There’s a lot that goes into the cost of solar panels. The size of the system, the type of cells, the efficiency, and the warranty all play a role in the price. Let’s look at them in greater detail:
System Size
Maybe the most obvious factor, the size of your system will have the biggest impact on price. A larger system will cost more than a smaller one. This is because you’ll need more panels, more racking and wiring, and more labor to install it.
Remember, solar is an upfront investment. But, it will save you money on your electric bills over the long run. The larger your system, the more you’ll save.
Type of Cells
Solar panels are made with either mono-crystalline or polycrystalline cells. Monocrystalline cells are made from a single crystal of silicon. They’re more efficient than polycrystalline cells, but they’re also more expensive.
Polycrystalline cells are made from many smaller crystals of silicon. They’re not quite as efficient as monocrystalline cells, but they’re cheaper to produce.
Efficiency
Solar panel efficiency is an important metric for determining the effectiveness of a solar panel. It is measured by the amount of sunlight that hits the panel that is converted into electricity.
The average efficiency of solar panels on the market today is between 15% and 20%. However, some panels can convert more than 30% of sunlight into electricity.
The most efficient panels are made from materials such as silicon and gallium arsenide. However, these materials are also the most expensive.
As a result, most solar panels on the market today are made from cheaper materials such as polycrystalline silicon.
Warranty
Solar panels are a long-term investment, and most manufacturers offer a warranty to cover defects in materials and workmanship. The standard warranty is usually 10 to 25 years, but some companies offer warranties of up to 30 years.
This coverage can give you peace of mind that your investment will be protected in the event of a problem. In addition, many manufacturers offer performance guarantees.
These guarantees typically cover the output of the panel, and they vary from 5 to 20 years. Performance guarantees can provide reassurance that your panels will continue to produce electricity as expected.
Location
The cost of solar panels also depends on where you live. States with high electric rates and good solar incentives will have the lowest costs. States with low electric rates and weak solar incentives will have the highest costs.
For example, California has some of the highest electric rates in the country. But, it also has strong
Panel Brand and Quality
As with any product, there are different levels of quality when it comes to solar panels. Higher-quality panels will cost more, but they’ll also be more efficient and have a longer lifespan.
Roof Characteristics
The condition and orientation of your roof will also impact the cost of solar panels. If your roof needs to be replaced, that will add to the cost. If your roof isn’t well-suited for solar (e.g., it’s too shaded), that could also increase the price.
Labor Costs
Finally, the cost of labor will also play a role in the price of solar panels. If you live in an area with high labor costs, that will add to the price.
Permitting and Interconnection Fees
Some fees are specific to solar. Permitting and interconnection fees can vary depending on where you live, but they typically range from $500 to $1,000.
Solar Incentives
The good news is that several solar incentives can help offset the cost of solar panels. The most common is the solar tax credit, which allows you to deduct 26% of the cost of your system from your federal taxes.
Several state and local incentives can further reduce the cost. To learn more about solar incentives in your area, check out our Solar Energy Incentives page.