How Much Do Solar Panels Cost in the U.S. in 2018?

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solar panels cost in the u.s. graphicYou’ve probably heard about how solar energy can reduce your electricity bills, but how much do solar panels really cost? The easiest way to calculate the average cost of solar panels is to look at its price in dollars per watt, which is relatively consistent across the United States.

How much do solar panels cost?

In 2018, solar costs will range from $11,380 to $14,990 (after tax credits). Because price paid per watt ranges from $2.71 to $3.57 and the average U.S household system size is 6 kW (6,000 watts), the average gross solar panel cost is $18,840

That’s six and a half percent lower than it was a year ago, and solar panel system costs are continuing to fall. However, to really understand what a single solar panel will cost and what a complete solar system will cost for your house, it’s important to compare prices quoted to homeowners in your area – total costs can vary depending on the state that you live in. Here’s a breakdown on how the total cost is determined:

Average cost of solar panels based on system size

Knowing the average cost per watt is helpful, but what does $3.14/watt actually mean for you? The cost of installing solar for your house or business depends on how much electricity you want to generate – a bigger system will cost more, because you’ll need to buy more equipment and more labor will be needed to install it.

The average solar energy system size in the U.S is approximately 5 kilowatts (kW). Based on the average price of $3.14/watt, a 5kW system would cost $10,990 after tax credits. Below are some average 2018 quotes for other solar energy systems by size:

Solar panels Cost System size in kilowatts (kW)
Standard system $13,188 6kW
Mid-large system $17,584 8kW
Large system $21,980 10kW

These prices reflect the cost of a solar energy system after deducting the federal solar tax credit, which reduces your solar system cost by 30 percent. Some states, local governments, and utilities also offer rebates and other tax incentives that can further reduce the solar system costs in your quotes from solar installers.

The price of solar panels will also vary from state to state. EnergySage analyzed quote data from the EnergySage Solar Marketplace to develop a range of solar panel system prices for top solar states:

Solar panel pricing in U.S. states table

State Solar price range (6 kW) Solar price range (10 kW)
Arizona $10,332 – $12,096 $17,220 – $20,160
California $11,928 – $15,204 $19,880 – $25,340
Colorado $11,676 – $14,952 $19,460 – $24,920
Connecticut $12,222 – $15,078 $20,370 – $25,130
Florida $9,198 – $11,970 $15,330 – $19,950
Illinois $11,424 – $13,944 $19,040 – $23,240
Maryland $10,332 – $12,768 $17,220 – $21,280
Massachusetts $12,264 – $15,372 $20,440 – $25,620
New Hampshire $12,096 – $14,868 $20,160 – $24,780
New Jersey $11,802 – $14,574 $19,670 – $24,290
New York $12,264 – $16,044 $20,440 – $26,740
North Carolina $10,500 – $14,196 $17,500 – $23,660
Ohio $10,374 – $13,062 $17,290 – $21,770
Oregon $11,802 – $15,162 $19,670 – $25,270
Pennsylvania $11,634 – $14,490 $19,390 – $24,150
Rhode Island $13,104 – $15,792 $21,840 – $26,320
South Carolina $11,886 – $14,574 $19,810 – $24,290
Texas $10,962 – $13,818 $18,270 – $23,030
Virginia $10,416 – $13,356 $17,360 – $22,260
Washington $9,954 – $13,650 $16,590 – $22,750

NOTE: These ranges are system prices after the 30 percent federal tax credit for solar. 

Remember, while bigger systems may cost more, they also should result in more savings. If you need to install a 10kW solar energy system to cover all of your electricity use, you might have to pay more out of pocket, but you’ll be cutting a significant monthly expense – your utility bill – and saving more money as a result. $0-down, low-interest solar loans are becoming increasingly common, making it even easier to buy a solar panel system and maximize your solar savings.

Solar energy installation cost by state (dollars per watt)

As interesting as it is to look at average solar panel cost in the United States, it’s also very helpful to understand what solar will cost in each state. Prices can vary significantly depending on where you live. A number of factors impact this variation – one of the most influential is the cost of electricity. That’s one reason for why Florida’s average solar cost is so much lower than the cost of solar in Massachusetts – electricity costs in the Northeast are high when compared to the rest of the U.S. Take a look at the table below, which contains average prices by state from 2018.

2018 solar prices: average cost per watt by state

The biggest takeaway from this data isn’t that some states are “better” than others when it comes to solar prices: it’s that solar panel cost is low and affordable across the board. Almost every state falls within a $0.50 cent margin of the $3.14 national average for 2018. An additional takeaway is that many of the top 10 solar states in the U.S. for installed capacity are higher than the national average for cost per watt (including the nation’s leader California). Clearly, solar isn’t only worth it in the regions of the United States where costs are extremely low – there is a healthy trend of adoption across the states without direct correlation to lowest cost per watt.

How much does a single solar panel cost?

Many homeowners are wondering how much a single solar panel costs as a way to understand the overall breakdown of their system or to calculate estimates for DIY solar projects. The simple answer is that it depends on the amount of leverage a buyer has, the type of panel, and the size of the system.

