Solar Panels Installation Cost

How Much Do Solar Panels Cost?

National Average
Typical Range
$15,513 – $29,028
Low End
High End

Installing a solar panel system costs an average of $22,129. Depending on the kind you prefer, you could pay as little as $2,000 or as much as $40,000. However, most homeowners pay between $15,513 and $29,028.
With energy prices on the rise, this may be the perfect time to go solar. Especially considering that improvements in this field of technology have made it more cost-effective and easier to set up. Homeowners have several options available to them which weren’t on the market in decades past and which fit a variety of budgets. Here are a few things to consider that will affect how much you pay.

Types & Costs of Solar Panels

There are three types common in the residential market. Each one has its own pros and cons, from price to efficiency. It is important to understand their differences when deciding which will work best for your home and energy needs.
Solar Panel Costs
Type Efficiency Space Needed per KW Cost per Watt (Retail) Life Expectancy
Monocrystalline 17% – 24% 65-100 sq. ft. $1 – $1.50 25 – 35 Years
Polycrystalline 15% – 20% 85 – 100 sq. ft. $0.90 – $1.00 23 – 27 Years
Thin-Film 7% – 14% 100-215 sq. ft. $0.70 – $1.00 14 – 17 Years

Monocrystalline – $1.00-$1.50 per watt

This technology will get you the most energy efficiency while taking up the least amount of space. Their solar cells are made up of a high-purity silicon which is very efficient at converting the sun’s light into electricity. A sheet of silicon is cut to form solar cells, which are arranged to create panels. These have the longest life expectancy and often come with a 20 to 25-year warranty.

Polycrystalline – $0.90-$1.00 per watt

These have a lower efficiency than Monocrystalline, but they fit better into smaller budgets without taking up a lot more space. In the manufacturing process, multiple crystals of silicon are melted and poured into molds to form the solar cells. This makes the silicon less pure and less efficient, but it cuts down on waste and production cost. The resulting modules are blue in tint.

Thin-Film/ Photovoltaic – $0.70-$1.00 per watt

These are extremely flexible and versatile, made by layering photovoltaic material on metal or glass. They cost less, but they will require a lot more space in order to power residential homes. They also have a shorter lifespan, lasting an average of 14 to 17 years. Therefore, they come with shorter warranties. One benefit of thin-film technology that has the others beat is its high tolerance to heat.
The efficiency of thin-film technology will depend on the photovoltaic material used. Amorphous silicon, for example, will only operate at 7%-9%. CdTe and CIS/CIGS operate at about 10%-14%.

Estimated Solar Energy System Prices Per Watt

The per-watt price of installing solar ranges from $2.50 to $4.00. You’ll see the greatest difference between the Southern and New England regions. This does not necessarily mean that it is less cost-effective in New England as opposed to other regions. Different states, even different counties, will have varying returns on investment dependent on other factors. These factors include: state and local incentives, average electricity bills, and the amount of sunshine expected per day.
Below you will find the average rates of having your system professionally installed, according to region and wattage. These figures do not include any tax credits or incentives. Consider that the average size is 5kw. Hawaii, included in the Western region, has the highest rate per watt at $3.40 to $4.00. Georgia, in the Southern region, has the lowest at $2.75 to $3.50.
Cost of Installing Solar Panels by Region
Size New England Mid-Atlantic South Midwest, Southwest,
& West
2kw $6,500-$7,300 $6,300-$7,300 $5,900-$6,800 $6,000-$7,000
3kw $6,500-$7,300 $9,500-$10,500 $9,000-$10,200 $9,000-$10,500
4kw $13,000-$14,500 $12,500-$14,200 $12,000-$13,500 $12,000-$14,000
5kw $16,500-$18,200 $15,800-$17,800 $15,000-$17,000 $15,000-$17,500
10kw $33,000-$36,000 $31,500-$35,500 $30,000-$34,000 $30,000-$35,000

