Understanding solar panel costs is a key step in deciding whether solar is the right investment for your home or business. Based on our survey of 1,000 solar customers, the national average price for a single solar panel professionally installed is $1,200. This means most full-size systems of between 20 and 30 panels cost between $24,000 and $36,000.
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In this guide, we break down everything you need to know, from the average cost of solar panels and installation to the factors that affect pricing and potential savings over time. Whether you’re just starting your research or ready to compare quotes from the best solar companies, this guide will help you make an informed, confident decision about going solar.
Blue Raven Solar tops our list of the best solar companies thanks to its top-performing solar panels and competitive pricing. Learn more about our top picks for solar installation in the table below.
Company Star Rating BBB Rating Warranties Blue Raven SolarRead Our ReviewA+25-year panels, 10-year workmanship Venture SolarRead Our ReviewA+25 years Solar Energy WorldRead Our ReviewA+25–30 years A+25-year panels, 10-year workmanshipOn average, residential solar installations range from $24,000–$36,000 after applying federal tax credits. A 15,900 kilowatt-hour (kWh) system of 18–34 panels for a standard three-bedroom home costs an average of $24,222, according to our survey.
However, solar costs can vary widely depending on where you live. For instance, states like California and New York often have higher prices due to labor rates and stricter building codes, while states such as Texas and Florida tend to offer more affordable installation options. Understanding these regional differences can help you better estimate your potential investment.
The cost of going solar can vary widely from home to home because several key factors come into play. Understanding what affects solar panel installation costs will help you get the most accurate estimate for your property and potentially save you thousands in the process.
Here’s a detailed cost breakdown for a standard residential solar installation according to a report from Solar Energy Industries Association (SEIA), the U.S. Department of Energy, and our survey data:
The type of solar panel you choose significantly impacts both cost and performance. There are three main types used in residential systems:
For example, a 6 kilowatt (kW) monocrystalline system may cost around $1,000–$2,000 more than a polycrystalline system but could generate more power in a smaller footprint.
Get an idea of what solar panel might work best for your home using the table below.
Larger homes usually require more power, which means larger systems and higher costs. Roof space, shape, and orientation also matter.
Your current electricity consumption plays a big role in determining your system size. The more energy you use, the larger and more expensive your solar setup will need to be.
Review your utility bills from the past 12 months to determine your average kWh usage.
While solar panels are the star of the show, the supporting equipment, like inverters, racking systems, and monitoring technology, plays a major role in your system’s performance, longevity, and overall cost. Choosing the right components can increase energy output, reduce maintenance needs, and improve your long-term savings.
Inverters convert solar energy into usable electricity. You’ll typically choose from these types:
Other important solar system components include the following:
Note: The pricing information in this section was based on cost data from EnergySage and Angi.
Every roof is unique, and that can have a big impact on the overall cost of your solar panel installation. More complex roof types often require additional labor, specialized hardware, or structural adjustments, all of which can drive up costs. For example, tile or metal roofs may need extra mounting equipment to install the panels safely and securely.
The pitch and layout of your roof also play a role. Steep slopes or multi-level designs can make installations more time-consuming and labor-intensive. In some cases, especially with older homes, structural reinforcements or electrical upgrades may be necessary to ensure the roof can support the system safely.
Your location plays a big role in determining how much you’ll pay when going solar. In general, urban areas tend to have higher labor and permitting costs due to stricter building codes, higher wages, and more complex utility interconnection processes. In contrast, rural areas may offer lower installation costs, but they can sometimes lack access to experienced installers or streamlined permitting, which could delay the process.
In addition to cost differences, where you live also affects the availability and value of solar incentives. States like California, New York, and Massachusetts offer strong incentives but also come with higher overall installation costs. Meanwhile, Texas, Florida, and Arizona tend to have lower costs and growing solar markets, though incentives may vary.
Homeowners should also look into local programs such as state tax credits, utility rebates, net metering policies, and Solar Renewable Energy Certificates (SRECs), which can significantly boost savings. To learn what’s available in your area, check out the DSIRE database, a free, comprehensive resource for solar incentives by state.
