3 options for covering the cost of solar panels
We’re sure you already know that having solar power as your electricity source is a great way to save on your energy bills. But given that solar panels can cost thousands, taking that first step can be daunting.
If you’re thinking of making the switch to solar, we’re jotted down three ways you can cover the cost, plus their pros and cons.
Your savings
Using your hard earned savings to purchase solar panels is one of the simplest ways to get your journey started. By using your savings, you’ll avoid getting in debt, given it’s money you already have. But depending on how much you are willing to contribute toward this savings goal each month, getting your panels installed might take a longer than anticipated.
Take some time to revisit your monthly budget to determine how much you can afford to contribute toward your solar panels.
Mozo Energy Tip: If you are looking to use your savings to front the cost of your solar panels, open a separate savings account dedicated to your goal. This way, you will keep the funds out of reach and can avoid temptation to spend the money.
Green personal loans
A green personal loan is a type of personal loan that is made to just be used for ‘green’ purchases, like solar panels and batteries. The good news is that lenders generally offer better rates on green personal loans and it would allow you to have your solar panels almost instantly.
According to the Mozo database, the average green personal loan rate current sits at 7.01%, while the average standard unsecured personal rate is 10.32%. Major bank, CommBank even recently announced its own version of a green loan, featuring a 0.99% fixed interest rate for 10 years. The bank has also said that there will be no establishment or monthly fees, plus no penalty for early repayment.
While a low rate and minimal fees does sound ideal, keep in mind that as this is still a credit product, you are required to pay interest. And depending on how much you intend to borrow, this can cost you a small fortune over the loan term.
Mozo Energy Tip: As there a range of of green loan options available, it’s important to compare your options to guarantee yourself the right deal for you.
Government rebates
To ease the financial burden of solar panels, various government incentives were introduced across the country. These incentives and rebates cover the portion of the cost for solar panels, which can significantly reduce the total cost.
The state or territory you live in will determine the rebates or grants you are able to receive. For instance, Victorian households are able to apply for the Solar Panel Rebate, which provides a rebate of up to $1,850 for a solar PV system, while South Australians have access to the Home Battery Scheme that provides a subsidy for solar batteries.
Just keep in mind that rebates typically have a certain eligibility criteria you need to provide in order to be approved.
Mozo Energy Tip: Depending on your state or territory, there are a limited amount of rebates available for each ‘round’. So if you are keen to apply, be sure to get in quick!
Find out if renewable energy is the right fit for your household by checking out our renewable energy FAQs guide.
