Solar power system prices have reached the point that the average homeowner can now consider it a viable option for their energy needs.
The systems are smaller, lighter, smarter and more powerful than they were at the beginning of the solar power movement.
How Solar Works?
Solar power comes from our ability to harness the energy of the sun with photovoltaic cells. Each solar panel is made up of dozens of these cells, and each residential solar array needs an average of 30 panels to cover 100% of an average household’s energy needs.
The arrays send direct current (DC) electrical power to inverters that change it to alternating current (AC) to power your home.
Why Use Solar?
Solar energy is a renewable energy source that operates independent of local infrastructure. Users of solar systems enjoy less expensive energy – or free energy once the system is paid off.
Their power will remain even when the area around them is suffering a power outage. Also, solar systems are an upgrade that increases the value of your home.
Others choose solar for a more altruistic reason – climate. They feel that solar energy is a clean fuel that doesn’t harm the environment and they want to help heal the world.
Whatever your reasons, solar energy is an economical and dependable choice for powering your home.
Laws and Regulations
Installing a solar array is a lengthy, multi-tiered endeavor. Each state and locality have written their own rules and regulations that you must follow.
You will need to research your local guidelines on residential solar arrays or talk to a reputable local installer (preferably both) to make sure your plans follow your local laws.
Some localities will not allow you to pull completely off the grid while others will insist that you share your energy for the exchange of energy credits. Others insist that you have an instant shut-off capability in case first responders need to access your roof.
You will also need to know your local building codes for installing a solar array on your roof. These rules and regulations run from the state level all the way through to county, city and even HOA agreements.
Types of Solar Systems
Solar systems come in three basic types: Grid tied, hybrid and off-grid. We will explore each type and their individual qualities to help you decide which system is right for you.
The most popular setup in the United States is the grid-tied system, which means your home remains connected to your local energy grid. This allows you to pull from the grid when necessary but also to export energy to the grid in exchange for energy credits towards your monthly bill.
- Least expensive system
- No power interruptions at night
- No expensive battery systems
- Reliant upon grid at night
- Exposed to local power outages
- Importing power during low sunlight (think winter)
A hybrid solar system remains connected to the local grid but also uses a battery for energy storage.
This allows you to mostly export power to the grid and use your own power during the night and low sunlight situations such as storms. You will also be able to wait out lengthy local power outages with your battery backup without your home losing power during the night.
- Sustained power in all conditions
- Larger energy credits
- Battery backup provides energy security
- More expensive
- More difficult installation
- Long power outages can drain your batteries
Just as the name implies, with an off-grid system your home is completely detached from your local power grid. Large battery arrays will keep you going through the night and in low sunlight conditions.
These systems are most useful for homes located in the Sunbelt and for those in remote locations where running power lines is not an alternative.
- Total power independence
- No energy bills
- Brings energy when no other means exists
- Most expensive system
- Larger arrays to ensure energy production
- If batteries drain completely your power is gone until the sunlight returns
Choose your system only after considering all the factors in your budget, local grid conditions, and locality. Make sure that you are comfortable with the limitations of the system you choose as it will be with you for decades to come.
Solar System Components
Your solar system consists of far more than just some panels and power cables. It is a complicated system that must be perfectly installed and finely balanced to safely provide you with the energy saving you expect. The system components include the following:
- Racks and mounts – to hold your panels in place and create your solar array
- Panels – convert solar energy into electrical power
- Inverters – turns DC power into AC and connects your solar grid to the local grid
- Junction box – generally comes pre-installed on the panels it protects the delicate panel circuitry from the elements
- Controller – the brains of the system, this computer handles all of the switching between your panel generated power, the local grid and your batteries
- Batteries – used to store excess energy against low sunlight conditions and to carry your home through the night hours
- Instant shut-off – kill switch for safety issues
Just as there is more to a solar system than the panels and cables, there is more to the cost of the system than the purchase and installation of the various components.
There are both regulatory costs and financial incentives that must be explored before you settle on a budget for your new solar system.
Purchasing Your System
Since each system type has different configurations the purchase price of your system is averaged out from low to high. Exact prices are hard to come by but solar panels tend to be priced by output as are solar systems.
Solar panels come in three types of materials: Monocrystalline, polycrystalline and thin film. The table below displays their relative strengths and weaknesses.
One item not considered in the table is that thin film panels can’t produce as much wattage as crystalline panels, so you will need additional thin film panels to create an equal amount of power to crystalline panels.
|High Heat Effcy
|$1.00 to $1.50
|$0.70 to $1.00
|$1.00 to $1.50
Inverters come in different varieties as well. There are 3 main types of inverters: micro inverters, grid-tied and off-grid. We discuss each in some detail below:
- Micro-inverters – Small but expensive inverters that invert the energy as it leaves each panel. This results in a more efficient system as each individual panel may be experiencing more shade than the others. They also eliminate the need for a large inverter panel at the home level. They can easily grow with your system.