For example, because solar installers have direct relationships with distributors and can buy in bulk, they can often purchase solar panels at a rate much lower than the average consumer. Solar companies can typically get a single solar panel at a price of $0.75 per watt. Therefore, if the solar panel output is 250 watts, that single panel might cost you $187.50. However, if a homeowner is trying to buy one or two panels on their own for a small DIY project, they will likely pay closer to $1 per watt. That means the same solar panel could cost closer to $250.

For those looking for a range for the cost of solar panels, the cost will run from as low as $0.85 per watt to $1.25 per watt with output ranging from 150W to 350W for a typical solar panel. If those numbers seem low, remember that an installation has added costs thanks to the inverters, solar batteries and other additional equipment needed for a complete solar energy system. Overall, there’s no question that the equipment will be significantly cheaper when working with a solar installer rather than trying to find a deal online as a consumer.



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Factors that impact the cost of solar panel installation

A home solar quote contains the all-in price that you’ll be expected to pay when you install a solar energy system on your roof. As you start to explore solar offers for your home, you’ll notice that there are pricing variations between installers – what are the factors that make up the cost of your solar energy system?

First, there’s the equipment. Not all solar panels (or inverters) are created equal, and more efficient equipment comes with a higher price tag. More efficient, higher-quality equipment comes with benefits that may be worth the added cost, however: better hardware can produce more electricity with the same amount of sunlight, and often comes with a more comprehensive warranty, too.

solar panel cost data over time

The cost of solar panel installation on the EnergySage Solar Marketplace over the past 3 years

While equipment costs make up a significant portion of your solar energy system quote, the cost of permits and labor are also a factor. Typically, you will have to pay a fee to get your solar energy system connected to the grid. Additionally, there’s a significant amount of manpower required to take your solar idea to a reality – designing a system, coordinating a site visit, filing permits, and installing the solar panels all take time and cost money.

The characteristics of your home can also play a part in your total costs. If you have a south-facing roof that slopes at a 30-degree angle, installing solar on your home will be very easy, because there are no additional accommodations to be made. Conversely, if your roof has multiple levels, dormers, or skylights, the additional effort to finish the installation may bring (slight) additional costs.

Another factor that can increase the cost of your solar energy system is marketing and sales spending. Solar installers spend money trying to attract customers, whether through phone calls, door-to-door salespeople, flyers, or other forms of direct advertising. Luckily, this is a cost you can control: by using an online comparison-shopping platform like the EnergySage Solar Marketplace, you can lower the costs your installer would otherwise incur by trying to market to you.

Solar panel savings calculator: how much can you save with solar?

So how much are your neighbors actually saving over 20 years as a result of installing a solar energy system? As you might expect, this depends on where you live. For example, homeowners will save about $17,000 on average in Portland when they go solar. In Boston, homeowners will save about $43,000 on average, and in Los Angeles, homeowners can save a whopping $50,000 over 20 years.

Top cities for 20-year solar savings in 2018

Your solar panel payback period will also depend on where you live. The average U.S. household can break even on their solar energy system in just 7 years, but in many cities that number is even lower – Jersey City, Washington DC, and Boston all have payback periods of six years or less. In order to calculate your own customized instant savings estimate based on your roof and not just your city, try our solar savings and cost calculator.

Three Tips for Solar Shoppers

  1. Homeowners who get multiple quotes save 10% or more

    As with any big ticket purchase, shopping for a solar panel installation takes a lot of research and consideration, including a thorough review of the companies in your area. A recent report by the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) recommended that consumers compare as many solar options as possible to avoid paying inflated prices offered by the large installers in the solar industry.

    To find the smaller contractors that typically offer lower prices, you’ll need to use an installer network like EnergySage. You can receive free quotes from vetted installers local to you when you register your property on our Solar Marketplace – homeowners who get 3 or more quotes can expect to save $5,000 to $10,000 on their solar panel installation.

  2. The biggest installers typically don’t offer the best price

    The bigger isn’t always better mantra is one of the main reasons we strongly encourage homeowners to consider all of their solar options, not just the brands large enough to pay for the most advertising. A recent report by the U.S. government found that large installers are $2,000 to $5,000 more expensive than small solar companies. If you have offers from some of the big installers in solar, make sure you compare those bids with quotes from local installers to ensure you don’t overpay for solar.

  3. Comparing all your equipment options is just as important

    National-scale installers don’t just offer higher prices – they also tend to have fewer solar equipment options, which can have a significant impact on your system’s electricity production. By collecting a diverse array of solar bids, you can compare costs and savings based on the different equipment packages available to you.

    There are multiple variables to consider when seeking out the best solar panels on the market. While certain panels will have higher efficiency ratings than others, investing in top-of-the-line solar equipment doesn’t always result in higher savings. The only way to find the “sweet spot” for your property is to evaluate quotes with varying equipment and financing offers.

For any homeowner in the early stage of shopping for solar that would just like a ballpark estimate for an installation, try our Solar Calculator that offers up front cost and long term savings estimates based on your location and roof type. For those looking to get quotes from local contractors today, check out our quote comparison platform.


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