How Much Does Solar Cost?

How Much Does Solar Cost?

You’ll hear the same thing from every company you call, “it depends.” This isn’t just a ploy to get your personal information and bombard you with sales calls. The final price of a solar system really does depend on a number of factors, such as: the system’s size and orientation, equipment options, configuration, labor costs, and local permitting costs. The size of the solar system being the determinant factor in it all, a factor determined by your family’s individual needs.

What Determines The Cost

In most cases, when you receive a solar quote it will be given to you based on a DC measurement. A simple way to break down the cost of solar is to calculate a price per DC watt. This is used frequently with solar companies quoting systems because of it’s simple formula: the wattage of the panel multiplied by the number of panels in the system. For example, If you take a solar power system with twenty five 200-watt solar panels, your system size is 5,000 watts.

The Central Valley of California has competitive solar market, and prices vary  drastically from company to company. In the year 2017, solar companies are quoting people anywhere between $2.50 to $4.00 per DC watt for a solar system. Given that the size of an average residential solar installation is 5.0 kw, it would cost someone $12,500 to $20,000 to have solar installed on their home this year. This price is without the federal tax incentive (ITC) factored into the pricing, which can lower the cost another 30% if you are eligible.

The Solar Energy Industries Association states, “The Solar Investment Tax Credit (ITC) has provided industry stability and growth since its initial passage in 2006. In the last decade, solar has experienced a compound annual growth rate of more than 60%”( Starting January of 2020, this credit will begin to decrease (26% in 2020, and 22% in 2021) before it is projected to disappear all together in 2022 for residential solar. This 30% credit if only applicable if you are able to recover funds from a tax credit; please consult your tax professional for verification. This can have a significant impact on lowering the price of a system for qualified homeowners, and may push many residents to go solar in the next few years before the policy comes to an end.


Usage & Energy Bills

The most important piece of information a sales consultant will need when pricing a system for you will be your energy usage in kilowatts. Many times this information is given to the consultant over the phone or at the time of consultation, along with your past 12 months of utility bills. From there, the consultant can design a system of appropriate size to offset your usage.


Equipment Options

The ultimate goal of any homeowner should be to produce the power you need as inexpensively as possible, without sacrificing quality of equipment or workmanship. Some of our clients come to us knowing exactly what they want when it comes to equipment selection, but the majority people are only beginning the research process.

Fortunately, our team of consultants are not only qualified to select the best panels and equipment based on your energy needs and financial situation, but they do honest business. This means not over promising and under delivering. You may have heard “not all solar panels are created equal”. This is true for the most part, but that doesn’t mean you have to spend and arm and a leg to get a highly-efficient, great looking solar system installed. If you need help getting started on your research, visit our blog article What Solar Panels Do I Buy? at →


Roof Space & System Orientation

The second most important thing you can provide your sales consultant with is your home address. This can be is used to view your roof online and map out possible locations for the solar system. If you chose to set up an in home consultation with your salesman, the he or she can perform a simple site inspection and view your home’s roof condition and layout.

Using fewer panels to produce the power you need results in a smaller and less expensive system. South facing arrays are best for solar, since that is where panels absorb the most sunlight hours. There may be other solutions available if you do not have sufficient space on your roof for the size of system you need, but have room on your property for an additional structure.


The Payback

A payback period is how much time it takes to “break even” on the investment you’ve made. According to experts, “The average payback period for a residential solar electric system is between 6-9 years, depending of the cost of the system and the utility bill savings” ( Good news is the price of solar has dropped 10% in the last year alone. At the same time the price of using energy seems to be steadily increasing, giving valley residents a real reason to invest in renewable energy. If you’re interested in how to get the process started, we’d love to provide you with some free information and a quote for owning your own solar system.

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