Leasing Vs Buying Solar Panels
Solar leasing has become relatively popular as more people hope to save on their energy bills without having to pay a huge amount of money to purchase a solar panel system. However, leasing and buying both have pros and cons. You often pay more over time for solar leasing, with costs of between $50 and $250 a month. This makes the most sense if you have higher-than-average energy bills. This could be due to higher electricity costs in your area or because you use a lot of electric-based appliances, such as an HVAC system.
With leasing, monitoring and maintenance are included. This may give you peace of mind. With owning, you get a full return on your investment within 10 years. This can actually save you more money long-term than it would have with leasing.
Solar Panel Cost By State
As interesting as it is to look at the average solar panel cost in the United States, its also very helpful to understand what solar will cost in each state, as prices can vary significantly depending on where you live. Why? There are a number of reasons, but one important factor to keep in mind is system size.
In general, states where homeowners need to use air conditioning more often have more average electricity used per household. As such, some of the largest solar panel systems are installed in sunny, warm states like Arizona and Florida. Why does this matter? For solar installers, the larger your system, the less they will usually charge per kilowatt-hour . Its like buying in bulk at Costco you might pay a higher sticker price, but your per-unit costs are lower when you buy more at one time. Well dive into this phenomenon more below.
Back to solar panels. In the end, this very roughly translates to lower $/W pricing in warm states and higher $/W pricing in cold states. But in the end, total pricing is usually close to a wash warm states have a lower price per watt, but larger system sizes, and cold states have a higher price per watt, but smaller system sizes.
Table: cost of solar panels by state
NOTE: These ranges are system prices BEFORE the 26 percent federal tax credit for solar. Additionally, EnergySage does not currently provide quotes in all 50 states, which limits our ability to provide solar panel cost estimates in each.
Solar Panel Tax Benefits
For people who purchase and install a solar panel system, the federal government provides a 26% tax credit for solar panel installation through 2022. That credit will lower to 22% in 2023, and there isnt a tax credit for residential solar systems scheduled after that.
For example, you could receive a $5,200 credit on a $20,000 system in 2021 with the federal tax credit alone.
You can take advantage of tax benefits as long as you own your system, no matter how you fund it.
The federal tax credit is nonrefundable, meaning if you dont owe taxes or owe less than the 26% credit will get you you wont get that money back in a refund. You can, however, carry the credit over to a future tax year.
Some states also offer tax benefits and other incentives for solar installation. You can look up your states offerings in the Database of State Incentives for Renewables and Efficiency.
Read Also: How Many Kilowatts Of Solar Power Do I Need
How Many Kwh Can Solar Panels Produce And How Many Panels You Need On Your Roof
The amount of power your solar energy system can produce depends on the number of solar panels that can absorb solar energy and convert it into electricity.
Assuming you are going to choose standard-efficiency solar panels, here are the most common sizes for residential solar systems and their kWh production potential to give you an idea of how many panels you would need to run a house.
- A 3kW solar system which consists of 12 panels can produce an average of 4,200 kWh per year. You will need a roof space of about 194 sq ft for a 3kW system.
- A 5kW solar system which consists of 20 panels can produce an average of 7,000 kWh per year. You will need a roof space of about 340 sq ft for a 5kW system.
- A 10kW solar system which consists of 40 panels can produce an average of 14,000 kWh per year. You will need a roof space of about 680 sq ft for a 10kW system.
Keep in mind that the amount of power your solar system can produce depends on how much sunlight your roof receives and your location.
For example, California has more sunny days annually than Washington. In this case if you live in Washington you would need a bigger solar system to get the same power as you would get with a smaller system in California.
The Renewable Resource Data Center provides average daily total solar resource information on grid cells by state and its free to use so check it out.
What Are The Labour Costs
When you are given a quote for your solar panel system, labour costs are typically included. There are two common ways of calculating the labour costs for solar panel installations in the UK.
One way is to calculate approximately £300-£500 per person, per day. As it usually requires two people to install the system, a final installation fee is normally £600-£1,000. If you are installing a larger system, it may take more than one day and the costs will naturally rise.
Another way to calculate the installation fee is to charge 20 pence per watt. So, for a 4kW system, you would be paying 20 pence for 4000 watts, resulting in £800.
Don’t Miss: How Feasible Is Solar Energy
How Much Do Solar Panels Cost For A 1500 Square Foot House
For a 1500 square feet house, installation of monocrystalline panels would cost between $7,500 and $21,000.
