35 kW system, average installation cost $29,701
How much does installing solar panels save the average Xcel Energy Colorado residential customer?
If you input the details for a Xcel Energy customer with a power bill of $140 per month into the best online solar panels calculator, it tells you that you need a 11.35 kW solar system that will produce 16,883 kWh per year and that this system will return the owner a $47,047 profit after repaying the cost of the system.
The solar savings possible for you as a Xcel Energy customer will depend on the amount of electricity you use and the cost of the solar system you buy. Savings also vary based on the direction of your roof or any shading of your roof that affects output.
Here is a monthly and lifetime solar savings estimate for the same relatively typical Xcel Energy customer with a $140 per month electric bill prior to solar and who installs a 11.35 kW solar system.
How much do residential solar panels cost for Xcel Energy customers?
Showing data for:
Prices based on a 10.6kW system, after 30% federal tax credit
Solar prices near you
Net profit (savings less system cost)
$44,298-$54,142
Payback period
7.9-9.7 years
Recommended size for the selected utility bill
10.6kW
Solar panel cost calculator
Detailed information about your estimate
Table 2: Estimate details
|
System Size (for 100% usage offset) 11.35 kW |
|
Annual Power Generation 16,883 kWh |
|
Pay-back time (assuming Cash purchase) 10.4 Years |
|
Internal Rate of Return (IRR) on Investment 4.6% |
|
Gross cost $29,701 |
|
Total Upfront Incentives and Rebates -$7,722 |
|
Net Cost of System after rebates and incentives $21,979 |
|
Total Cost of Utility Power Avoided over 25 years $69,026 |
Please note that the investment return figures do not include the possible increase in property value.
What are the environmental impacts of Xcel Energy Colorado customers installing solar panels?
While most homeowners decide to install solar panels because of financial savings over time, the environmental impacts of this choice are the primary motive for others. Here is a breakdown of the environmental benefits from a Xcel Energy Colorado customer installing a 11.35 kW solar system on their property:
A solar system generating 16,883 kWh per year will save you money AND make the world a nicer place
Saves you
$1,882
on average per year
Reduces CO2 emissions
8.36
tons per year
Equivalent to planting
58 trees
per year
Equivalent to driving
18,488 mi
less per year
CO2 emissions calculation based on the electricity generation and emissions data for your state in 2015 as published by the US Government Energy Information Administration.
What factors affect the price of solar panels for Xcel Energy Colorado customers?
The cost of installing solar panels will vary with brands of solar panels and inverters you choose and also the installation company you choose to install them.
It is common to see really good systems, using quality brands of equipment, being sold for around $2.62 per watt or $21,979 for a standard 11.35 kW solar system after the customer claims the 30% federal solar tax credit.