How much will a solar panel system cost for your home?

Oct 18 2021
How much will a solar panel system cost for your home?

Did you know in the U.S, a homeowner installs a solar panel every 100 seconds? Impressive, right?

Today, PV modules have become popular because not only are they cheaper than ever, they've become far more advanced. They come with features that maximize power generation, making them one of the most reliable sources of energy in homes.

However, one question that everyone seems to ask before installation is, "how much does a solar system cost?"

In this article, we'll answer that question by exploring solar power system costs by size, state, and manufacturer. This should help you to make your most educated decision when to comes to powering your home or business.

Are solar panels worth the investment?

When setting up a solar system, it's important to have clear objectives of what you want to achieve. For instance, you may be planning to:

  • Cut down on your energy expenses;
  • Use it as a backup in case of power outage;
  • Make a profit from the system by selling surplus power to the state or other businesses.

With clear objectives, it's easy to know which sizes to buy and at what cost. You don't need to buy a system that will undersupply power to your house, and neither do you need to produce too much power that you don't need. If you play your cards well, installing photovoltaic panels is always worth the investment for one reason or another.

Factors influencing the cost of installing solar panels

A single solar panel costs anywhere between $2.67 and $3.43 per watt installed, including the set-up expenses. The cost for an off-grid solar system depends on the factors below:

1. Type of setting up

Rooftop solar system  installations are the most common in the U.S, and they’re cheaper than some other options. Floor-mounted panels and automobile setups are another option, but may require additional posts that must be ground-rooted, which often increases the overall price

2. Roof type

Another factor that determines the cost of installing a solar panel is the roof type. There are three main types of roof - metal, flat, and shingled - and each requires different components and installation techniques. 

For instance, metal roofs demand special fitting to join the panel shelves to the rooftop; On grooved or permanent roofs, the shelves are connected directly to the metal.

3. Energy consumption

PV modules come with different capacities of power output. This means, if more power is required, more modules and devices need to be installed, which may raise the overall  cost per kWh.

If you live in an area of constant blackouts, you’d need to factor in a solar battery storage system cost. Solar batteries are an optional add-in that will allow you to store some of the energy you produce for when the grid goes down. Really, it’s just a big rechargeable battery for your house. In this case, the cost of batteries themselves spikes the overall average solar system cost.

4. Connection costs

The quality of solar energy use in a neighborhood and connection costs rely on some factors, which include the age and strength of the devices in your system, and the size of the sun power solar system itself. 

Every utility firm must follow specific requirements, which might affect your overall setup costs.

The average cost of the residential solar system 

For residential buildings, you can expect a 10kW solar system cost to go over $20,424, after the federal tax credit. A 5kW solar system cost may fall between $3,650 and $5,440. 

The PV module expenses range from $2.50 to $3.50 per watt, depending on your region. Also, depending on the service provider, a 6 kW solar system cost may be around $2.70 per watt in the U.S ($16,500 for a 6-kilowatt system). However, after the tax credit deduction, the total price may be approximately $12,200.

Generally, if you want to mount a 3-8 kilowatt residential solar system, the entire amount for setup ranges from $9,200 to $28,000, on the other hand, if you require a larger setup, expect a 20kW solar system cost to reach  $55,200.

Installation of a solar panel costs in size

Setting up a huge system with more solar panels is costlier than having a smaller system with fewer panels (and less energy production). Whether it is a 1.5kw solar panel or 16-25 kW solar system, there is a Costco-like link between pricing and panel size.

For example, a 4kW solar system costs generally about $2.88 per watt in the U.S and prior to tax credits is about $11,500. For a bigger size, e.g. 20 kilowatts, you can expect around 55 thousand. Below is a table showing cost estimates by size.

Cost of solar panels by system size

SYSTEM SIZE 

$/W

 AVERAGE SOLAR PANEL SYSTEM COST (BEFORE TAX CREDITS) 

 AVERAGE SOLAR PANEL SYSTEM COST (AFTER TAX CREDITS)

2 kW

$3.41

$6,822

$5,048

3 kW

$3.05

$9,159

$6,778

4 kW

$2.88

$11,524

$8,528

5 kW

$2.82

$14,111

$10,442

6 kW

$2.81

$16,857

$12,474

7kW

$2.78

$19,436

$14,382

8kW

$2.75

$21,968

$16,256

9 kW

$2.75

$24,706

$18,283

10 kW

$2.75

$27,541

$20,381

11 kW

$2.70

$29,657

$21,946

15kW

$2.68

$32,135

$23,780 

NOTE: The table represents the median price for this panel size; H. $3.41 represents the median pricing for panels ranging from 2 to 2.99 kW.

Discounts and other tax credits from several states, local governments, and services, can minimize the cost of solar systems in your solar installation options.