It is hard to calculate exact cost of solar panel installation just by knowing house area. So previous energy bills must be seen to get a good estimate. As per such an estimate, one 1500 square feet house has 6kW load installed.
Survey shows that cost of solar power panels ranges between $2.5 and $3.5 per watt. In this way, we can say that 6000 * 2.5 = $15000 minimum and 6000 * 3.5 = $21000 maximum are needed to power a 1500 square feet house.
Anyhow, it must also be mentioned that a 1500 square feet house could have just 3kW load.
With this assumption, lower slab of installing solar power system becomes: 3000 * 2.5 = $7500. Resultantly, it can be said that for a 1500 square foot house, you need $7,500 to $21,000.
Solar Power For The Home: Costs
Solar power is capital intensive, and the main cost of owning a system comes upfront when buying the equipment. The solar module will almost certainly represent the largest single component of the overall expense.
Other equipment necessary for installation includes an inverter , metering equipment , and various housing components along with cables and wiring gear.
Some homeowners also consider battery storage. Historically, batteries have been prohibitively expensive and unnecessary if the utility pays for excess electricity that is fed into the grid . The installation labor cost must also be factored in.
In addition to installation costs, there are some further costs associated with operating and maintaining a PV solar array. Aside from cleaning the panels regularly, inverters and batteries generally need replacement after several years of use.
While the above costs are relatively straightforwardoften a solar installation company can quote a price for these for a homeownerdetermining subsidies available from the government and/or your local utility can prove more of a challenge. Government incentives change often, but historically, the U.S. government has allowed a tax credit of up to 30% of the system’s cost.
Recommended Reading: How Much Does It Cost For 1 Solar Panel
Understanding The Solar Investment Tax Credit
As we alluded to earlier, the ITC has been an overall boon to the expansion and health of the solar industry. As of 2021, the ITC reduces the cost of installing solar panels by 26%, and its a large reason the solar industry has consistently experienced a 42% annual growth rate for the past decade.
Unfortunately, the residential ITC is set to completely expire by 2024, with the ramp down already happening now. Thankfully, solar panel installations costs overall have decreased during the life of the ITC, but the solar panel industry is still preparing for a slowdown in installations in the short-term future. Therefore, if there was any time to consider solar panels for your home, the time is now. The discount is only going to decrease.
Assessing Your Solar Panel Potential
Even for the most eco-friendly among us, converting completely to renewable energy can be very costly. This is especially true for adopting solar power at your home or business. We applaud anyone and everyone who wants to install rooftop solar panels, but we also understand that people need to first investigate the costs and all of the associated details driving those costs.
A good place to start with an online solar installation cost calculator. While some are more detailed than others, most of them ask you a few basic questions:
- Size and type of roof
- Average monthly electric bill and usage
From there, you should reach out to reputable solar panel companies in your area for quotes. As we discussed earlier, the specific details of your home will impact the labor costs of installation, which is the source of any variance you might see in the quotes you receive.
Ultimately, if you value the eco-friendly benefits of solar energy, you should also understand the underlying costs of that value. Its important you obtain and any all information you can from these companies so you can calculate the costs as effectively as possible. A good solar panel installer will want to explain the pricing in full, including the payback period when your solar system will eventually pay for itself.
And if you want to learn more about this topic, check out our article on everything you need to know about solar panels for your home.
Recommended Reading: How Many Amps Does A 200 Watt Solar Panel Produce
Evaluate Your Sunlight Exposure
More sun means more energy produced and a greater potential to save with solar. Certain states, like Arizona and California, average more sunlight hours per day.
Your home’s orientation toward the sun, the amount of shade and its roof type also affect a solar system’s output. You can estimate the efficiency of panels in your area by using the SolarReviews calculator. Enter your address and the average cost of your monthly energy bill.
How Much Do Solar Panels Weigh
If youre planning on installing a rooftop solar system, understanding the weight of your solar panels is another key factor to consider. Knowing a solar panels weight is the best way to be certain that your roof can support a full installation.
While panel weights vary from brand to brand, most panels weigh about 40 pounds.
SunPower panels are the lightest of all major brands*, with some of our panels weighing as little as 33 pounds. For comparison, at the top end of the range some conventional panels weigh as much as 50 pounds.
Don’t Miss: Where To Buy Md Solar Sciences
Cost Of Solar Panel Mounts
Solar panel mounts cost anywhere from $10 to $3,000 each, depending on if its fixed, adjustable or a motorized tracking mount. Similar to the panel types, the least expensive option is the least efficient and the more expensive options are more effective.
