Think a solar energy system will cost too much to install on your home? You might be surprised to learn that in some cases, depending on where you live, a solar installation can actually more than pay for itself.

Consider the example of a 4,000-square-foot home in Saratoga, Calif., southwest of San Jose. When the homeowners decided it was time to go solar they contacted Akeena Solar, a Los Gatos, Calif.-based designer and installer of solar power systems for homes and businesses. On the home's south-facing concrete tile roof, Akeena installed a 3-kilowatt solar energy system consisting of eighteen 165-watt solar energy modules. The system will provide about 4,064 kilowatt-hours annually, or about 340 kilowatt-hours per month.

Now here's where things gets interesting. The total cost for the installation was $26,604, which included all equipment, permits and labor. The homeowners received a $7,873 rebate from the California Energy Commission and $4,810 in combined federal and state tax credits. Net cost: $13,822.

The homeowners took out a loan to pay for the installation, with monthly payments of $54.51. However, with the solar energy system they saved $66.69 per month on their electric bill, resulting in a monthly positive cash flow of $12.18. The solar installation is not only paying for itself, but also puts a few extra dollars back into the monthly household budget. (The term of the loan is 30 years.)

An added bonus: The solar energy system will add to the home's value. Energy-saving improvements can increase a home's value by $20 for every $1 in annual energy usage, according to the Appraisal Institute.

Prior to installation, Akeena carefully analyzed the homeowner's energy bill, financial goals and aesthetic preferences, as well as the home's electrical system, the condition and orientation of the roof, and local weather conditions, and presented the homeowner with a 50-page report detailing the economics of the installation.

Keep in mind that local rebates and tax credits are key to reducing installation costs for any solar energy system. For that reason, Akeena currently installs systems only in the states of California, New York, New Jersey, Connecticut and Pennsylvania. In some cases, homeowners in those states could see even more cash-flow savings than the Saratoga homeowners. For more information: http://www.akeena.net or 888-253-3628.