More and more people are choosing solar energy for their homes and businesses. Residential solar installations reached 1.1 GW in the third quarter of 2024, a clear sign of the growing interest in clean energy.
But you’re probably wondering, how much do solar panels cost in 2024? On average, a residential solar system is priced around $29,926 before federal tax credits. That might sound like a big number, but knowing the costs upfront can help you make the right choice for your budget and for the environment.
Here’s the best part. There are ways to save. Federal tax credits can lower your installation costs by as much as 30%, making solar more affordable than you might think. Curious about how to get started? Let’s break down what impacts pricing and how you can reduce your overall costs.
Key Takeaways
- Solar panel costs average $29,926 for residential systems before incentives
- Federal tax credits can reduce installation costs by up to 30%
- System size, location, and panel type impact the overall cost of solar panels
What is the Average Cost of Solar Panels?
In 2024, the average cost of a solar panel system is about $31,558 before tax credits or incentives. Actual prices typically range from $17,350 to $38,000, depending on factors like system size and location.
Here’s a quick breakdown by system size:
- 3 kW system: $11,010
- 5 kW system: $18,350
- 10 kW system: $36,700
For an 8.6 kW system, you’ll pay around $3.67 per watt on average.
To get a clearer idea of your costs, request quotes from local solar installers who can tailor estimates to your home’s needs.
What Impacts the Cost of Your Solar Panel System?
When it comes to the cost of your solar panel system, several factors come into play. From the type of panels you choose to local regulations in your area, each element can affect the total price. Let’s break it down.
Type of Solar Panel
The type of solar panel you choose can make a big difference in cost and performance. There are three main options:
- Monocrystalline panels: The most efficient and compact, but also the most expensive. Ideal if you’re working with limited roof space.
- Polycrystalline panels: A more affordable option with slightly lower efficiency. Great for homeowners looking for a balance between cost and performance.
- Thin-film panels: The cheapest option, but they need more space. Best for large roofs or commercial installations.
Your decision should factor in your budget, energy needs, and available space. Take your time to find what works best for your situation.
Quality and Brand of Panels
The quality and brand of your panels play a significant role in the overall cost. High-quality panels from trusted brands usually cost more upfront, but they offer better efficiency, longer warranties, and higher power output over time.
Cheaper panels might save you money at first but could lead to higher long-term costs if they don’t last as long or perform as well. Finding the right balance between upfront costs and long-term value is essential.
Installation Complexity
The complexity of your installation can significantly impact labor costs. Roof type, angle, and condition are key factors. A simple installation on an asphalt shingle roof will typically cost less than one on a tile or metal roof, especially if additional repairs or reinforcements are needed.
If your roof isn’t suitable for panels, a ground-mounted system could be an option, but it often comes with higher costs due to extra materials and labor.
System Size
The size of your solar panel system directly affects the price. Larger systems produce more power and often have a lower cost per watt, but their total cost is higher.
To find the right size, review your energy usage and consider your budget. A solar professional can help you determine the optimal system size for your needs.
READ MORE: How to Size a Solar System?
Local Labor Rates
Labor costs vary based on your location. Urban areas tend to have higher labor rates than rural ones, and the level of competition among local installers can also influence pricing. Regions with more solar companies may offer competitive rates, while areas with fewer options might have higher costs.
Permitting and Inspection Fees
Local regulations often come with extra fees for:
- Permits: These can range from a few hundred dollars to over a thousand.
- Inspections: Ensuring your system meets building and electrical codes.
- Utility connections: Some utilities charge fees to connect your system to the grid
Remember to factor these additional costs into your budget when planning your solar installation. They're often overlooked but can significantly impact the total price.
Average Solar Panel Costs by State
The cost of solar panels can vary a lot depending on where you live. Your location plays a big part in determining how much you’ll pay for a system, both before and after incentives.
