Your Guide: Typical Costs Associated with Solar Panel Installation

August 13, 2022

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A solar panel installation is an excellent investment for any property owner! Solar means clean, green energy that’s produced without fumes or pollutants. Additionally, solar panels help to lower your utility costs year-round. Moreover, solar panels often increase property values while creating jobs and stimulating your local economy!

However, while financial incentives mean lower costs overall, a solar panel installation is rarely free! In turn, property owners often wonder about typical costs associated with solar panel installations. First, remember that every solar array is different, and its costs vary accordingly. Second, a solar panel installer near you is the best information source when it comes to solar on your property!

The average cost of solar panel installation

According to Forbes Magazine, solar panel installations might cost anywhere from $3500 to $35,000. The average installation cost usually runs around $16,000. However, this price doesn’t always take into account financial incentives that can lower those costs significantly.

For instance, the Inflation Reduction Act allows property owners a 30% tax credit for solar panel installation until 2033. In other words, you can claim 30% of your installation costs on your tax returns, lowering your overall tax bill. So, a property owner could claim a $4800 tax credit on their $16,000 system, as an example.

average cost of solar panel installation

The Inflation Reduction Act then provides a 26% credit for 2033 and 22% in 2034. Of course, there is no telling what other credits and incentives the federal government might consider between now and then! Also, remember to check with an accountant or solar installer about these credits before filling out your taxes. One reason is that it’s vital that you understand all requirements for these credits to ensure an accurate tax return. Two, you don’t want to miss out on any credits either!

Additionally, remember that these are just federal credits. Each state and local municipality decide their own incentives if any. For example, some states might waive taxes on increased property values from installing solar. Whatever the case, your solar installer can typically alert you to all incentives for which you’re eligible!

How long does it take for solar panels to pay for themselves?

Homeowners might break even on their solar panel installations after 8-10 years or slightly longer. Consider one example of how this might work for a homeowner:

  • Start with $16,000 on a solar installation, minus $4,800 in tax credits.
  • Consequently, those panels cost $11,200 in total.
  • If those panels save $100 in electric costs every month, that’s $1200 per year.
  • At $1,200 per year, it takes 9 years and 4 months to save $11,200 then.

Of course, these numbers vary according to the solar panel system you choose. For instance, high-quality panels might save you even more money on your electric costs every year. Also, lots of sun exposure means more solar energy from those panels! Consequently, when you break even on your panels depends on area weather conditions, your initial investment, and other such factors.

Is solar panel installation worth the cost?

There are many reasons to consider a solar panel installation for your property! Note a few of those reasons here so you can decide on a solar array for your home or business:

  • Most solar panel owners can expect to save $2,000 or more on energy costs over the life of those panels. This is after they’ve broken even and earned back their installation costs! Imagine what you can do with that $2,000 other than pay it to your local power company.
  • Solar panel installation usually raised property values by 2% to 4% on average. Also, many states waive property tax on that increased value. In turn, you can build equity faster and sell your property for more money with a solar system installation.
  • Solar power and your panels don’t rely on supply chains to operate. Consider how transportation strikes, tariffs, and other issues can affect the delivery of coal, propane, and similar energy sources. Not so with solar power!
  • Using solar means not having to worry about skyrocketing energy costs. Also, you can upgrade electronics or appliances and not have to face higher energy costs.
  • Solar panel installation and recycling are both labor-intensive jobs. Consequently, investing in solar means creating those jobs and helping to stimulate your local economy.

Of course, most consumers choose solar in order to reduce pollutants for which they’re responsible. Also, investing in solar for your property can encourage your neighbors to do the same!

house with brand new solar installation

Are there any disadvantages to a solar panel installation?

For most consumers, the biggest disadvantage to solar installation is its upfront cost. However, solar panels are more affordable than ever before. Also, financial incentives, including tax credits, help lower that cost even more. Additionally, many consumers find that solar panel benefits, including long-term savings, make them worth the investment!

Next, consider that a solar panel racking system typically needs removing before contractors can perform roof repairs. This might add a few hundred dollars to your repair or reroofing costs. On the other hand, solar panels typically protect shingles and tiles from premature damage! In turn, that small added cost is offset by the roof protection offered by your solar panels.

Effectiveness of solar panels

Solar panels work by absorbing sunlight and then converting the sun’s rays into usable electricity. Consequently, they require sun exposure to work effectively. In turn, those panels aren’t necessarily creating power at night, during overcast days, and so on.

However, this doesn’t mean that solar isn’t a good investment for property owners living anywhere but the tropics! Even a small amount of sun exposure means usable energy. Also, a quality contractor installs panels at an angle, with sun exposure in mind. Additionally, they might recommend trimming overhanging tree branches and addressing other obstructions. This ensures maximum effectiveness and power produced by those panels.

Go Solar Energy Texas is happy to offer this information about solar panel installations to our readers. We hope you found it helpful! If you’re ready to go solar, call our Texas solar panel contractors. We offer FREE consultations and expert advice. For more information, just give us a call.

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