Solar Panel System Cost & Pricing Guide
We understand that going solar is an important decision. We aim to empower you with home solar cost information to help you understand your project.
Costs of a Home Solar System: A Few Things To Consider
There are 3 ways to acquire solar: Cash, finance and PPA (power purchase agreement)
What determines the pricing of all three options requires a lot of data, such as:
- Annual sunlight exposure
- Roof orientation and roof pitch
- Your average electric usage
- Where you are located
- When solar agreements are signed (due to decreasing state incentives)
- Program and tax credit eligibility
Costs vary significantly by region. Solar will be more costly in areas with higher utility costs.
So if you are a reader of this article and live in a region other than NY, NJ, CT and CA, this article will provide you valuable insight and information but the pricing estimates here will be significantly different for you.
Price Per Watt (PPW)
When considering the pricing of solar installations, many consumers focus on the price per watt (PPW) as a key metric. However, it’s important to note that unlike most construction projects where smaller projects tend to have lower costs per unit, solar installations often follow the opposite trend.
There are many nuances that can influence the PPW, such as the number of roof planes and arrays receiving solar, the routing of conduit, the presence of trenching or meter taps, and the use of island and loner mods. Generally, the more complex the installation regardless of size, the higher the cost per watt.
As a consumer, it’s essential not to overly fixate on PPW. However, if an installer is pricing a job significantly higher than $5.00/watt in any of the CT, NY, NJ states, it may be worth questioning their pricing. Conversely, if the PPW is lower than $3.50/watt, this should raise some red flags as well.
Like anything else, keep in mind that you can find cheaper options, just buyer beware.
What you sacrifice in costs upfront, you make up for in headaches, lack of, or zero communication post sale and lots of costly service calls down the road.
To guarantee that our customers benefit from immediate customer support throughout their entire tenure with us, backed by comprehensive parts and service warranties, we prioritize quality over cost. This commitment to unparalleled service is highly valued by our customers and addresses a significant gap within the industry.
As the saying goes, you often get what you pay for.
In solar, you only get one shot at this, so it’s crucial to ensure the job is done right the first time and that you have continued support.
Pricing Solar for Cash, Finance and PPA
The following pricing examples and estimates are assuming we are dealing with a home that uses 10,000 Kwh per year.
Cash Example:
Buying a solar system upfront (cash) can range from $20,000 to $100,000, coming in at around $40,000 – $44,000 for an average home using 10,000 kwh of electricity per year in the tri-state region (NY, NJ, CT).
Costs vary based on sunlight conditions:
- Less than ideal (e.g., shaded roofs): 26-30 panel system = $45,000 – $50,000 before incentives / $25,000 – $30,000 after incentives*
- Ideal (average sunlight and shade): 23-25 panel system = $40,000 – $44,000 before incentives / $20,000 – $25,000 after incentives*
- Excellent (little shade, optimal orientation): 20-22 panel system $35,000 – $39,000 before incentives / $18,000 – $20,000 after incentives*
The average break even point in the tri-state region (NY, NJ, CT) is 7-9 years with electric rates rising about 6-8% annually.
If you find yourself in the higher end of the price range, don’t fret, it will still make sense financially and be much more of a cost effective option than traditional utility. Please read our blog here that explains how purchasing a solar system cash can be one of the best investments for your home. I also explain break even periods and return on investment (ROI)
*Please note that the total cost of your solar installation may vary depending on when you authorize your utility interconnection documents. State incentives for solar are time-sensitive and are subject to change, with incentives consistently decreasing over time. We recommend consulting with a solar expert to understand the current incentive landscape and maximize your potential savings.
Finance Example:
Although financing solar was once popular due to low interest rates, the landscape has changed. Initial monthly payments may seem higher, but they remain fixed while electricity rates rise annually. For an average 10,000 kwh usage home:
Costs vary based on sunlight conditions:
- Less than ideal (e.g., shaded roofs): 26-30 panel system = Approx $200/mo solar payment after incentives*
- Ideal (average sunlight and shade): 23-25 panel system = Approx $160/mo solar payment after incentives*
- Excellent (little shade, optimal orientation): 20-22 panel system = Approx $130/mo solar payment after incentives*
If you find yourself in the higher end of the price range, don’t fret, it will still make sense financially and be much more of a cost effective option than traditional utility. Please read our blog here that explains why having an upside down monthly solar payment may still be financially beneficial.
