Cost of Solar Panel Systems

If you are a do-it-yourselfer who wants to install the solar system on your house yourself, or with the help of an electrician, you can buy a solar system that is already designed to work together. Since it is tricky to get a one-size-fits-all kit, you may need to customize the system to fit your needs. But these grid-tied solar power systems are a great starting point. Let’s look at the system that fits the needs of the Colorado system we just calculated. We need a 5,400W grid-tied solar system.

This system uses microinverters, where each solar panel has its own small inverter mounted on the rack right behind it. So instead of bringing the DC power from your panels into one inverter by your breaker box, you bring AC power directly to the breaker box from the 18 microinverters.

So, what does going solar cost?

This example system currently costs $9250. The good news is that Colorado Springs has a solar rebate that is worth $0.25 per watt. So we get 5,400W x $0.25 = $1,350 back, bringing it down to $7,900. But wait, there’s more! We also get a 30% federal tax credit off the installed price of the system, which gives us $2,370 back next tax day. That’s now down to $5,530. That’s $1.02 a watt for solar! If you are paying $0.15 per kWh for solar from the grid, and are replacing 750kWh a month, that is $112 a month savings. So it will take 48 months, or just under 4 years for payback. Not a bad turn on investment, I’d say.

If you are not comfortable doing the installation yourself, you’ll want to have the solar system professionally installed. Depending on your location and the equipment used, the going rate is about $3.50 – $4 per watt installed in the US. So that 5,400W system would cost about $19,000. The rebates and tax credits would apply to that cost, so your system could end up at about $19,000 installed, or $2.22 per watt. The payback for that is under 9 years.

To see how your state ranks as a “solar friendly” state compared to others, see Solar Power Rocks’ annual ranking of the best and worst states for home solar power.

Off-grid Solar Cost

Off-grid solar can be more complicated and more expensive than grid-tied solar. Because you are stand-alone, without the grid to provide any additional power you may need, you have to design the system to make all of your electricity. You also need to store it so you can use it when you need it, not just when you make it.

So in addition to the equipment needed for grid-tied solar, you also need a battery bank and a charge controller to manage the power going into the batteries. We’ll cover how much it costs to go off-grid solar in another blog. Meanwhile, you can check out our off-grid calculator to give you an idea of what components you’ll need a solar power system and our off-grid home solar power systems to see some great examples.

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