A single solar battery typically costs, on average, $5,097, depending on capacity, type, and brand.* For whole-house backup systems with more than 25 kWh capacity, costs can exceed $25,000, not including installation.
The price varies significantly based on storage capacity and brand. Popular options, like the Tesla Powerwall, cost around $11,500 with installation, while premium systems like the Enphase IQ Battery can cost upward of $11,000 before installation costs.
While batteries add substantially to your initial investment, they can provide valuable backup power during outages and help maximize your solar system’s efficiency by storing excess energy for use during peak rate periods or nighttime hours.
*Based on our survey of 1,000 home solar customers, which included 279 solar battery customers.
In addition to the major cost drivers of a solar installation, several smaller expenses can still affect your overall budget. These may not be deal-breakers, but it’s important to account for them early in the planning process.
Solar panel costs can vary dramatically by state due to several key factors: local labor and permitting costs, state-specific incentives and regulations, and varying levels of market competition among installers. These differences lead to price swings, with northeastern states like Massachusetts and New York typically seeing higher installation costs and southern states like Texas and Florida seeing lower rates.
Solar panels are a long-term investment, and the good news is you don’t have to pay for everything upfront. There are several flexible financing options available to help homeowners make the switch to solar without breaking the bank. Choosing the right solar financing method can significantly impact your overall savings and return on investment.
One of the most common questions homeowners have is: When will my solar panels pay for themselves? While the exact timeline varies based on factors like system cost, energy usage, local utility rates, and available incentives, most homeowners see a payback period of 6–10 years. Over a 25-year system lifespan, that can translate to total savings of $15,000–$40,000 or more, especially in areas with high electricity costs and strong local incentives.
Several factors can accelerate your solar payback period, including high local utility rates, south-facing roofs with minimal shading, and low- or no-interest financing options. For example, a California homeowner who installs a $20,000 solar system and takes advantage of the 30% federal tax credit would reduce their net cost to $14,000. With average annual savings of around $1,800 on electricity, that system would pay for itself in less than eight years and continue generating free power for many more.
Going solar is a smart financial move, but it’s even smarter when you know how to maximize your savings. From federal tax credits to local rebates and smart shopping strategies, there are several ways homeowners can cut costs and get the best return on their solar investment.
One of the most effective ways to reduce your upfront cost is by taking advantage of solar incentives at the federal, state, and local levels.
Beyond incentives, there are smart strategies that can help you save even more on your solar panel installation.
For most homeowners, solar panels are worth it. Thanks to the 30% federal tax credit, state and local incentives, and rising electricity rates (currently averaging 15.95 cents per kWh nationwide), solar systems can save you around $42,376 over 25 years.*
If you live in a high-cost electricity state like California, where rates can top 30 cents per kWh, the financial benefits grow even stronger, especially if your household uses more than 900 kWh per month or enjoys consistent sun exposure.
But solar offers more than just savings. It provides real, lasting value in several key ways:
That said, solar isn’t right for everyone. It may not be the best fit if your roof is heavily shaded or needs replacement soon or if you plan to move within five years. Also, homes in areas with very low electricity rates or with minimal energy usage may see slower payback periods.
Still, for the vast majority of homeowners, the financial and environmental payoff makes solar well worth the cost and a solid investment in your home’s future.
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*Cost data is based on reports from the U.S. Energy Information Administration and uses the consumption of 10,632 kWh per year to calculate the savings.
In , we surveyed 1,000 home solar customers across the U.S. to understand their experience shopping for and installing solar panel systems. Most homeowners said they paid around $16,129 for a solar panel system, with an average of 14 solar panels installed.
While Sunrun was the most popular provider in our survey, many respondents reported choosing a local or regional installer rather than a large, national company. Additionally, 53% of respondents claimed they wanted solar panels to reduce power bills, and most reported an average decrease of $14 per panel, translating to $196 saved on monthly utility costs.
While solar panels offer great long-term savings and environmental benefits, it’s important to understand the less visible costs and considerations that can affect your overall investment. These aren’t deal-breakers for most homeowners, but knowing about them upfront helps you plan more effectively and avoid surprises down the road.
