The Average Cost for Solar Panels in 2023

What Is Solar Energy?

Solar is energy that comes from the sun. It is one of the most plentiful resources available today and is very underused. Solar panels can capture that energy, transforming it into a usable source of electricity that can power everything from your TV to your home's heating and cooling system. Though solar panel systems have been available for some time, they haven’t always been accessible due to their typically higher costs – however, that’s changing.

How Much Do Solar Panels Cost?

Solar panel costs range widely depending on the size of the home, location, and overall panel selection. Most often, the average cost ranges from $3,500 to $35,000, with an average cost for a residential property of $16,000.

This price may be beneficial to know, but it doesn’t provide enough details about what goes into purchasing and installing solar panels. Various other factors determine what you will ultimately pay for solar panels.

The Type of Solar Panels

One of the biggest factors impacting the overall cost of solar panels is the type of panel installed. Solar panel costs can depend on the overall materials used in the solar energy system. Here's a look at some of the most common options and the associated solar panel cost.

Monocrystalline solar panels

According to EcoWatch, monocrystalline solar panels are one of the most popular options used. They are made out of a single silicon crystal. Each of the cells on the solar panel is often called a mono solar panel. This type of panel typically costs from $1 to $1.50 per watt of power, providing an average solar panel cost of $6,000 up to $9,000. That said, the industry is seeing significant volumes of polysilicon manufacturing come online, which may lead to decreases in pricing starting in 2023. 

Polycrystalline solar panels

A second popular type is polycrystalline solar panels, also known as polysilicon. They have multiple silicon crystal fragments. Each of these individual fragments is linked to each other during the manufacturing process. This type of solar panel system is a bit less energy efficient than monocrystalline solar panels. They cost a bit less too, at around $.90 to $1 per watt or $5,400 to $6,000 overall. 

Thin film solar panels

A third option is called a thin film solar panel. They are more affordable overall, but they do take up more space on a rooftop or near the property. That is why they are often used in factories and other larger commercial operations. The solar panel cost here is between $1 and $1.50 per watt, with average costs ranging from $6,000 to $9,000.

When considering the cost of solar panels, the actual dollar amount to purchase the panels is typically only one factor of the whole price. There is also the need to pay for professional solar installation in most cases and other concerns.

Solar Panel Installation Costs

When considering costs, solar panel installer pricing can range widely by location as well as by the overall experience of the team and their abilities. Most solar companies are upfront about what goes into the solar panel cost in terms of installation.

Most of the time, you can expect installing solar panels to cost $15,000 to $25,000. Locations that are more remote may cost more, while in other areas, like California, costs are much lower. The key here is to determine the number of necessary solar panels, which can also impact solar costs.

Other Factors That Impact Solar Panel Installation Costs

Solar panel costs range widely beyond just the price of buying a solar panel. Installing solar panels may also range widely based on factors such as the following:

Size and number of panels needed

Though solar panel costs are often dependent on the number of solar panels, some are more efficient than others, costing a bit more but providing a higher level of functionality. The number of solar panels needed depends on the energy the home needs. A good way to determine this is to look at your electric bill to determine how many watts of power you are using now.

Solar companies

The cost of solar panels also depends on the solar panel company you select. Some are more affordable than others, and some have several add-on costs to the solar panel installation process that can drive up the cost.

Solar investment tax credit and incentives

If you are a homeowner, 2023 is a great time to begin looking into solar incentives. The United States has extended the Investment Tax Credit for Solar and is continuing with a 30% credit through 2032. A tax credit is a one-for-one dollar amount reduction from income tax that you would have paid without the credit. For example, if your installation costs $20,000, and you claim your Solar Investment Tax Credit (ITC) at 30%, you will owe $6,000 less in income tax for the year, decreasing the total cost of your system to $14,000. 

‍The Inflation Reduction Act states that the Investment Tax Credit for Solar will decrease to 26% in 2033 and 22% in 2034. The more customers begin to take advantage of these cost savings over the next ten years, the more difficult it will be for you to take advantage of them. Rather than get stuck waiting for months, or even years, to complete your solar installation, get started now!

Finding the Best Solution for Your Solar Panel Installation Needs

If you are thinking about adding a solar system to your home, start with the SmartSolar.org quiz, an easy way to learn more about how well solar power can work for your home. If you want to eliminate or lower your electricity bill and use renewable energy, and perhaps even have solar panels generate enough power to sell excess solar to the grid, let our team help you. Contact SmartSolar.org to learn more about how we can support your needs.