Did you know that by the end of 2020, approximately 2.7 million people were using solar systems for their homes in the United States? You’ve likely heard a lot about the benefits of having a residential solar panel installation and how they can significantly reduce your energy bills long-term.

But the big question is, how much do solar panels cost, and what do you need to look at if you’re considering getting solar panels for your home?

Keep reading this guide to learn about the average cost of solar panels and what you can expect from the process.

How Much do Solar Panels Cost?

The size of a solar system is measured in kilowatts (kW). This number tells you the most amount of power your solar panels will be able to deliver when the conditions are perfect.

On average, the cost of solar panels in the US ranges between $17,000 and $35,000, and you’ll spend approximately $2.50 and $3.50 per watt.

However, this number can vary, and there are different factors to be aware of that effect the solar panel prices you’ll pay. These factors include:

Your Electricity Usage

A significant part of the cost of home solar panels depends on how much electricity you use on a daily basis. If your energy use is high, you’ll need a larger system and more solar panels to meet your needs. 

To determine this, you’ll need to gather your electric bills to check how many kilowatts an hour you use each day, and you’ll be able to average out your monthly and yearly usage from there.

Most families in the US use between 11,000 and 12,000 kilowatts each year and need between 25 and 34 solar panels to power their homes.

Your Location and Sunlight Exposure

Where you live can greatly affect the total cost of going solar. First, you’ll need to consider the average amount of sunlight your state gets each year.

The less direct sunlight your home gets, the more solar panels you’ll require for your energy needs, so you’ll pay a higher price. On the flip side, if you live in a sunny location, you’ll need fewer solar panels to meet your energy needs.

In addition, the orientation of your home towards the sun is a huge factor. Even if you live in a sunny area, if your home is in a shady location, you’ll have to adjust the number of solar panels you get. 

Size and Condition of Your Roof

The shape and size of your roof directly affect your solar panel cost. If you have a small roof, it may not be able to hold the number of solar panels you’ll need for your average energy usage. You even keep a chimney if that is something you like, but we recommend to seal it with help from top contractors like the chimney maintenance experts at Chimcare.

Also, labor costs can widely vary depending on your roof’s material and angle. You can consult this with a roofing contractor to be certain, but just to provide an example, asphalt shingles and tile roofs work well with solar panels and make for an easy installation process. On the other hand, installing solar panels on wood or slate roofs is more difficult since these types of roofs are more brittle. If you’re looking for high-quality commercial roof repair services, consider Colony Roofers.

Finally, you’ll need to look at your roof’s overall condition. If your roof is new and in good condition, it should be able to handle solar panels. However, if your roof is nearing the end of its lifespan and needs repair work, you may have to get a roofing replacement before installing solar panels.

Types of Solar Panels

You can use three types of solar panels for your home: monocrystalline, polycrystalline, and thin-film solar panels.

The efficiency, cost, and types of materials vary for each of these, so you’ll need to talk to a solar panel installation company to determine which would work best for your home.

So if you’re considering solar, it’s best to look at reputable solar installation companies to get a better handle on these options.

Equipment and Labor

It’s important to realize that over half of your budget will go towards equipment and labor costs. You’ll need to consider things like cables, wiring, and mounting hardware.

In addition, you’ll need to decide if you want an off-grid or on-grid solar power system. On-grid solar systems are connected to your utility company’s network, while off-grid systems are not connected. For off-grid systems, you’ll need to purchase a generator and solar battery for energy storage. 

Finally, you’ll have to calculate the total labor costs. Remember, the larger your system is, the more labor costs you’ll have. Also, your costs will increase even further if your home has skylights, multiple stories, or a difficult roof angle.

State and Federal Incentives

State and federal solar power incentives will also affect your total cost. First, you can take advantage of the federal residential solar energy tax credit.

With this credit, you’ll be able to claim 26% of your total solar installation cost on your taxes if you get a solar system in 2022. In 2023, the amount of this credit will reduce to 22%. The credit covers things like your solar panels, batteries, additional equipment, and labor costs.

Depending on the state you live in, you can also qualify for extra incentives. Some states offer solar incentives like cash back on your system, property tax exemptions, sales tax exemptions, and a reduction on various permit fees.

You’ll need to check with the solar installation company you choose on what tax credits and incentives you’ll qualify for. Reputable solar installation companies will provide up-to-date information on available incentives and help you apply for them.

Financing Options

Many people don’t have the cash on hand to pay for a solar panel system, so you’ll likely need to look at financing options. 

Most solar installation companies offer solar loans, so you’ll make monthly payments plus additional interest. You’ll also find solar leasing options much like leasing a car. You’ll pay to lease solar panels, typically over 25 years.

Keep in mind if you lease your system, you don’t maintain any ownership and won’t be eligible for state and federal solar incentives.

All in all, with financing, your total cost will go up due to the additional interest and fees you’ll need to pay.

Look at Solar Panel Installation Today

Now that you know the answer to the question, “how much do solar panels cost” you’ll be better able to plan your budget.

Although solar panels cost a significant amount of money upfront, the reduced energy consumption and boost to your property value make them well worth the investment. Start shopping for off grid solar kit | Shop Solar Kits today.

For more helpful tips, check out the rest of our blog for business and DIY tips that will make your life easier!