Here are some common hidden costs and potential drawbacks to keep in mind:
“If your home is located in an area with low solar access or if your home is shadowed by trees or buildings for much of the day, you probably won’t make back the investment on the electricity you generate. If you already consume low amounts of electricity (or if you consume a high amount), switching to solar might offer smaller savings, and so require a longer payback period.” —Mark McShane.
McShane is a solar industry professional and entrepreneur. He owns Skills Training Group, a company focused on producing high-quality solar technicians. He also runs Solar Panel Quote Online, a site that provides impartial advice and information to homeowners and businesses considering installing solar.
We consulted additional experts for insight into the benefits of solar energy, the affordability of solar panels, and advancements in solar technology. See their insights below.
The ongoing cost of owning solar panels is relatively low compared to the initial investment. After installation, you can expect to spend approximately $150–$300 each year on panel maintenance and monitoring. This annual expense covers occasional system inspections, basic cleaning, and performance monitoring.
Based on our survey of 1,000 solar customers, the national average price of a single solar panel professionally installed is $1,200. Note that this figure includes installation, mounting, and electrical work and not just the panel itself.
Sizing a solar system requires a clear understanding of your home’s energy consumption, rather than solely relying on its square footage. On average, the cost of a solar system for a 2,000-square-foot house is around $13,075, which includes a 30% reduction from the solar tax credit. Without incentives, the typical costs go from approximately $19,200–$22,000.
Your actual solar energy needs will vary based on several factors, including your home’s energy efficiency, number of occupants, appliance usage habits, and the local climate. For example, a 2,000-square-foot home in Arizona with central air conditioning year-round will require a much larger solar system compared to a similar-sized home in Vermont that relies on efficient heating for part of the year.
For homeowners, solar panels can offer a smart financial investment, primarily due to the 30% federal tax credit, which significantly lowers costs. With current average electricity rates at 15.95 cents per kWh, which is projected to rise by 2.5% annually, solar enables you to secure lower utility costs for 25 years. Over the system’s lifetime, typical power bill savings can reach approximately $42,376, based on our team’s calculations.
In high-cost areas like California, where rates can exceed 30 cents per kWh, the value of each kWh of clean energy produced is even greater, especially for households using over 900 kWh of electricity monthly. This underscores that solar panels not only offer immediate tax benefits but also protect against rising utility costs. The focus shifts from whether solar pays off to how quickly you can recoup your investment and the savings over time.
The timeline for when homeowners begin to see a return on their solar energy investment can vary depending on factors such as your system cost, energy consumption, local utility rates, and available incentives. However, most homeowners experience a payback period of 6–10 years. Considering solar panels last 25–30 years, solar system owners can continue to save money on power bills for over a decade after their payback period ends.
To provide the most accurate and current pricing for solar panel systems, we conducted in-depth market research by surveying 1,000 solar customers nationwide and analyzing industry reports. Our survey data offered insights into what homeowners have paid for solar panel systems, preferred financing methods, and popular add-ons. We also included pricing information obtained from reports by the SEIA and U.S. Department of Energy, as well as market resources like EnergySage and Angi. This wide lens allows our cost averages to reflect a comprehensive view of national pricing across the solar industry.
Prices shared in this guide represent the average cost of equipment and labor based on our research at the time of publication. Actual costs may vary depending on factors such as your location, solar installer, system size, equipment quality, and project scope.
The solar tax credit has been a boon to homeowners who want to invest in solar panels. Many of our members have told us how adding solar has allowed them to lower their electric bills or even bring those bills down to zero.
But if you’re thinking about going solar and leveraging the federal tax credit to do it, you have only until the end of to act. The solar tax credit had previously been available through as part of the Inflation Reduction Act. But Congress recently cut it short, along with other Residential Clean Energy Credits and energy-efficient Home Improvement Credits, as part of its latest tax and spending plan.
If you install solar energy equipment in your residence before the end of , you’re entitled to a nonrefundable credit off your federal income taxes equal to 30 percent of eligible expenses. There’s no dollar limit on those expenses; you’re entitled to that 30 percent tax break whether you spend $20,000 or more than $100,000 on costs associated with a residential solar system.
People who will reap the most benefit include those who pay a lot for their electricity (or expect to in the future), those who usually owe the IRS at tax time, those who plan to buy (not lease) solar panels, and those who expect to stay put in their homes for a while.
