What Is the Average Cost of Solar Panels for a Home?

Feb 13, 2018

With environmental issues and sustainable energy usage on the forefront of many people's minds, solar energy is a solution that has gained notable popularity. In order to live green, though, you’re going to have to spend a little green to make it happen. This leaves many to wonder what the average solar panel cost actually is.

Although you’d think determining an “average” cost would produce a straightforward answer, it’s a lot more complicated in reality. A number of factors must be taken into account before a price can be calculated. These factors include: where you live, the kind of house you live in, whether you qualify for tax incentives, or even whether you are buying your solar panel system or leasing it.

There’s a lot to consider other than the solar panel itself, and one person’s cost can greatly differ from someone else’s. Your best bet will be to get a quote from a solar energy supplier and installer in your area to find out how much solar panels for homes cost. In the meantime, you can get an idea of what your bill will look like by reading the information below.

Average Cost of Solar Panels

So, how much are solar panels for your home? First, we’ll take a look at the average cost of panels on their own. Since multiple variables are at play when it comes to the pricing of a solar energy system, each one needs to be considered when making this purchase. In the end, two variables will affect final cost the most: the price per watt, and the price per square inch for your desired solar system.

Price per Watt

Due to the varying efficiency between different systems or panels and the multiple sizes and energy needs of homes, solar panels need to be priced in a way that reflects those differences. That’s why you’ll see most systems sold by the watt. By using a unit of power for a unit of price, individuals can pick solar panels that most accurately depict their household’s energy usage.

When you discover how much energy you currently use, you can estimate a more accurate cost and choose a solar panel system that will fit your needs the best. Although prices differ from manufacturer to manufacturer, the average cost is around $1 per watt.

Price per Square Inch/Foot/System Size

The overall size of a solar energy system can also affect the price you pay. The more energy you want, the more equipment you’ll need and the longer it will take to install the panels. This results in an increasingly larger bill.

However, as the size of the system increases, the price per watt will actually decrease. Since solar companies have specific overhead expenses they must account for, they’ll be able to deduct expenses from your bill if you buy a solar panel system that costs a little more.

If you want to buy panels by the square inch or foot, you’ll likely be out of luck. For the most part, solar panels aren’t sold by inches or feet. As mentioned before, cost per watt will be the most common pricing you’ll encounter.

Average Price of Solar Panel Installation

Much like the solar panels themselves, the installation of a system is priced by the watt. Costs vary, but you can expect to pay around $3 per watt with a final cost of about $20,000. However, many things can affect what you’ll end up paying.

Before you even install a single panel, there are steps you need to take that will add to your final bill. You’ll need to file permits in order to use solar energy and arrange a professional to visit and evaluate your home.

Some houses will require little to no effort to install solar panels, but depending on the direction your house faces, the angle and set up of your roof, and how many stories your home has, the installation cost can change due to additional labor.

Fees will also need to be paid in order to connect your solar panels to the grid and to design a system that will fit your house and needs. The installation company you go with will be a big determining factor in installation costs as well.

It’s wise to shop around and get quotes from as many solar companies as you can since some of the bigger and well known companies can charge thousands of dollars more than the smaller installers in your area. It’s also advised to look at the equipment these companies have to offer.

Some solar panels and inverters will be more efficient than others, generating more energy with the same amount of sunlight. It’s best to do your research before you spend any money so that the system you choose is the best one for your situation.

