This old solar-optimized house

Using our own real-life example - Fortune senior writer Michael Copeland, who just put solar in his Berkeley, Calif., home - we touch on the big questions you might have before taking the leap.

By Todd Woody, Fortune

Should I go solar?

(Fortune Magazine) -- It still often makes more environmental than economic sense, but solar can be a hedge against future electric rate rises. Plus, a solar array may boost your home's resale value. When Copeland financed his new house, the appraiser bumped up the value by $12,875 because of the solar panels.

How much is it going to cost?

It depends on where you live. California, Connecticut, New Jersey, and New York offer generous incentives. For instance, Copeland's 3.6-kilowatt array retailed for $25,750 installed. His net cost was $16,016 after a $7,734 rebate from the state and a $2,000 federal tax credit (see rebates by state at dsireusa.org). Typically a solar "systems integrator" determines how much solar energy you need, designs the array, and installs the equipment. Half the cost comes from the installation, notes Barry Cinnamon, CEO of Akeena Solar, a solar-systems integrator in California. Copeland considered buying SunPower's high-efficiency panels, which would have meant a smaller array, but went with less high-tech (but cheaper) Sharp.

How big a solar array do I need?

The size of your home isn't as important as how much electricity it consumes. A 2,000-square-foot house in Phoenix blasting the air-conditioner 24/7 may need a larger array than a McMansion in Maine. Online solar calculators like FindSolar (www.findsolar.com) will ballpark the size you need based on past electricity usage. Calibrating the array to your family's power demands is crucial, particularly if you live in a state that offers net metering.

What is net metering?

It allows you to offset your utility bill by feeding excess electricity back to the power grid. Sweet! But beware: Net-metering states allow consumers only to zero out their electricity bills - they don't pay for any electricity produced. Install too large a solar array and you'll be giving your local utility free electricity; install too few panels and you'll end up stuck paying for some power.

Financing options?

Solar home-equity loans let you avoid the capital expense of going solar. Such loans really make sense if the estimated savings on your utility bill and the tax deduction for the loan exceed the monthly payments. "We've had customers that on day one were $100 a month ahead," says Peter Liu of San Francisco's New Resource Bank, which offers financing to SunPower's residential customers.

Will the solar panels I buy today be obsolete?

Eventually, but not tomorrow. Technology has been steadily improving, and solar cells are also beginning to be built into roofing materials themselves. But even old arrays can be put to new uses. When plug-in hybrid and all-electric cars arrive in a few years, your solar panels may even supply you with free fuel. Top of page

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.