This is important information to understand when thinking about the timeline for getting solar panels operational. You should plan on the process taking up to a few months, and it varies according to where you live.
You need to factor in time to vet installers, get quotes (more on that below), and make sure your roof is a candidate for panels. Once you have a good installer and sign a contract, the installer should acquire the necessary permits, get approval from your utility company, install the panels, schedule necessary inspections, and lastly, get your utility company to connect your panels to the grid.
It depends on whom you ask. As we mentioned, the new tax and spending bill signed into law in July brings the solar tax credit to an abrupt end in . Starting Jan. 1, , there will no longer be a solar tax credit. But the bill language isn’t explicit about whether solar panels must be fully operational or not by the end of the year. (As of this writing, the IRS didn’t have any new guidance on its website, nor was the website updated with the new deadline.)
The solar advocacy group Solar United Neighbors interprets the new law to mean that solar panels must be fully operational by the end of this year to qualify for the credit. (The group emphasizes that it is not a tax adviser and can’t provide definitive tax advice.) But interpretations of the law vary.
“We are hearing very different things,” says Roger Horowitz, vice president of Go Solar programs at Solar United Neighbors. “A lot of installers are treating the end of the year as—if your system is installed, you’re good to go. More cautious companies are saying your system needs to be inspected.”
Is there still time to go solar and get the tax credit? Horowitz says yes. But consumers will need to sign a contract with an installer in a matter of weeks, and that contract should only come after thorough vetting. “Do your regular research, just on an accelerated timeline,” he says.
Working with an experienced installer is central to having a positive solar experience. Horowitz offers these best practices for vetting companies:
Get at least three bids. Start by looking at companies recommended by neighbors or others in your area who have had good experiences.
Go local. Find companies that have already been established in your area and have expertise with local permitting processes and utility companies.
Avoid door-to-door sales. Horowitz says he has heard of roving teams of solar salespeople looking to expand in certain jurisdictions but who don’t have an established local business yet. “First of all, we don’t recommend buying stuff door-to-door,” he says. If anything, “tell them, ‘Hey, give me your proposal. I always want to get three proposals.’ ”
Read online reviews. Make sure they’re good and plentiful. You’re looking for a contractor with hundreds of good reviews, not just a handful.
Check to see whether the company has signed an ethics pledge. Certain states and even counties have solar associations with ethics pledges that companies can sign. For example, Solar United Neighbors helped create an ethics pledge in Ohio.
Once you have found a company you want to work with, ask whether it can complete the work and have your solar panels operational by the end of to make sure you can qualify for the tax credit.
Horowitz says he has heard of companies telling customers they can complete the work as long as customers commit with enough lead time. Some companies may insist on having a contract signed as soon as Sept. 1. You’ll want to get this commitment in writing, Horowitz says, and ask what recourse you have if the installer isn’t able to complete the project by Dec 31.
The credit lowers your federal taxes. So if you spend $24,000 on a system, you can subtract 30 percent of that, or $7,200, from the federal taxes you owe. (You must take the credit for the year the installation is completed.) If, say, you would owe $7,000 in taxes before the credit, a $7,200 credit would drop what you owe to zero. You can’t get a tax refund for the $200 remainder.
You’ll save, too, in lower electricity bills because you’re using less energy from the grid. You may also get a credit from your utility company if you send excess energy back to it. How much you’ll save depends on a number of factors, including how much electricity your household uses, the size of your system, the amount of sunlight it gets, and local electricity rates. Real estate experts say a purchased solar system—as opposed to a leased one—can raise the value of your home when you sell.
It’s available to all taxpayers for their primary or secondary residence in the U.S. Taxpayers of any income level can take advantage of it. You can use it whether you itemize your taxes or take the standard deduction.
Keep in mind, though, that the solar tax credit is available only if you purchase a solar system; if you lease one, you can’t take advantage of the credit. The same applies if you’re a member of a power-purchasing cooperative. But if you’re a tenant-stakeholder in a co-op, you can claim credit for your portion of the purchase. You can also claim credit for your portion of the purchase of a community-owned solar system.
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