Price of Installation

The cost of labor and overhead can significantly outweigh that of materials. In fact, panels tend to make up only 34% of your final price.
Total Solar Panel Installation Costs
Expense Percentage Example: 5kw @$3/kw
Labor 15% $2,250
Permit/Inspection Fees 3% $450
Inverter 10% $1,500
Mount 5% $750
Other (Mktg, Overhead) 33% $4,950
Panel 34% $5,100
Total $15,000
When you are shopping around, it is vital that you do your research and get multiple quotes. You may be surprised by the difference in offers. This is owed to the significant chunk of “soft costs” integrated into the overall rate. As you can see above, the ‘other’ category takes up about a third of your total project budget.
Buyers who explore the market thoroughly could save thousands of dollars on their installation. This is especially true when comparing large companies to smaller ones. Well-established companies can charge more because they serve 90% of the market and are not necessarily in direct competition with their smaller counterparts. They also have higher marketing and overhead expenses to cover. You may also be looking at a higher budget if the surface of your roof is more difficult to work with.

Costs per KW

Considering that the average price of labor per watt is $0.50, the following chart reflects the average cost of labor for the various system sizes.
Size Labor
2kw $1,000
3kw $1,500
4kw $2,000
5kw $2,500
10kw $5,000

Make & Install Solar Cells

It is possible to set your system up yourself, but it is certainly a complicated project. In fact, if you do not have electrical experience, you are likely going to need to hire labor to install your system either way.
DIY kits fall around $1.50 to $2.50 per watt. Add to that average labor rates to have your kit set up safely, by a certified electrician, $0.50/watt. This puts your DIY budget at $2.00-$3.00/watt. Considering that having the entire process handled by a professional contractor averages around $2.50-4.00 per watt, you may not be looking at a lot of savings.
Size DIY Contractor
2kw $4,000 – $6,000 $7,000
3kw $6,000-$8,000 $10,000
4kw $8,000-$11,000 $13,000
5kw $10,000-$14,000 $16,000
10kw $20,000-$27,000 $32,000
Going with a professional has many benefits and the price difference is often insignificant. A professional will be able to help you with design, will be able to get higher quality products and materials at a lower rate, and will also be useful in acquiring permits and tax credits.

Connecting to the Grid

Most solar kits are designed for off-grid systems, which wouldn’t demand as much energy as the average home, such as tiny houses or sheds. A typical off-grid PV system costs about $2.50/watt.

Grid-tied packages range from $2.00-$4.00/watt. The grid can be very useful, providing electricity at night or in times of low sunlight. Being connected requires more components, such as meters and safety equipment. You will need to consult your local utility company about regulations and hire a licensed electrical contractor to connect you.

Building from Scratch

If you have a high level of electrical skills, you may be toying with the idea of building your own solar panels. The silicon wafers used to create them are available to purchase individually. In order to build your own, you would typically put 60 of these wafers onto a backing and wire each of them. You would then need to connect this to an inverter.
Consider, however, that there are several risks associated with building your own, including:
  • You can’t be sure of the quality of solar cells purchased.
  • Homemade panels are often a fire hazard.
  • Many tax credits and incentives will not apply when systems are constructed outside of approved facilities.

Type of Mount

There are three different types of mounts for affixing your solar panels to your home. Similar to the panel types, the least expensive option is the least efficient and the more expensive options are more effective.
  • Fixed – $10-$15 per. These are completely stationary and cannot be adjusted to capture more or less sunlight depending on weather and season. They are the least expensive type of mount. Installing this mount is optimal in regions where continuous sunlight can be expected, as adjustments wouldn’t be as necessary in order to maximize on energy production.
  • Adjustable – $50 per. These can be tilted depending on the intensity of the sun or the season. They are more expensive than the fixed mounts but will have more energy efficiency. Adjusting the panels to soak up more sun in varying seasons will equate to greater energy production. These adjustments can also be useful when the weather turns, as you can lay them flat to avoid damage from wind.
  • Tracking – $500-$3,000+ per. Follows the arch of the sun and provides maximum efficiency. The amount of energy you will be able to generate depends not only on panel construction and mounting but your location. Though the initial cost for tracking is higher than other mounts, these can often get you the highest return on investment, as they make the most of every ray of sunlight. Track mounting may add 45% energy production.
Expect higher maintenance demands to keep moving parts working well. The typical expense of maintaining and repairing solar panels is $150-$1,000, without factoring in the mount. Where fixed and adjustable mounts will simply need their bolts tightened every now and then, those that track will need more attention. You could find yourself spending up to $2,500 in repairs and maintenance.


