How
Much Does a Solar Panel Cost?
How much does a solar panel cost? It will be irresponsible to offer a mere figure for this question, as to set
up a complete
solar power system requires more than just a solar panel. While the panels are the
components that harvest the sun’s energy, it takes an entire system to create reliable clean energy your home
uses. The intention of this question is palpable: they want to know how much it costs to go solar for home.
Before we break down the cost of going solar, we hope you can understand that there are two types of solar power
systems, the grid-tied and the off-grid. The cost for the respective system will not be the same, as they
consist of different units. In addition, every element of the system and the choices you make as a consumer will
impact the total cost. Below we’ll share how equipment, installation and your energy needs affect the costs of
going solar.
Table of
content
- How Much Do Solar Panel Systems Cost?
- Costs of the Equipment of A Solar Panel System
- Installation Costs
- Maintenance Costs
- Financial Incentives
- Commonly Asked Questions
- Next Step
How Much Do Solar Panel Systems
Cost?
According to EnergySage,in 2022, the average cost of a residential solar system withinstallation in the U.S. is
$20,498, after the federal solar income tax credit. But prices can vary widely. That’s why we recommend getting
multiple bids from solar companies before you make a purchase.
Before reviewing solar proposals, it’s important to understand the three parts involving buyinga residential
solar system, which can help understand what goes into the
solar panel
cost.
- Equipment
- Installation
- Financial Incentives
Costs of the Equipment of A Solar Panel System
Solar panels account for only about one-quarter of the cost of a solar project.There are three types of solar
panels each with different construction, performance and cost.
Polycrystalline:These panels are blue in color and use multiple silicon crystals melted
together. They are a bit less efficient than monocrystalline but are a more affordable option.
Monocrystalline: Monocrystalline are made from a single silicon crystal and
typically have better efficiency and are smaller in size than polycrystalline. They also tend to be the higher
cost option.
Amorphous solar panels: They are lightweight, flexible and have portable
options, buthave much lower efficiency than Polycrystalline or Monocrystalline. They are also larger and require
twice the space than monocrystalline panels.
Click
monocrystalline vs polycrystalline to learn their differences.
System size
The number of panels you’ll need for a system is determined by how much energy your home uses. Typically,
consumers aim to offset 100 percent of their electricity usage with solar to get their energy bills as low as
possible. For example, a typical 2,000 square foot three-bedroom home will require a system with about (20)
350-watt panels with a cost of $15,000 and $40,000 including installation.
Most American homes need about 30 panels to cover 100 percent of their energy usage. Where you live may also
impact how many panels you need. In areas where there are more peak sunlight hours, you may require fewer panels
to generate the energy you need or vice versa for areas with fewer peak sunlight hours.
Inverters
Inverters are solar components that
convert the DC power your panels produce to the AC power your home uses. There are a few types of power inverters with varying equipment and
installation costs. Inverters typically account for about 5-10 percent of a project’s cost.
Grid tied vs. offgrid systems
Grid Tied Solar Systems are tied to the electric grid. That means your home
remains connected to the power grid and draws energy when solar panels or batteries are not producing. Grid tied
systems also allow your home to send excess energy produced by solar back onto the grid, which means you can
sell extra solar power for extra income to offset the solar cost. These systems need to be installed by
professional installers, which means you have to pay the installation fees.
Off-Grid Solar Systems are, in most cases, only an option where there is no access to
electricity from the grid. These systems are fully self-reliant and require batteries to provide power at night
or when the sun isn’t out. Off-grid systems can be installed DIY, but you have to buy a solar battery.
Installation Costs
Installation fees includes the cost of:
- Labor
- Additional equipment like mounting brackets and cabling
- Fees for permitting and inspection
If using a professional installer, installation represents a sizable portion of the cost of a solar project.
The material your roof is made of will also impact installation costs. Materials such as asphalt shingle tend to
have lower installation costs, while materials like clay tile have higher installation costs. A flat roof
surface requires supplementary brackets.
Grid connected systems will need to be permitted and inspected by either the local housing jurisdiction, the
utility, or both. That’s why grid-tied systems are typically installed by professionals.
Permitting and inspection require fees that are bundled into installers’ estimates in most cases. There will
also be an ongoing interconnection fee from the utilities to remain connected to the grid.
