Ohio has experienced a surge in solar energy development in recent years, with installed capacity growing from just 13 megawatts (MW) in 2010 to over 900 MW by the end of 2022, according to data from the Solar Energy Industries Association (SEIA). This ranks Ohio 18th nationally in total installed solar capacity and supports over 7,500 solar jobs across the state.
But this is just the beginning for the Buckeye State‘s solar potential. SEIA projects that Ohio will add another 2,466 MW of solar capacity over the next 5 years, more than tripling its current total. This growth is being driven by falling solar costs, strong state incentives, a growing demand for clean energy, and ambitious renewable energy commitments from major Ohio corporations like Cargill, JPMorgan Chase, and Lowe‘s.
For Ohio homeowners considering going solar, there has never been a better time. The average residential solar panel system in Ohio costs about $2.50 per watt, compared to $2.66 per watt nationally. At that price, a typical 6 kilowatt (kW) system would cost $15,000 before applying any incentives or rebates. After the 30% federal solar tax credit, the net cost drops to just $10,500.
Over the 25-30 year lifespan of a solar panel system, the average Ohio household can save over $19,000 on electricity costs by going solar. So while the upfront investment may seem steep, the long-term financial benefits are compelling – especially when considering likely future increases in utility electricity rates.
Ohio‘s Solar Market and Electricity Mix
To understand the growing role of solar energy in Ohio, it‘s helpful to look at the state‘s overall electricity generation mix. As of 2021, Ohio generated about 81% of its electricity from fossil fuels (37% coal, 44% natural gas), 15% from nuclear, and just 4% from renewables. Of that renewable share, wind accounted for 2.5%, while solar was less than 1%.
However, this mix is rapidly changing as coal plants retire and renewable energy surges to replace them. From 2010 to 2021, Ohio‘s electricity generation from coal fell by 58% while natural gas more than doubled and renewable energy grew by over 500%. Solar energy is projected to make up an increasingly larger share of Ohio‘s renewable mix in the coming years.
Ohio‘s solar market has historically been dominated by utility-scale projects, but residential installations are catching up quickly. The Ohio Public Utilities Commission reported that the state added nearly 250 MW of new residential solar capacity in 2022 – a 37% increase from the previous year. This growth is being enabled by a maturing solar industry that is serving customers in every county across the state.
Solar Panel Cost Comparison
The average Ohio home uses about 873 kilowatt-hours (kWh) of electricity per month, well below the U.S. average of about 893 kWh. At Ohio‘s average residential electricity rate of $0.1319 per kWh (as of January 2023), that works out to a monthly bill of about $115 or $1,380 per year.
By comparison, a 6 kW solar panel system in Ohio will produce about 7,200 kWh per year on average (600 kWh per month). At $2.50 per watt, the total cost of such a system would be about $15,000 before incentives. But the 30% federal solar tax credit would reduce the net cost to $10,500. Ohio also exempts the value of solar panel systems from property taxes, which can save hundreds of dollars per year.
Assuming the solar panels offset 100% of the home‘s electricity usage, the $1,380 in annual electricity savings would pay off the $10,500 net cost of the system in about 7.6 years. After that, the savings continue to accrue for the remaining 18+ years of the system‘s warranted lifespan. Here‘s how the numbers pencil out over 25 years:
- Total electricity costs without solar (25 years): $46,725
- Total electricity costs with 6 kW solar (25 years): $10,500
- Net 25-year savings with solar: $36,225
- Average annual return on investment (ROI): 12.7%
And these figures are based on today‘s electricity prices. If Ohio utility rates rise by just 2% per year, the 25-year savings would increase to over $44,000 with an ROI of 14.5%. For perspective, the average annual return of the S&P 500 stock market index over the past 25 years is about 10%.
Of course, actual solar costs and savings depend on many factors including location, roof characteristics, shading, equipment type, financing, and incentives. In general, southeast Ohio offers the strongest solar economics due to higher electricity rates and sunlight levels. But solar can be a smart investment in any part of the state.
Solar-Friendly Policies and Incentives in Ohio
Ohio has several key policies that support the growth of solar energy and make it more affordable for homeowners:
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Net metering: Ohio utilities must credit solar homeowners for excess electricity sent to the grid at the full retail rate. This helps offset electricity costs when solar panels aren‘t generating enough power to meet the home‘s needs.
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Renewable portfolio standard (RPS): Ohio law requires investor-owned utilities to source 8.5% of their electricity from renewable sources by 2026, with a specific carveout of 0.5% for solar. This has created a market for solar renewable energy certificates (SRECs) that solar homeowners can sell to utilities for additional income.
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Property tax exemption: Ohio exempts the value of solar panel systems from property taxes, so installing solar won‘t result in a higher tax bill.
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Interconnection standards: Ohio has statewide rules that prohibit utilities from unreasonably denying or delaying solar interconnection requests. This ensures that solar homeowners can connect to the grid and take advantage of net metering.
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Solar access laws: Ohio‘s solar access laws protect the rights of homeowners to install solar panels on their property and prevent homeowners associations (HOAs) from banning them outright.
Together, these policies have helped Ohio‘s solar market grow by over 3,000% since 2010. And with the 30% federal solar tax credit extended through at least 2032, the economic benefits of going solar in Ohio have never been stronger.
Choosing the Right Solar Panels and Installer
Ohio homeowners have their choice of several types of solar panels, each with its own advantages:
- Monocrystalline panels are made from single silicon crystals and are the most efficient, but also the most expensive. They perform well in low-light conditions and have a sleek black appearance.
- Polycrystalline panels are made from multiple silicon crystals and are less efficient but more affordable than mono panels. They have a blue, speckled look.