Is Solar Energy Expensive?

The size of your panel installation and the needs of your home will affect your costs. An average-sized system (roughly 5 kilowatts) will cost between $25,000 and $35,000. Larger installations will require more hardware, planning and construction time. This can further increase costs. While solar panels are expensive, they have distinct benefits:
  • Savings: An average-sized system (5 kilowatts) can reduce up to 50% of your monthly electricity bill. Over a period of 20 years, these savings can add up to $30,000, based on your location and energy usage. Federal tax incentives are also making it easier to purchase systems.
  • Flexible payments: Solar purchase power agreements (PPAs) allow homeowners to purchase their panels with little to no money down. PPAs give homeowners immediate access to utility savings.
  • Increased Home Value: Lower utility bills improve the value of your home. In fact, the National Renewable Energy Laboratory (NREL) concluded that homes with solar panels sold for 17% more than homes with conventional utilities.

How Much Does One Solar Panel Cost?

Solar panels normally retail for around $1 to $3 per watt and range between 150 and 350 watts per panel, making the average cost of a single panel between $200 and $350. If you’re installing one panel, high-quality, high-output options are ideal. Here’s a look at the efficiency of common panel types:
Monocrystalline panels: 15% – 20% efficient
Polycrystalline panels: 13% – 16% efficient
Thin/film panels: 7% – 14% efficient
Many retailers sell panels individually and as part of a larger system. It’s important to factor hardware and installation costs into your single-panel project as well. This portion of your installation can make up as much as 30% of your overall cost.

What’s the Cost of Solar Panels Per Square Foot?

They are rarely sold by the square foot. Instead, most retailers and pros sell panels by the watt. You can expect to pay between $1 and $3 per watt.

Reduction in Energy Costs

A great first step in determining which products are right for your home is to conduct a Home Energy Audit. A home auditor will do a detailed inspection of your usage and areas where you can improve to help you determine if you would benefit from a solar system. From there, a pro can help you to select the right location, size, mounts, and panels to maximize savings.
Although you may hesitate to spend the money on the most expensive types of panels and mounts, it is good to remember that you will save money on the other side with decreased electricity bills. It could be that what you spend up front will pay for itself very quickly in your reduced monthly bills. Depending on where you live, the amount of sunlight your area gets daily and the average rate of electricity in your state, you could save up to and beyond $20,000 over the next twenty years.
In Washington, for example, the average savings for solar-powered home is only $7,500, where the average cost is $14,600. This is partially due to Washington’s low electricity rate compared to most other states. It is also owed to the fact that Washington gets a lot less sun than the rest of the country.
Massachusetts, on the other hand, continues to be the top-performing solar state. The average spent is just over $14,000, while the savings over 20 years is over $30,000. Again, this is due in part to the electricity rate, which is higher than average for the country. Massachusetts is also ahead of the curve in terms of policies. The average recoup time on a 5kw system in this state is only four years.
You can enhance your savings by selecting products with higher efficiencies and investing in track mounting. Track mounting will ensure that your system absorbs all the light it can, and high-quality panels will be able to capture and convert that light at a greater rate.

State & City Subsidies

Thanks to the Energy Policy Act of 2005, homeowners enjoy a 30% federal tax credit on their cost. This tax credit is not factored into the figures above. It is known as the Investment Tax Credit (ITC), or federal solar tax credit, and the savings can be considerable.
Individual states and cities offer their own policies, incentives and credits, as well. Some utility companies will even offer 10 to 20% rebates on your installation. With these incentives, combined with the ITC, you may be able to save as much as 50%. You can explore the Database of State Incentives for Renewables and Efficiency to find the incentives unique to your area. This database also lists various loans and grants available.
  • In Washington, where a financial incentive could do a lot to motivate homeowners, one utility company rebate offers up to $2,000 back on your investment.
  • In Massachusetts, the number one solar state, there are utility companies which offer rebates of $0.50/watt and up to $625/kW.
  • New York State offers a state tax credit of 25% for PV systems.
  • Florida has a permanent sales tax exemption for solar energy products. There are also several utility companies in Florida which offer $500 rebates on solar water heating systems, which cost an average of just over $3,500.