How Much Do Solar Panels Cost | Comprehensive Information About Your Solar Power System

Although solar panels can significantly reduce your electricity bills by transforming solar energy into electrical energy, they still need an amount of upfront cost. Before making a purchase, many people want to know how much solar panels cost, in how many years can the solar panels pay for themselves, and continue to provide savings for decades after that. In this article, we will explore the average solar panel costs in 2023, the cost of different types of solar panels, some factors affecting the price, information about installation, and possible financing options for solar panels. Find all the things you need to know with our blog before making your purchase.

Average Solar Panel Costs in 2023

The cost of a solar panel is typically measured in dollars per watt. In 2023, the average cost of solar panels in the United States is around $2.50 to $3.50 per watt. Most people choose to install a typical residential system, which is around 6 kilowatts (kW), meaning that the total cost of it is 15,000 to 21,000 before tax incentives and rebates. It’s also noteworthy that, in 2023, the government provides a 30% of Federal Solar Tax Credit for your total solar panel system costs, meaning that you can subtract the 30% price calculated to get an approximate cost of your solar panels.

Cost of Different Types of Solar Panels

Monocrystalline solar panels, polycrystalline solar panels, and thin-film solar panels are the three most common types on the market today. However, the cost of each type can vary based on different construction materials, manufacturing processes, and conversion efficiency. Here are the approximate costs of these three types of solar panels:

Monocrystalline Solar Panels

The average cost of monocrystalline solar panels ranges from $1.00 to $1.50 per watt. Made with solar cells that are constructed from a single crystal of nearly pure silicon, monocrystalline solar panels have a better performance than polycrystalline solar panels and can generate four times the electricity of film solar panels under the same lighting conditions, making them the most popular and expensive type in the marketplace. Average monocrystalline solar panels have a 15-20% conversion efficiency. Our Anker 531 Solar Panel is a prime example of a monocrystalline solar panel due to its superior energy conversion efficiency rate of up to 23%, this means that it's able to produce more power compared to other types of solar panels. Furthermore, it offers 3-mode angle adjustments that allow you to choose between 40°, 50°, or 60°angles to achieve optimal solar power based on your geographical location and specific solar needs. Its adjustable kickstand ensures that you can position the panel at the best possible angle, thereby maximizing the output of solar energy.

Polycrystalline Solar Panels

The cost of polycrystalline solar panels ranges from $0.90 to $1.00 per watt. Polycrystalline solar panels have cells that are made from multiple silicon crystals and with a much easier and less error-prone manufacturing process. Therefore, polycrystalline solar panels are cheaper. However, they are also slightly less efficient than monocrystalline panels. If you want to generate an equivalent amount of power as monocrystalline generates, you need larger polycrystalline solar panels, and it takes up more space in your home.

Thin-Film Solar Panels

The cost of thin-film panels typically ranges from $1 to $1.50 per watt. Thin-film panels are lightweight and are commonly used in large-scale power plants. However, they generally have lower efficiency compared to crystalline panels. Thin-film panels are not as commonly used in residential applications.

Factors Affecting Solar Panel Cost

Remember that several factors can affect solar panel costs, and It's important to do your research, get multiple quotes, and take crucial factors into consideration before making a decision to install solar panels. Here are some of the main factors to consider:

Type of panels: Given the different raw materials and manufacturing processes of solar panels, they vary in type, efficiency, durability, and cost. Higher efficiency panels like Monocrystalline solar panels can be more expensive. Polycrystalline Solar Panels or thin-film with lower efficiency can be more affordable.

Size of solar panels: The size of the solar panel system can impact its cost. A larger solar panel can provide more electricity compared to a small one, but they are generally more expensive.

Installation cost: The cost of installation includes various components such as engineering site visits, permits and documents, ordering equipment, actual installation, and approval and interconnection processes. The overall installation cost can vary based on the complexity of the installation, location, and labor expenses. Factors like system size, location, and equipment type can affect the overall installation costs.

Incentives and rebates: Incentives and rebates offered by governments, utility companies, or other entities can significantly impact the cost of solar panels. These incentives aim to encourage the adoption of solar energy and can help reduce the upfront costs. Examples include federal solar tax credits, state-level incentives, and utility-specific programs.

How to install Solar Panels?