Maintenance Costs
Solar panel
maintenance is typically not a significant expense. Modern panels are nearly self- cleaning with natural
rainfall usually sufficient to keep them clean. At times you may need to clear your panels of tree debris or
dust. You may want to hire a professional to do this.
As for repairs and replacements,residential solar systems don’t have moving parts so equipment failures are
relatively uncommon. However most solar equipment comes with 20-30 warranties that cover equipment failures and
defects.
Financial Incentives
Incentive and rebates
Through 2022, the
federal solar tax
credit is 26 percent of system costs. In 2023 the credit goes down to 22 percent. Various other
financial incentives are available to make solar more affordable forresidential customers. Incentives vary
depending on where you live and are available through government agencies, utilities or both. To learn more
about incentives, visit dsireusa.org.
During our research, we find that some professional incentive terms can lead to misunderstanding easily. In this
regard, we make the chart below to offer you a clear overview and you can compare which policy can offer you
real benefits in reducing your solar cost.
| Full Name | How Does It Save Your Solar Panel Costs? | Energy Type | Who Can Apply? | States With The Policy | |
|---|---|---|---|---|---|
| SREC | Solar Renewable Energy Credits | Allow you to earn additional income from solar electricity generation | Solar electricity | Homeowners | States with solar carve-outs, and less than 10 states have adopted SREC |
| REC | Renewable Energy Certificate | Allow you to earn additional income from green electricity generation | Any renewable energies | Homeowners | States with solar carve-outs, and about 30 states have adopted REC |
| ITC | Solar Investment Tax Credit, or Federal Solar Tax Credit |
Can be claimed on federal income taxes for a percentage of the cost of a solar photovoltaic (PV) system. | Any renewable energies | Homeowners and Business | All states |
| Utility Rebate | Utility Rebates And Incentive Programs | A dollar-for-dollar reduction in the cost to install a solar energy system. | Any renewable energies | Homeowners and Business | More than 32 states |
*Information source: energysage, National Renewable Energy Laboratory, Department of Energy, and Database of
State Incentives for Renewables & Efficiency.
If you are interested in learning more details about solar tax credit, click
Everything You Need To
Know About Solar Tax Credit
.
Commonly Asked Questions
How many solar panels do I need?
You have to know how much residential electricity to keep your house appliances running before deciding how many
solar panels are needed. Here is a simple method: check out your electricity bill. From the bill history, you
can easily find out your daily electricity consumption. Then plug the figure, as well as your appliances working
hours, charge controller efficiency and average sun hours per day, into the Renogy
Solar Calculator, you can get the answers in a
flash!
Find more information on
You Will Need How Many Solar Panels to Power a House?
How long to recoup costs?
It’s easy to calculate return on investment or ROI for solar. Just divide the total cost of your system (after
incentives)by your average energy savings per month. ROI or “payback” time is measured in months and years. It
tells you how long it will take to recoup your solar investment.
| System cost | $15,000 |
|---|---|
| Fed Tax Incentive (26%) | $3900 |
| Net system cost | $11,000 |
| Monthly Energy Savings | $150 |
| Payback Period | 6 years 1 Months |
Even though solar may come with a substantial upfront investment, those costs can often be recouped in as few as
5 to 15 years. In that time, not only are you saving on energy, but you’re reducing your carbon footprint. That
should be enough to get anyone excited about joining the clean energy community.
Next Step
Solar power, as one of the most affordable, accessible and reliable electricity for households, offers the best
electricity alternative for faraway areas that cannot connect to the grid, as well as families that are longing
to reduce their electricity bills. Installing an off grid solar power system or grid tied system will be the
best practice to go solar.
If you’ve been ready to join the clean energy community,
Renogy will be your first stop to start the solar journey.
Renogy is an aspirant in solar panel industry, dedicated to push forward the sustainable living and energy
independence.We are confident that our DIY friendly and reliable renewable energy products will enable the
energy independence of 50 million people by 2030. We have the off grid solar kit, portable solar
panels for home, MPPT solar charge controllers, and solar batteries for sale!
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- What You Need To Know About Solar Panels
- How Much Does Rv Solar Cost?
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Analysis - Does
Solar Increase Home Value?