In fact, while larger systems are more upfront, they help you save more money over time.

Solar panel installation costs by state

While determining the average cost of a home solar system, it is worthy of note that solar system installation costs are different for each state.

The median amount of power utilized per home is higher in states where residents rely more on air conditioning. As a result, solar hotspots like Florida and Arizona are home to some of the world's largest solar panel systems.

So, there is lower $/W pricing in cold regions and a higher $/W pricing in hot areas. However, the entire cost is normally comparable to that of necessity - hot environments have a cheaper cost per watt but bigger system sizes, whereas cold regions have a more expensive price per watt but smaller system sizes. 

Cost of solar panel system by state

STATE

 COST PER WATT ($/W) 

 SOLAR PANEL COST RANGE (6 KW SYSTEM) 

 SOLAR PANEL COST RANGE (10 KW SYSTEM) 

Arkansas

$2.49

$12,960 – $16,920

$21,600 – $28,200

Arizona

$2.33

$12,600 – $15,360

$21,000 – $25,600

California

$2.66

$14,340 – $17,580

$23,900 – $29,300

Colorado

$3.12

$17,340 – $20,100

$28,900 – $33,500

Connecticut

$3.11

$16,080 – $21,240

$26,800 – $35,400

Washington, D.C.

$3.43

$15,900 – $25,260

$26,500 – $42,100

Delaware

$2.61

$14,580 – $16,740

$24,300 – $27,900

Florida

$2.46

$12,960 – $16,560

$21,600 – $27,600

Georgia

$3.01

$16,380 – $19,740

$27,300 – $32,900

Iowa

$2.70

$15,060 – $17,340

$25,100 – $28,900

Idaho

$2.66

$13,920 – $18,000

$23,200 – $30,000

Illinois

$2.88

$15,120 – $19,440

$25,200 – $32,400

Indiana

$2.98

$15,780 – $19,980

$26,300 – $33,300

Louisiana

$3.10

$16,860 – $20,340

$28,100 – $33,900

Massachusetts

$3.04

$16,200 – $20,280

$27,000 – $33,800

Maryland

$2.99

$15,660 – $20,220

$26,100 – $33,700

Maine

$2.61

$14,880 – $16,440

$24,800 – $27,400

Michigan

$3.01

$15,480 – $20,640

$25,800 – $34,400

Minnesota

$3.04

$16,320 – $20,160

$27,200 – $33,600

Montana

$2.77

$14,700 – $18,540

$24,500 – $30,900

North Carolina

$2.80

$14,580 – $19,020

$24,300 – $31,700

New Hampshire

$3.07

$16,560 – $20,280

$27,600 – $33,800

New Jersey

$2.67

$13,800 – $18,240

$23,000 – $30,400

New Mexico

$3.15

$16,200 – $21,600

$27,000 – $36,000

Nevada

$2.34

$12,780 – $15,300

$21,300 – $25,500

New York

$3.14

$16,260 – $21,420

$27,100 – $35,700

Ohio

$2.67

$14,700 – $17,340

$24,500 – $28,900

Oregon

$2.81

$15,240 – $18,480

$25,400 – $30,800

Pennsylvania

$2.90

$15,600 – $19,200

$26,000 – $32,000

Rhode Island

$3.14

$16,500 – $21,180

$27,500 – $35,300

South Carolina

$2.93

$16,080 – $19,080

$26,800 – $31,800

Texas

$2.70

$13,920 – $18,480

$23,200 – $30,800

Utah

$2.71

$14,580 – $17,940

$24,300 – $29,900

Virginia

$2.92

$15,720 – $19,320

$26,200 – $32,200

Vermont

$2.91

$15,420 – $19,500

$25,700 – $32,500

Washington

$2.58

$14,160 – $16,800

$23,600 – $28,000

NOTE: These price brackets are price tags BEFORE the 26 percent federal tax credit for solar.

Installation costs of solar systems according to manufacturer

Below is a table formed from the EnergySage Marketplace data which shows the average 6kW solar system cost and 10kW solar panel systems cost used in the installation project.