Solar panel installation can be a complex process that involves several steps, and it is usually done by professional installers. Here are the basic steps involved in installing solar panels:

Site Assessment: The first step is to assess the site where the solar panels will be installed. The installer will evaluate the amount of sunlight on the intended installing site, the orientation and the angle, and any potential shadow that may impact the function of the solar panels.

Designing: Once the site has been assessed, the installers start to design the solar panel system. During this process, they will determine the size of your solar panel, the number of panels needed, and the wiring.

Permitting and inspecting: The installation of solar panels requires electrical and construction work, which may cause safety concerns. Therefore, the local government and solar panel company need to go through some formalities of permitting and inspecting, in order to ensure both your solar energy equipment and installation plan meet safety standards.

Installation: The installation typically involves the following steps:

1. Mounting: Install the racking system or mounting brackets on the roof or appropriate location. Ensure secure attachment and proper alignment for optimal sunlight exposure.
2. Wiring: Connect the solar panels with electrical wiring, ensuring proper connections and adherence to electrical codes and safety standards.
3. Inverter connection: Connect the solar panels to the inverter, which converts the DC electricity generated by the panels into usable AC electricity for your home.
4. Grid connection: If you intend to sell excess electricity back to the grid, consult with your utility company and follow the necessary procedures for grid connection.
5. System testing: Once fully finished with the installation of the solar panels, the installers will test your solar panel system. They will check the voltage and current output and monitor the system's performance to ensure it works properly and generates the expected amount of power.

Maintenance and monitoring: Regularly inspect and clean the solar panels to maximize their efficiency. Follow manufacturer guidelines for maintenance and consider professional maintenance services as needed. Monitor the system's performance and energy production to identify any potential issues.

Solar Panel Installation Costs

According to the information obtained from EnergySage, the cost of solar panel installation in the United States has significantly decreased over the past decade. The average price of solar panels is now around $20,650, compared to $50,000 ten years ago. After factoring in the federal solar tax credit, the cost range for installation is between $17,430 and $23,870, with an average cost of $20,650. Several factors influence the cost, including system size, location, panel brand and quality, roof characteristics, labor rates, and permitting fees.

In addition to the initial installation costs, there are other considerations. Roof characteristics, like pitch, can impact installation complexity and cost. Monitoring costs, tree trimming expenses (ranging from $250 to $700), roof repair costs (ranging from $150 to $7,000), and solar panel repair costs (ranging from $300 to $1,300) should be taken into account. Winter is considered an optimal time for installation as it can lower costs. One of the significant reasons is that winter is considered an off-season for many industries, including installation services. During this period, companies usually have less work to handle, allowing them to offer more competitive pricing and discounts to their customers. This results in significant cost savings for those who choose to undertake their installation projects during this time.

Financing Options for Solar Panels

Solar panel systems can be purchased outright or financed through loans or leases. The government also offers incentives for solar panel systems. Here are some of the most common financing options that can help make solar panel installation more affordable and accessible.

Solar Loans: Many banks offer solar loans that can be used to finance the cost of solar panel installation. These loans typically have interest rates that are lower than credit cards, and the payments can be spread out over several years.

Solar Leases: A solar lease is a financing option that allows homeowners to rent solar panels from a solar company. Under a solar lease, the homeowner pays a fixed monthly fee to the solar company for the use of the panels, and the solar company is responsible for maintenance and repairs. However, in this case, the tax incentives and rebates go to the solar panel company.

Power Purchase Agreements (PPAs): A PPA is a financing option that requires no up-front costs.  PPAs allow the solar panel company to make installations on a homeowner's property and sell the electricity generated back to the homeowner at a fixed rate. This option typically requires little or no upfront cost to the homeowner.

Government Incentives: The federal government offers a tax credit for solar panel installation equal to 30% of the total costs. This tax credit applies to both residential and commercial installations and can be claimed in the year that the system is installed.

State and Local Incentives: Many states and local governments offer additional incentives for solar panel installation, such as rebates, tax credits, and performance-based incentives. These incentives vary, and you need to inquire about them according to your location.

Conclusion

Solar panel is sure to be a promising investment and most solar panel owners said that installing solar panels was worth it. Make use of our article in calculating the costs and designing your solar panel before purchasing, and choose the most suitable one for you. Also, remember to consult the local incentives and rebates policy and make use of it them.