Household Solar Returns Benchmarked Against Other Asets

The average payback across different solar providers and regions is currently 6 to 12 years (avoiding predatory financing is a way to tip this in your favor, which we will discuss more in the future). If we compare that against the expected asset class returns from GMO (normalizing for inflation), then you can see that rooftop solar competes with the top expected returns and is still in the middle of the pack if you are planning to sell in 9 years (slightly above average time to change homes). That’s a pretty good trade right now if you know that other things keep you in your home. Part of this is because current higher valuations across other asset classes make forward returns for solar look more appealing, but that doesn’t mean it’s not fair/likely if those other markets have already pulled forward returns.

Zillow and others have also pointed to data that suggests rooftop solar can increase the value of a home by ~4%, which would be slightly higher than our estimates for the ascribed value above. Regardless, it means there are a couple of ways to win.