- Fixed: $10-$15 each. These are completely stationary and cannot be adjusted to capture more or less sunlight depending on weather and season. They are the least expensive type of mount. Installing this mount is optimal in regions where continuous sunlight can be expected, as adjustments wouldn’t be as necessary in order to maximize on energy production.
- Adjustable: $50 each. These can be tilted depending on the intensity of the sun or the season. They are more expensive than the fixed mounts but will have more energy efficiency. Adjusting the panels to soak up more sun in varying seasons will equate to greater energy production. These adjustments can also be useful when the weather turns, as you can lay them flat to avoid damage from wind.
- Tracking: $500-$3,000+ each. Follows the arch of the sun and provides maximum efficiency. The amount of energy you will be able to generate depends not only on panel construction and mounting, but your location. Though the initial cost for tracking is higher than other mounts, these can often get you the highest return on investment, as they make the most of every ray of sunlight. Track mounting may add 45% energy production.
How Do I Find The Best Price For My System
It is always best to get at least 3 or 4 quotes from solar installers to know that you are getting the best deal. As the chart at the top of this page shows, the price people pay for solar panels varies dramatically. This is often the result of households failing to compare enough installers to find the best price.
Many people often assume that the large national installers offer the best price. However, many local state installers offer very competitive installation costs. We recommend always comparing both national and local installers.
You can complete the form at the top of this page to compare prices of trusted local and national installers to find the best price.
Don’t Miss: What Size Solar Panel Do I Need
Federal Solar Tax Credits And State Solar Incentives
When you own the home solar system, you are eligible to apply for up to 100% of the available federal and state incentives and rebates.
As this recent article in Forbes magazine explains, the federal solar Investment Tax Credit , which was scheduled to drop from 26% to 22% in 2021, will stay at 26% for two more years and not drop to 22% until 2023. For a $20,000 system, the 26% federal credit would be $5,200, compared to $4,400 under the 22% credit.
Several states also offer solar tax credits and solar tax rebates. People who own their solar system and/or battery in participating states may be able to claim these expenses on their local taxes or receive cashback on their installation. While you may be eligible for a solar tax credit or a solar tax rebate with the purchase of a home solar system, please remember that tax incentives are subject to change.
What Is The Average Cost Of Solar Panels
Solar panels will reduce your overall total costs on power in your lifetime. There are upfront costs to consider.
The good news is that the cost of panels only continues to fall year after year. As technology advances, rates drop, and solar power becomes cheaper to produce.
In order to get a solar panel system, its important to keep in mind that the cost can vary significantly based on various factors: roof type and space, sun exposure, daytime appliances used, monthly electric bill or power consumption, solar panel system size, quality, installation, labor, installation, brand, location or city, etc.
Read Also: How Do You Put A Solar Cover On A Pool
Is Solar Getting Cheaper And Should I Wait
Solar is getting cheaper as every year passes due to the large spike in Chinese production, and market hyper-consumption. This along with the Australian governments Small-scale Renewable Energy Scheme has meant that installers have struggled to keep up with the demand of the last few years, and for good reason.
Should you wait? Not really. With the cost of power steadily on the rise in Australia and the interest-free finance available specifically for solar installs, there is no reason why you should not get a solar system installed taking advantage now of this far cheaper form of energy production.
How Much Does A Solar Panel Cost
Prices have been coming down steadily over the years. The total cost will depend on how many kilowatts of power your array will generate. According to consumer reports, after solar tax credits are accounted for, the cost for a solar panel system on an average-sized house in the U.S. in 2021 ranges from $11,000 to $15,000.
You May Like: Are Solar Panels A Good Idea
Solar Panel Installation Cost Breakdown
Many components go into installing a solar panel system. This includes calculating your power needs and surveying your home to make sure your roof can handle the load. Then the site is , and the panels are mounted onto a frame on your roof. They are then connected to the inverters, which are installed on the outside of your home on the other side of your electrical panel.
Most installers quote a single price for the materials and labor for this project. However, the labor generally breaks down to between $3,000 and $5,000 for the average 6kW system, or between $0.50 and $1.20 a watt for installation costs out of the total $2.50 to $3.50 a watt costs for the total system. Your labor costs are influenced by various factors, including the roof pitch, roofing materials, inverter type, and panel type. Thin-film panels with micro inverters are faster and easier to install than monocrystalline panels with string inverters. So, labor for the first example would be lower than for the second.
The following is the percentage breakdown of the total cost:
|$18,480 – $21,120|