Cost of solar panels by panel manufacturer

Search:

MANUFACTURER

COST PER WATT

PRICE RANGE (6KW SYSTEM)

PRICE RANGE (10KW SYSTEM)

Axitec

$2.53

$13,680 – $16,680

$22,800 – $27,800

Aptos

$2.46

$12,960 – $16,560

$21,600 – $27,600

Canadian Solar

$2.96

$16,380 – $19,140

$27,300 – $31,900

CertainTeed Solar

$2.74

$15,540 – $17,340

$25,900 – $28,900

First Solar

$2.53

$14,940 – $15,420

$24,900 – $25,700

Hanwha SolarOne

$2.80

$16,800 – $16,800

$28,000 – $28,000

Heliene

$2.89

$15,540 – $19,140

$25,900 – $31,900

Hyundai

$3.03

$15,180 – $21,180

$25,300 – $35,300

JA Solar

$2.66

$13,920 – $18,000

$23,200 – $30,000

Jinko Solar

$2.79

$14,280 – $19,200

$23,800 – $32,000

LG Solar

$2.75

$14,220 – $18,780

$23,700 – $31,300

LONGi Solar

$2.81

$14,460 – $19,260

$24,100 – $32,100

Mission Solar

$2.62

$13,980 – $17,460

$23,300 – $29,100

Next Energy Alliance

$2.44

$13,800 – $15,480

$23,000 – $25,800

Panasonic

$2.71

$14,400 – $18,120

$24,000 – $30,200

Peimar Group

$2.65

$14,160 – $17,640

$23,600 – $29,400

Phono Solar Technology

$2.89

$15,780 – $18,900

$26,300 – $31,500

Q CELLS

$2.70

$13,920 – $18,480

$23,200 – $30,800

REC

$2.76

$14,160 – $18,960

$23,600 – $31,600

Risen

$2.30

$13,800 – $13,800

$23,000 – $23,000

S-Energy

$2.57

$13,740 – $17,100

$22,900 – $28,500

Seraphim

$2.65

$15,900 – $15,900

$26,500 – $26,500

Silfab Solar

$2.81

$14,880 – $18,840

$24,800 – $31,400

Solaria

$2.86

$14,640 – $19,680

$24,400 – $32,800

SunPower

$3.35

$18,840 – $21,360

$31,400 – $35,600

Suntech

$2.53

$12,840 – $17,520

$21,400 – $29,200

Tesla

$2.72

$14,700 – $17,940

$24,500 – $29,900

Trina Solar

$2.82

$14,880 – $18,960

$24,800 – $31,600

VSUN

$2.11

$11,940 – $13,380

$19,900 – $22,300

ZNShine Solar

$2.99

$15,540 – $20,340

$25,900 – $33,900

NOTE: These ranges are panel costs BEFORE the 26 percent federal tax credit for sunpower.

The home solar power system costs define the quality of the panels to a great extent. When weighing solar panel prices based on brands, it's crucial to note that a plethora of other aspects exist; including installation experience, location, racking equipment, inverter type, and more.

What is the cost of a solar panel installation for an average 2,000 square foot house today?

A residential solar panel installation, on average, costs between $18,000 and $20,000, before implementing tax credits or other incentives available in your location. This ranges between $2.75 and $3.35 per watt of solar installed, depending on your location and the brands of solar equipment used. 

Once you claim the federal solar tax credit, the total setup cost decreases to almost 80% lower than the cost of a solar system for a house ten years ago. You can use a solar panel cost calculator online to estimate the setup costs and solar panel life expectancy.

What is solar tax credit and how can the solar installation be cheaper with it?

The federal residential solar tax credit is a tax credit that can be taken from federal income taxes for a portion of the cost of a solar photovoltaic (PV) system. 

Generally, the cost of PV solar system setups provided by your utility is excluded from income taxes by federal law. If this is the case, the utility rebate for installing solar is deducted from your costs before you evaluate your overall credit.

You must satisfy these qualifications to declare tax credit:

  • Have set up your PV solar system between January 1, 2006, and December 31, 2023.
  • Have the PV solar system be set at your home in the United States, or for a remote community solar project, if the energy produced is charged against, and does not exceed your home’s electricity usage. 
  • Own the PV solar panel. 
  • The PV solar panel is new or being handled for the first time. The credit can only be claimed on the “original installation” of the solar equipment.

How can you find the right solar installation company?

Finding the right solar installation company is like hiring a contractor: do your background research on the solar marketplace, understand the way they work, and read the contract meticulously. 

The solar installation process also entails handling your utility, obtaining permits from one or more district officials, and paperwork. A great firm handles all of that, relieving the client of any of those worries.

Also, while investigating solar installation firms, be careful of new unestablished companies giving you prolonged warranties. They may promise a ten or twenty-five-year guarantee to secure a deal. But one can’t be sure that those systems will stand the test of time, certainly not when the company hasn’t themselves.

At Innovate solar, our amazing team of energy solutions specialists can help you figure out if solar panels are the right option for you and your home. We also help vendors starting a solar installation business. We provide assistance with information on the types of hardware they need, costs, etc.

Final word

While there are some upfront costs involved in going solar, using solar panels to run a house is more popular due to improved energy efficiency, faster payback periods, and tremendous savings. 

Harnessing solar energy in your region is seamless with the best solar solution from Innovate Solar

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