Here’s a quick look at the average solar costs in some key states:
State | Avg Cost Per Watt | Avg Cost Before Incentives | Avg Cost After Incentives | Avg Tax Credit Value | Avg 25-Year Savings |
|---|---|---|---|---|---|
California | $2.95 | $17,700 | $12,390 | $5,310 | $88,000 |
$2.94 | $19,711 | $14,211 | $5,500 | $31,442 | |
Connecticut | $2.87 | $22,188 | $16,188 | $1,000 | $36,000 |
$2.39 | $21,635 | $15,635 | $1,000 | $30,000 | |
$2.72 | $16,320 | $11,424 | $4,896 | $65,000 | |
Hawaii | $3.38 | $19,726 | $13,726 | $5,000 | $68,000 |
Nevada | $2.52 | $15,120 | $10,584 | $4,536 | $68,000 |
Idaho | $2.47 | $21,652 | $15,652 | $4,200 | $64,000 |
Illinois | $3.04 | $24,771 | $18,771 | $1,500 | $40,000 |
$3.18 | $23,151 | $17,151 | Up to $1,000 | $60,000 | |
$2.72 | $24,625 | $18,625 | Up to 15% | $45,000 | |
$2.80 | $16,500 | $11,500 | $4,500 | $70,000 | |
$3.00 | $20,000 | $14,000 | $1,500 | $55,000 | |
$2.75 | $18,200 | $13,200 | $5,400 | $75,000 | |
West Virginia | $3.10 | $20,500 | $15,500 | $4,800 | $50,000 |
Ohio | $2.60Â | $19,800 | $14,800 | $4,200 | $60,000 |
Pennsylvania | $2.85 | $21,300 | $15,300 | $4,600 | $62,000 |
Puerto Rico | $3.15 | $22,400 | $16,400 | N/AÂ | N/AÂ |
$2.70 | $16,900 | $11,900 | N/AÂ | N/AÂ | |
$2.69 | $16,140 | $11,298 | $4,842 | $70,000 |
Date Source: Energysage
In sunnier states, you’ll often find lower costs per watt because your panels generate more energy throughout the year.
Some states also offer unique incentives to help you save even more. For example, in New Jersey, you can earn solar renewable energy certificates, which can significantly cut costs over time. Massachusetts offers a renewable energy income tax credit that can reduce your state taxes by up to $1,000. To explore incentives available in your area, visit the DSIRE USA website.
Keep in mind, your actual costs might differ. Things like your roof type, system size, and local installation rates all influence pricing.
For the best deal, get multiple quotes from reputable solar installers. Comparing options tailored to your home ensures you make the smartest choice for your budget and energy needs.
Average Solar Panel Cost by System Size
The cost of your solar panel system depends a lot on its size, which is determined by your energy usage and the space available on your roof. Let’s break it down to make it easier for you.
If you have a smaller home or use less electricity, a 3 kW system might be all you need. On average, this costs about $9,300 before tax credits.
For medium-sized homes, a 5 kW system is a popular choice. This setup usually runs around $14,850 before tax credits.
If your energy needs are higher or you live in a larger home, you might need a 10 kW system, which can cost $30,000 or more before incentives.
To figure out the system size that’s right for you, take a look at your yearly energy use. Check your electric bills and add up the kilowatt-hours (kWh) you’ve used over the past 12 months. Divide that number by 1,200 for a rough estimate of the kilowatts (kW) your system needs. This calculation assumes average sun exposure.
You’ll often hear solar companies talk about cost per watt. This is the total system cost divided by its wattage and helps you compare quotes from different installers. For example, if a 5 kW (5,000-watt) system costs $15,000, the cost per watt is $3.00. Right now, costs typically range from $3.00 to $4.50 per watt installed.
Keep in mind, these are just averages. Your actual costs will depend on factors like where you live, the condition of your roof, and the type of equipment you choose.
Average Solar Panel Cost by Type
When choosing solar panels, you’ll find a variety of options, each with its own price range and benefits. Let’s break down the costs and features of the most common types of panels to help you decide what’s right for your home.
Monocrystalline panels are the most expensive, but they’re also the most efficient. If you’re looking for top performance and need to maximize energy in a smaller space, these are a great choice. The cost usually falls between $1 and $1.50 per watt.
Polycrystalline panels are a more budget-friendly option. They’re slightly less efficient than monocrystalline panels but still get the job done for many homeowners. These typically cost around $0.75 per watt and have a noticeable blue hue.
Thin-film panels are the least expensive option. While they’re not as efficient as crystalline panels, they work well for certain setups where space isn’t a concern. These are often chosen for specific projects where affordability matters most.
Hybrid panels combine solar cells with battery storage, making them a unique option for those looking to store energy. While the upfront cost is higher, they can lead to long-term savings. Prices vary depending on the brand and capacity.
Keep in mind, these are just estimates. Your actual costs will depend on your location, the size of your system, and the specific installation details. Taking the time to compare your options ensures you get the best fit for your needs and budget.
Breakdown of Solar Panel Installation Cost
When you decide to go solar, it’s helpful to know what expenses to expect. Here’s a clear breakdown of the main costs involved in installing a solar system.
Solar Equipment Costs
The bulk of your budget will go toward the equipment. For solar panels, you’ll typically spend $0.70 to $1.50 per watt. For a 6kW system, this translates to $4,200 to $9,000 just for the panels.
Inverters, which convert the energy from your panels into usable electricity, are another key expense. A string inverter costs around $1,000 to $1,500, while microinverters, one per panel, run about $150 to $215 each. For six panels, that’s $900 to $1,290.
If you’re adding batteries for energy storage, be prepared to spend $7,000 to $14,000 for a home battery system.