By State

Even the state you live in can affect how much your expenses will be. Prices will vary based on your location due to a variety of factors that will be discussed later on. No matter which state you live in, though, the Energy Policy Act of 2005 makes it so that individuals receive a 30% federal tax credit (which will be factored in the list below) on their solar energy system purchase. So in the meantime, take a look at some estimated installation prices for a 5kw system so you can get a better idea of what your final cost will be based on the state you live in:

  • Alabama: $10,150
  • Alaska: $10,850
  • Arizona: $11,025
  • Arkansas: $9,940
  • California: $11,130
  • Colorado: $10,920
  • Connecticut: $11,830
  • District of Columbia: $11,515
  • Delaware: $10,500
  • Florida: $10,080
  • Georgia: $9,730
  • Hawaii: $11,970
  • Idaho: $10,325
  • Illinois: $10,920
  • Indiana: $11,130
  • Iowa: $10,290
  • Kansas: $10,395
  • Kentucky: $10,815
  • Louisiana: $10,500
  • Maine: $11,480
  • Maryland: $10,500
  • Massachusetts: $11,445
  • Michigan: $10,535
  • Minnesota: $11,165
  • Mississippi: $10,325
  • Missouri: $10,500
  • Montana: $10,500
  • Nebraska: $10,080
  • Nevada: $10,360
  • New Hampshire: $11,410
  • New Jersey: $11,270
  • New Mexico: $10,780
  • New York: $11,480
  • North Carolina : $10,290
  • North Dakota: $10,500
  • Ohio: $10,430
  • Oklahoma: $10,500
  • Oregon: $10,920
  • Pennsylvania: $11,130
  • Puerto Rico: $11,830
  • Rhode Island: $11,340
  • South Carolina: $10,780
  • South Dakota: $10,500
  • Tennessee: $10,920
  • Texas: $10,920
  • Utah: $10,500
  • Vermont: $11,480
  • Virginia: $11,060
  • Washington: $10,325
  • West Virginia: $10,500
  • Wisconsin: $10,990
  • Wyoming: $10,500

Other Factors That Influence the Cost of Solar Panels

Besides the actual cost of equipment and installation, there are other variables that will determine how much solar energy systems will cost.

Type of Solar Panel

There are three types of solar panels you’ll commonly find for home use. Starting with the most budget friendly are thin-film or photovoltaic solar panels. Despite its inexpensive price tag, the equipment takes up quite of bit of space if your goal is to power your entire household.

From the three types, thin-film solar panels last the shortest amount of time, needing to be replaced every 14 to 17 years. Although efficiency depends on the quality of the photovoltaic material, this solar panel is still the least efficient. However, thin-film panels are still an attractive option due to its high heat tolerance, making it a good choice for people who live in warmer climates.

In the mid price range we have polycrystalline solar panels. These panels take up much less space than thin-film, but it’s still not as efficient as it could be. Although the manufacturing process of polycrystalline lessens the quality of the solar cells, waste is minimized and cuts down on overall cost.

This option is good for individuals with smaller budgets or small amounts of available space. The more expensive of the three types are monocrystalline solar panels, but they are well worth the cost. Not only are these solar panels compact in size, it’s also the most efficient at converting sunlight into energy.

Since monocrystalline panels are comprised of high grade silicon, they last longer than both thin-film and polycrystalline panels. When it comes to the price per watt of all three, each one is actually under $2 and differ only in cents.


Where you live has a definite impact on solar panels’ cost for home. Some states receive more hours of sunlight than others, in turn affecting how many solar panels you’ll actually need to power your home.

If you live in an area that gets plenty of sunshine throughout the day and year, you won’t need as many panels as someone who lives in a state with a limited amount of sunlight. How popular solar energy is where you live will also increase or decrease prices.

The more companies have to spend on marketing to attract customers, the more their prices will be to cover those costs. Just the overall cost of electricity itself will influence how much you’ll pay if you want to buy solar panels for home.

Additional Subsidies

Not only does the federal government give you a tax credit for solar panel systems, but your state and city too. There are a variety of incentives and rebates you can take advantage depending on where you live. To find out what you can save, visit the Energy Department’s site as well as the Database of State Incentives for Renewables & Efficiency for information on your state. Leasing is also a viable option when you don’t have the money upfront to buy your own system.
Now is really the best time to go solar. With so many plans to choose from, there’s a solar energy system that’s just right for you. It can get confusing figuring out what the final cost will be, but with plenty of financing options and federal and state incentives and rebates, your energy usage can become a whole lot sunnier.

Image Source: Pixabay

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