With solar energy becoming cheaper – and federal and state authorities offering tax credits and other incentives – now is a good time to switch

How to install solar panels at home – to save the Earth and your bank account

Installing solar panels on the roof of your home is a big project – but it can pay dividends in more ways than one. There’s the obvious environmental benefit, but for many homeowners, the joy comes with a dollar sign attached.

Turning your home into a mini power plant can save you good money on the electric bill. Here is a guide to get you started.

An average, 5-kilowatt system will cost about $15,000 to $20,000, depending on where you live in the US. So it pays to find out if your state or utility offers rebates or other incentives to help lower the cost of going solar. Here is a sure bet: the federal government offers a 30% tax credit (though it’s set to decline starting in 2020).

You can start your research with this federally funded, comprehensive database that lists all sorts of incentives and policies for renewable energy by state. If that seems daunting, then begin your homework by contacting the state agency that regulates utilities.

Some states with strong policies to promote solar energy use, such as California, New York and Massachusetts, have created their own websites listing incentives, financing options and tips for hiring a contractor to install the solar panels. Your utility might offer a similar helpful guide.

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As with any major home improvement project, finding a good contractor is crucial. A trustworthy installer will secure the necessary permits, properly connect the solar energy system to your home and the local electric grid, and apply for incentives for you.

Some states – or local utilities – post a list of certified solar service companies. Many consumers ask friends and neighbors for recommendations. Googling works just as well. Regardless of the approach, you should always get several quotes and chat with the installers to find a good match.

Another big decision is how to pay for the equipment and services. You can pay for them outright, of course. A solar energy system lasts about 20 years, so paying for it upfront will be a cheaper option over time than to lease it. As an owner, you get a bonus incentive if you live in a state that allows you to sell excess solar electricity to your utility. The money you earn will show up as a credit on your bill.

Another popular option is to leave the ownership and maintenance of the solar panels to your installer (and its investors) and pay only for the electricity produced from the rooftop system. This arrangement is done through what’s commonly called a power purchase agreement, which can last 15 years or more. Your solar company typically sweetens the deal by charging you a lower electric rate than your utility would. Be sure to read the contract to see how your installer sets the electric rates over time. Those rates are likely to change.

The solar energy market is growing because the average price for solar energy systems has fallen so much – 54% between 2010 and 2016, according to GTM Research. While your solar panels may not produce all the electricity you need, they are becoming a good investment to lower your bill.