Labor and Installation Fees
Labor costs are a significant part of your investment. Hiring trained professionals ensures your system is installed correctly and safely. Installation fees usually range from $0.59 to $1.50 per watt. For a 6kW system, labor costs can fall between $3,540 and $9,000.
The complexity of your roof affects these fees. A steep or multi-angled roof requires more time and effort, which increases labor costs. Your location also matters. Urban areas or regions with a higher cost of living tend to have higher labor rates.
Soft Costs
Soft costs cover things like permits, inspections, and system design. While they might seem minor, they add up quickly.
- Permits usually cost $200 to $500.
- Inspections to ensure your system meets safety standards typically cost $200 to $400.
- Design fees for planning your solar system range from $500 to $1,000, depending on its complexity.
Remember, these costs can vary based on your location and specific project needs.
How to Calculate the Cost of Solar Panels?
To estimate the cost of solar panels for your home, start by checking your monthly energy use from your bills and how much sunlight your roof gets. Both factors determine how many panels you’ll need. A solar professional or online calculator can help refine your estimate.
Use this formula:
Cost = (Energy use ÷ Sun hours) × Price per watt - Incentives
In 2024, the average cost per watt is around $3.40. Subtract any local rebates or tax credits to calculate your net cost.
Installation fees and financing options, like loans or leases, also affect the total. High-efficiency panels may cost more initially but can save you money over time.
By following these steps, you'll get a good idea of what solar might cost for your home.
How Can I Lower the Cost of Solar Panels?
You can save on solar by taking advantage of the 30% federal tax credit and looking into state and local incentives. Net metering can also help reduce costs by allowing you to sell excess energy back to the grid.
Consider financing options like solar loans or leases to make payments more manageable. While DIY installation might seem cost-effective, professional installation ensures safety and protects warranties.
Shop around by getting quotes from multiple installers and comparing offers. Look for seasonal discounts that may lower your upfront expenses. Choosing a smaller system might also save you money, and an energy audit can help you find the right size for your needs.
Comparing Residential vs. Commercial Solar Panel Costs
Residential solar panels typically cost $2.50 to $3.50 per watt, while commercial systems range from $2 to $4 per watt, with larger projects benefiting from lower costs per watt. Home systems are usually 5 to 10 kilowatts, while businesses often require much larger setups.
Residential installations face challenges like roof condition and shading, while commercial projects deal with structural requirements for large systems. Businesses also benefit from incentives like accelerated depreciation, making their return on investment faster.
For additional savings, explore the Biden-Harris administration’s solar initiatives, including a new grant competition offering up to $7 billion to expand low-income solar programs.
Is Installing Solar Panels Worth It?
Solar panels can be a great investment, with most systems paying for themselves in about 7.5 years. Over 25 years, you could save between $28,000 and $120,000 on electricity costs.
They can also increase your property value, as many buyers see solar as a desirable feature. Plus, switching to solar reduces your carbon footprint and supports clean energy.
While the upfront cost ranges from $8,500 to $30,500, the long-term savings and benefits often outweigh the expense. Your exact savings depend on your energy use, local electricity rates, sunlight, and panel efficiency.
To see how much you could save, contact Sunsoaked Solar for a personalized quote today.
Frequently Asked Questions
How much does one solar panel cost?
Solar panel prices vary based on type and efficiency. You'll find premium monocrystalline panels priced between $1 and $1.50 per watt. Polycrystalline panels are more budget-friendly, costing around $0.75 per watt.
For example, a 400-watt solar panel could set you back $300 to $600. The final price depends on the panel type and where you buy it.
How much is a solar system for a 2000 sq ft house?
A 2,000 sq ft home typically needs a 6 kW to 11 kW solar system. Your energy use and local sunlight affect the size you'll need.
You can expect to pay between $18,000 and $38,000 for such a system. This price is before tax credits and incentives, which can lower your costs.
How many solar panels do I need?
Your panel count depends on your energy needs and panel wattage. Let's say you use 8,000 kWh yearly and choose 300-watt panels. You'd need about 25 to 30 panels.
Your roof space and sun exposure also play a role. These factors can change how many panels you'll need to power your home.
How long does it take for solar panels to pay for themselves?
Most solar systems pay for themselves in 5 to 10 years. Your payback time depends on installation costs, local power rates, and available incentives.
After this period, you'll enjoy free electricity for many years. Solar panels often last over 25 years, giving you decades of savings.
Do solar panels increase property value?
Yes, solar panels can boost your home's value. Studies show homes with solar often sell for more than those without.
On average, solar homes sell for about 6.8% more. This added value can often cover a big part of your initial solar investment.
Are solar panels really worth it?
Solar panels can lead to big savings on your power bills over time. Many homeowners see their utility costs drop significantly after going solar.
You'll also shrink your carbon footprint by using clean energy. This helps create a more sustainable future for everyone.
solar reduces your carbon footprint