- Grid-tied – A large inverter panel that costs less than the combined cost of all those micro-inverters above and links your home to the local grid. It is also less adaptable to additional panels, so growing your system may mean buying a second inverter.
- Off-grid – Similar to the grid-tied inverter but less expensive, as it only needs to invert the power and send it to your home. Like the grid-tied inverter, it is also less capable of adapting to an increase in system size.
Solar batteries average at 10kWh and are dependable up to 9kWh due to design constraints. The average household uses 30kWh per day, so 3 batteries should be more than enough to handle a 24-hour power outage in your grid-tied or hybrid solar system.
If your system is off-grid, you should prepare for up to three days without sufficient sunlight, so you may want to invest in up to 9 batteries to be certain you will always have power to your home.
Solar batteries come in three varieties: Lead acid, lithium and, more recently, saltwater. You probably raised your eyebrows at saltwater batteries, and we don’t blame you.
It’s an untested technology with the only manufacturer, Aquion, having filed for bankruptcy in 2017. Lead batteries cost far less than lithium but don’t last nearly as long. Plus, you know – lead.
The price range for solar batteries is from $5000 to $7,000, or $400 to $750 per kWh. You can expect to replace your batteries at least once during the lifespan of your solar system.
If you are using crystalline panels, you will need to purchase a rack system to hold them in place. Again, the pricing is based on watts and should be around $0.10 per watt produced by your panel array.
Average System Price
The average home system runs from as little as $4,500 all the way up to $45,000. This site has a handy calculator to help you figure the average total system price for your region. On the whole, the average home use requires a 5kW system at $12.500 to $17,500.
Improving your home brings government hands coming from all directions demanding your hard-earned dollars. You need to be prepared to have funds available for various permits and the many levels of inspections involved in major home projects.
Solar systems are complicated installations and we do NOT recommend you try to DIY the installation of your system. Added to the chances of messing up a high voltage system that may or may not cause a fire in your home is the danger of working on an increasingly smaller area of your roof as the panels go up.
There is one final thought for those who want to DIY it anyway, every warranty on your system will be void. Every. One.
Installation costs are based on, of course, the electrical measurement of your solar system. The broad range is between $6,000 and $35,000 depending on system type, size and where it is located. The regional differences, however, are miniscule in the face of what you are spending overall.
Warranties on solar components differ from item to item but none, barring panel warranties, are likely to impress. Most component warranties don’t reflect the expected lifetime of any of the parts of your system and certainly not the system as a whole.
We want to stress that none of the warranties will matter if you self-install your system. Anything but professional installation voids them all.
There are various federal and local tax incentive programs for installing renewable energy systems to your home – or any home you own. You can also look for incentive programs from your local energy provider. Make sure you look into the following:
- Federal Renewable Energy Programs – currently up to 30% of total cost in tax credits
- Local and State Programs
- Local Energy Company Incentives
- Green Loan Programs
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Umm… How Much Again?
Yes, solar energy systems are not cheap. Installing a good solar system with proper battery backup can climb close to, or just over, $50,000. So how are all these middle-class homes going solar? Two words: leasing and financing.
The solar industry faced a huge problem with the high expense of their product, despite generous government incentives. While financing is a viable option, the market pool for financing such a large sum remains pretty slim. Leasing, however, opened the market to the average homeowner.
If you don’t have up to $50,000 stuffed in your mattress, here are the things to consider when deciding between leasing and financing.
Financing your solar system allows you to retain ownership of your system. It’s all yours, but so are the costs of replacement and repair – which are inevitable,
- Total ownership
- No lease agreements to fulfill
- Once it is paid off your energy is free
- Responsible for all replacement parts and repairs
- Upgrading is a new large expense
- Large down payment
Leasing your solar system comes with lower payments and fewer surprises than financing. The average monthly bill on a leasing program runs from as little as $50 to $250 per month, depending on the size of the system and other considerations.
- Instant realization of energy savings
- Repairs and replacement are covered
- Low or no down payment
- Payments never end
- Must adhere to lease requirements
- Must convince new owners to take on the lease when selling your home
If you have the means, paying for your solar system outright is the way to go. If you don’t, financing or leasing can open the door to your home being solar powered. Which one you pick is a matter of which aspects of the two programs are priorities to you.
Some find the convenience and comfort of a lease agreement to be more appealing than the potential added expenses that come with the freedom and finite payments of financing and ownership.
Whether you want to do your part to save the planet, just want to save your wallet, or you want to get out from under the thumb of the local power grid solar power is an answer to your desires. The systems, while expensive, will pay you back in savings long before they need to be replaced. Good luck!