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Getting off the grid
5 Tips Home Edition: What you need to know before converting to solar energy.
By Gerri Willis, CNNMoney.com contributing columnist

NEW YORK (CNNMoney.com) - Wish you could sever the ties to your electric company? With alternate energy it may just be possible.

In today's Five Tips Home Edition, we're going to tell you what you need to know before going solar.

1. Measure your sunshine

Before you even start dreaming about installing solar paneling, make sure your home is basking in sunshine. Your roof should face south and you should live in an area that doesn't have a lot of trees in the way.

Homeowners who live in sunny areas like Arizona or California are going to get more bang for their buck than someone in Massachusetts or New Jersey. If you live in Nevada, for example, you'll get 50 percent more out of your solar energy panels than if you lived in Seattle or Maine.

Put your solar paneling in a place that gets the most sun at all times of day, even if that is a spot in your yard, says George Douglas of the National Renewable Energy Laboratory.

Of course, to really measure your savings, you'll need to calculate your electricity prices.

2. Weigh the costs

It's going to take you 15 to 20 years to make up the money you initially spent to install solar panels. Costs range from $14,000 to over $35,000. And it's unlikely you'll ever be able to save money, unless you can sell your unused energy back to the utility company, says Douglas.

About 40 states let you do this, including California, Maryland, Colorado and New Jersey. There are some federal and local rebates check out www.dsireusa.org to see what's in your area, but you'll really need to sit down with your energy bill to crunch the numbers.

3. Replace your water heater

If you want to make a gradual shift to solar energy, it may be worth your while to invest in solar water heaters after your conventional water-heater conks out (especially given the run up in natural gas prices). The payback for solar water heaters is much quicker at about five to six years.

Solar water heaters can provide up to 80 percent of your home's annual water-heating needs and should cut your utility bills by 50 to 80 percent. Keep in mind that solar water heaters do cost more than conventional electric or gas water heaters. They usually cost about $4,000 to $5,000 to install, says Rhone Resh of the Solar Energy Industries Association.

4. Don't pull off the grid entirely

While it's tempting to pull yourself off the grid entirely, you may want to start with a smaller system to supplement your main supply of electricity. You'll have fewer up-front costs and you'll also be able to gauge how much energy is needed to power the entire household.

It makes sense to get a system that meets most of your needs and rely on the grid for extreme energy usage than it does to purchase an oversized system you may not need. Don't forget, you can always add more panels later.

5. Check your warranty

Solar panels are under warranty for performance only. That means any storms, hurricanes, tornados or hailstorms that cause your solar cells to be ineffective will not be covered. These performance warranties generally last 25 years.

Your warranty may also be voided if you don't install the system correctly or keep up maintenance on the system - like not cleaning off stains. The solar water heating panels typically come with a five- to 10-year warranty, depending on manufacturer.

Make sure that if you do install solar panels, you let your insurance company know - you don't want to lose your money on this investment.

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Gerri Willis is a personal finance editor for CNN Business News and the host for Open House. Send your questions, your comments and your own ideas to us at 5tips@cnn.comTop of page



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