- Thin-film panels are made from layers of photovoltaic material and are the least efficient but also the lightest and most flexible. They‘re often used on low-slope roofs that can‘t support the weight of traditional panels.
Given Ohio‘s less-than-ideal solar resource (about 4.2 peak sun hours per day on average), monocrystalline or high-efficiency polycrystalline panels generally make the most sense for Ohio homeowners who want to maximize electricity production. But budget, roof characteristics, and aesthetic preferences are also important considerations.
Equally important is choosing a reputable solar installer with experience designing and installing systems in Ohio. A few key things to look for include:
- NABCEP certification: The North American Board of Certified Energy Practitioners (NABCEP) offers a rigorous certification program for solar installers. An NABCEP-certified installer has demonstrated a high level of technical expertise and adherence to industry best practices.
- Strong track record: Look for an installer with several years of experience and a long list of successful projects in Ohio. Check reviews on sites like SolarReviews, EnergySage, and Google, and ask for references from recent customers.
- Quality equipment: The best solar installers use high-efficiency, tier 1 panels from leading manufacturers like LG, Panasonic, SunPower, and Q CELLS. Look for panels with a 25-year product warranty and a linear power output warranty of at least 85% after 25 years.
- Workmanship warranty: A good solar installer will stand behind their work with a strong workmanship warranty (at least 10 years) that covers any issues related to the installation, such as roof leaks or loose wiring.
- Financing options: Look for an installer that offers a range of financing options to fit your budget, such as cash purchase, solar loans, leases, and power purchase agreements (PPAs). Be sure to compare the lifetime costs and benefits of each option.
Environmental Benefits of Solar Energy
Beyond the financial savings, going solar in Ohio also offers significant environmental benefits. The average 6 kW residential solar panel system in Ohio will offset over 200 tons of carbon dioxide (CO2) emissions over its 25-year lifespan. That‘s equivalent to planting over 5,000 trees or taking more than 40 cars off the road for a year.
Solar energy also reduces other harmful air pollutants like sulfur dioxide, nitrogen oxides, and particulate matter that are emitted by fossil fuel power plants. These pollutants are linked to respiratory illnesses, heart disease, and premature death, and disproportionately impact low-income communities and communities of color.
By generating clean, renewable electricity on your rooftop, you can help reduce Ohio‘s reliance on fossil fuels and create a healthier, more sustainable future for all Ohioans.
The Future of Solar Energy in Ohio
Ohio‘s solar industry is poised for continued growth in the coming years, thanks to strong state policies, declining costs, and increasing demand for clean energy. By 2030, SEIA projects that Ohio will have over 5,000 MW of installed solar capacity – enough to power more than 600,000 homes.
This growth will also create thousands of new jobs in solar installation, manufacturing, sales, and related fields. As of 2021, Ohio‘s solar industry employed over 7,500 workers across 250 companies, according to the Ohio Solar Energy Association. These jobs pay an average of $20 per hour and offer opportunities for advancement and training.
To ensure that Ohio continues to reap the benefits of solar energy, it‘s important for state policymakers to maintain and strengthen supportive policies like net metering, renewable portfolio standards, and tax incentives. It‘s also critical to invest in workforce development programs that can train the next generation of solar installers and technicians.
By embracing solar energy as a key part of Ohio‘s energy future, we can create a cleaner, healthier, and more prosperous state for all.
Frequently Asked Questions
Q: How much do solar panels cost in Ohio?
A: As of 2023, the average cost of solar panels in Ohio is about $2.50 per watt, before incentives. For a typical 6 kW system, this works out to a total cost of about $15,000. However, the 30% federal solar tax credit can reduce the net cost to around $10,500.
Q: Are solar panels worth it in Ohio?
A: For most Ohio homeowners, yes. The average 6 kW solar panel system in Ohio will save over $36,000 on electricity costs over 25 years, assuming current electricity rates. If rates rise by just 2% per year, the savings increase to over $44,000. Solar panels also offer environmental benefits and can increase home value.
Q: How much sunlight does Ohio get for solar panels?
A: Ohio receives an average of about 4.2 peak sun hours per day, which is less than some sunnier states but still sufficient for solar panels to be economically viable. Southeast Ohio generally has the best solar potential due to higher sunlight levels and electricity rates.
Q: What is the payback period for solar panels in Ohio?
A: The payback period for solar panels in Ohio depends on several factors, but is typically around 8-10 years. After that, the savings from reduced electricity bills continue to accrue for the remaining 15-20 years of the system‘s lifespan.
Q: Can you get a tax credit for solar panels in Ohio?
A: Yes, the federal government offers a 30% solar investment tax credit (ITC) for residential solar panel systems installed through 2032. The credit drops to 26% in 2033 and 22% in 2034 before expiring completely in 2035, unless renewed by Congress.
Q: What are the best solar panels for Ohio?
A: The best solar panels for Ohio are typically high-efficiency monocrystalline or polycrystalline panels from tier 1 manufacturers like LG, Panasonic, SunPower, and Q CELLS. These panels perform well in Ohio‘s relatively low-light conditions and come with strong warranties.
Q: How long do solar panels last in Ohio?
A: Solar panels are very durable and are designed to last 25-30 years or more with proper maintenance. Most solar panels come with a 25-year production warranty that guarantees a certain level of power output (usually 85-90% of the original output) after 25 years.
Sources and Further Reading
- Solar Energy Industries Association (SEIA) – Ohio Solar
- Ohio Solar Energy Association (OSEA) – Ohio Solar Jobs Census 2021
- Ohio Public Utilities Commission (PUCO) – Net Metering Rules
- EnergySage – Ohio Solar Panels
- U.S. Energy Information Administration (EIA) – Ohio State Energy Profile
- Lazard – Levelized Cost of Energy Analysis (LCOE 15.0)
