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How Much Does it Cost to Install a Solar Panel?

Installing a solar panel is a great way to invest in the health of our environment. The cost to install solar panels may seem intimidating, but in reality the installation cost of a solar panel system is now more affordable than ever before.
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According to, 97% of Americans overestimate the cost of solar panels and the cost to install a solar panel. This fact means an accurate estimate of the cost to install a solar panel is very important. In order to determine the solar panel installation cost, several facts must be considered.

What to Consider in Estimating Cost

- Is your home/office/business off-grid or on-grid?
- Do you want your gross energy consumption to be provided partially or completely by photovoltaics and a solar panel system?
- What is the size of your home/office/business and how much power do you consume monthly on average?

Solar Panel Installation CostWith this data, an accurate solar panel installation cost can be calculated. Our solar calculator tool can make this calculation quick and easy!

An off-grid home will require additional installation costs for storage batteries. An on-grid location will have a lower cost to install. A location partially powered with solar energy will have an installation cost that is much lower than the cost to install a completely solar powered location. Additionally, a smaller location will have a lower cost for solar panel installation than a large location. This data will be used to calculate the relative installation costs for a solar panel system.

Average Installation Cost

After calculating a relative installation cost, an overall installation cost can be determined. To determine this overall cost to install solar panels, the various installation costs can be broken down into parts. According to, the average cost to install solar panels in a typical residence are broken down into the following amounts. (However, the cost to install solar panels can vary widely).

- Initial average installation cost: $25,000
Note: This cost is often offset by solar incentives. It can be paid as a lump sum or a payment plan can be implemented depending on local, state and power company regulations.
- Federal incentive: -$6000
- State incentive (average): -$2500
- Local incentive (average): -$2500
- Total installation cost: $14,000 (This cost will cover the necessary equipment and labor)

Costs to install solar panels are gradually decreasing and many incentives provide strong motivation to take advantage of lowered installation costs as soon as possible. The cost to install a solar panel system will be regained from energy savings in a number of years.

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Written by: Christian Märtel, Editor