*Please note that the monthly finance payment may vary depending on when you authorize your utility interconnection documents. State incentives for solar are time-sensitive and are subject to change, with incentives consistently decreasing over time. We recommend consulting with a solar expert to understand the current incentive landscape and maximize your potential savings.
PPA (Power Purchase Agreement) Example:
PPA offers simplicity and more immediate savings, with homeowners purchasing solar power at a lower cost than utility power:
Costs vary based on sunlight conditions:
- Less than ideal (e.g., shaded roofs): 26-30 panel system = Approx $135/mo solar payment after incentives*
- Ideal (average sunlight and shade): 23-25 panel system = Approx $120/mo solar payment after incentives*
- Excellent (little shade, optimal orientation): 20-22 panel system = Approx $105/mo solar payment after incentives*
*Please note that the monthly PPA payment may vary depending on when you authorize your utility interconnection documents. State incentives for solar are time-sensitive and are subject to change, with incentives consistently decreasing over time. We recommend consulting with a solar expert to understand the current incentive landscape and maximize
Cash Pricing Examples For A Small To Large Size Solar Array
| Average Electric Bill | Solar System Size | Cost Before Incentives | Federal Tax Credit | Cost After Tax Credit | 25 Year Savings (factoring in state incentives) |
|---|---|---|---|---|---|
| $75 | 5 kW | $24,690 | $7,407 | $17,283 | $39,691 |
| $150 | 10 kW | $44,290 | $13,287 | $31,003 | $69,659 |
| $300 | 18 kW | $72,490 | $21,747 | $50,743 | $153,408 |
It’s important to note that these figures represent the average costs of installing a solar system on your roof
Years in the solar industry and historical data shows that 10,000 kwh is the average amount of electricity a home in the northeast region uses on an annual basis.
Also, for the sake of this pricing guide, I based pricing examples as if we are pricing Tier 1 panels and microinverters over string inverters with installation included. Separate article on inverters and solar panel types coming soon. If you have questions about any one of these now, please call 201-304-7917 and ask for our operations manager Brian.
Homeowners see a bit more instant savings with the PPA program. It is for that reason it is becoming the most popular way to get solar today.
Keep in mind that with a PPA, the cost of the power produced does increase just like it does with your utility provider except the major difference is you enter into an agreement with the solar provider that your rate will never exceed a certain percentage annually. This is called an annual escalator.
The industry standard annual escalator for a PPA is 2.9%. Contrast that to utility rates increasing conservatively 5 – 6% annually, this is a bargain.
In the areas that we tend to service, our customers’ utility providers like PSE&G, JCP&L, Rockland Electric and Con Edison have annual rate increases on average of 6-10% per year now with the current grid investment mandates. So the savings homeowners achieve with these high utility rate increases are substantial, amounting to tens of thousands of dollars over time.
Related articles:
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Guarantees & Warranties
We stand behind our exemplary services with these guarantees:
Personalized Support
Each client of Cleanstart will be assigned their very own dedicated client support rep that will be able to support you in your tenure with Cleanstart. You are not a ticket number here.
Lifetime Support
As long as you are a client of Cleanstart, you get lifetime support.
Fully Covered Parts
We use tier 1 premium equipment on your home with 25 year warranty on all parts and components. This ensures your solar powered home is operating safely and efficiently for many years.
Fully Covered Labor
Dedicated maintenance and labor for 25 years.
System Monitoring
Our team, as well as you, can monitor your consumption, impact, and system health reports via the Enphase App.
Our Process
We believe in getting to know our customers and closely evaluating each property we work on. When a new customer contacts us, we always start by scheduling a virtual consultation. After the initial contact, the process looks like this: