How much does solar cost?

Discussion in 'Frequently Asked Questions' started by scott, Jan 2, 2015.

  1. scott

    scott Administrator Staff Member

    This is a difficult question to answer in the abstract as there are many factors that influence the cost of solar. There are local utility rebates and government incentives available depending on where you live, so your location is one major factor in determining the cost. Particulars of your physical installation will also influence the cost. For example, a system on a three story, tile roof house will be more expensive then the same system on a single story, simple roof or a ground mounted scenario. For these reasons, the estimates listed here are only very rough ideas to get you started. For more exact information, make a post in our GOING SOLAR section of the forums where other users in your area can respond, or simply send us an email from our CONTACT US page.

    Purchase outright.
    Grid-connected (no batteries) PV system. To purchase a flush roof mount, grid-connected (no batteries) PV system will likely cost between $3.50 and $4.50 per watt before incentives. So a 6kW system may cost $21k to $27k, installed. Some companies charge more (or even less) then these amounts depending on your location.

    Incentives. Through 2016 there is a 30% Federal Income Tax Credit which will be credited towards your income taxes effectively reducing the system cost. There may also be additional rebates and incentives available from your local utility and local municipalities. is a great source for researching other incentives in your area.

    Batteries. The above example if for a grid-connected system that does not use batteries. Batteries can be added for additional costs, but this cost will vary drastically depending on many factors. A simple backup system could start at $3k additional cost and range up to $20k (or more). It all depends on how much energy you use and how much you want available if the power goes out. With some additional information we can give you a much better idea. CONTACT US and we can give you a better idea.

    Solar Thermal. Again, the answer is "it depends". The cost can really vary depending on what you would like to do, where you live, and the particulars of your physical location. Generally speaking a system that offsets your Domestic Hot Water heating load may cost about $8k to $10k. Adding space heating can add 30% (or more). A system that uses the sun to heat air (Hot Air Collectors) might cost around $2500 installed depending on the capacity.

    Solar Loans
    If you are not in a position to purchase the system outright, then a loan may make since. Often Home Equity Line of Credits (HELOC) from your existing credit union can provide some of the lowest rates. In addition, many solar specific loans are becoming available that offer interesting features such as long 20 year terms, 30/70% loans that take advantage of the 30% federal ITC, as well as other features. Check out THIS THREAD for a list of solar loan providers.

    Power Purchase Agreement (PPA) / Solar Lease
    If possible, purchasing the system outright or even utilizing a loan will generally provide the best Return on Investment (ROI) for a solar power system. In some cases you may be interested in solar, but these other options are not viable for one reason or another. Most PPA's and Leases rely on utility and government incentives to "make since". In areas with decent incentives we see these leases often about $10-$20 a month less then what you currently pay to your utility. If you pay $150/mo in utility bills, a solar lease may cost $130/mo. When considering one of these finance options, pay special attention to required deposits or escalators which increase the payment over the term of the lease which is often 20 years. If you are considering a lease or PPA, we highly recommend asking the installer for a copy of the contract. Post the contract in our FORUMS where other users can provide feedback before you sign.

    Generally speaking, leases and PPA's are only available for grid-connected systems. It is much more rare to find one for batteries or thermal systems.

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