We here at SolarReviews have been asked countless times by our site users how much it will cost to install solar panels on their home. When we tell them that it depends on a few key factors they invariably ask, “well then can you tell me what it will cost to install solar panels on an average home”.
This article aims to answer this question as well as we can at a general level without oversimplifying the facts to a point where the answer is useless for any particular homeowner. By showing you the steps we go through to work it out you will have a better appreciation of what the number really means and how your house might compare to the average home.
The first thing we need to do to work out how much it will cost to install solar panels on an average home is to work out how much electrical energy the average home uses. Fortunately the Energy Information Administration (EIA) publishes data on this.
In 2016, the average annual electricity consumption for a U.S. residential utility customer was 10,766 kilowatt hours (kWh), an average of 897 kWh per month. Louisiana had the highest annual electricity consumption at 14,881 kWh per. residential customer and Hawaii had the lowest at 6,061 kWh per residential customer.
Energy usage varies by state significantly and even by regions within states.
What is the average amount of electricity used in an American home in 2018?
Average electricity usage for the top solar states in America
|State||Monthly Usage kWh||Annual Average Usage kWh|
|New York||595 kWh||7,140|
|South Carolina||1115 kWh||13,380|
This data is a little distorted for states like New York and California because of the high percentage of multi-family buildings in these states. There are not statistics kept specifically for free standing homes but it is likely that if there were then the usage would be higher than the average for all homes.
However, for now to work out how much solar panels cost for the average American home lets just take the average of 897 kWh per month.
How many solar panels does the average home need?
The number of solar panels a home needs is a function of the electricity use we are trying to replace (we are assuming the average of 10,766 kWh per year) and the climatic conditions where you live.
The reason the climatic conditions are important is that these conditions will determine the amount of electricity generated by each solar panel that you install. Sunnier areas such as Arizona produce more electricity per kW of solar panels installed than areas like the north east where it is cloudy much more often.
The reason this affects cost is that solar panels are prices by the kW (kilowatt) and the more kilowatts you need the more the cost you will face to install solar panels.
The table below shows the average number of kWh’s (kilowatt hours) of energy produced each year by 1 kW of solar panels installed on a south facing roof in each of the listed states. You can find out how much is produced in the other states, (and even down to a specific city in the states listed below), by using our solar panel calculator.
|State||Annual Production from solar panels kWh|
|New York||1230 kWh|
|South Carolina||1350 kWh|
So now if we combine the two tables above we can work out how many solar panels the average house in each state would need to cover their entire electricity usage.
Once we have this system size (number of solar panels) we are only one step away from working out what the average cost of installing solar panels is in each of these states.
What are the number of solar panels required in each state to cover the average homes electricity use?
The table below shows the kilowatts of peak capacity solar needed to cover the average power bill in each state but it does not list a specific number of panels.This is because solar panels can come in different sizes. For residential solar panels the wattage of an individual panel is typically in the range of 270 watts per panel up to 360 watts per panel.
|State||Required system size to cover average household electricity usage in that state|
|New York||5.8 kWh|
|South Carolina||9.91 kWh|
So what does a full installed solar power system with a peak DC rating large enough to cover the average electricity bill in each state cost?
At SolarReviews we have two sources of solar panel cost data with a strong focus on the cost of installed solar systems rather than the cost of solar panels on their own or the cost of solar panel installation labor for those that have purchased the equipment and are just looking for someone to install it for them.
Our first source of solar panel cost information is the consumers who use the SolarReviews website who choose to share quotes they have received from local solar companies with other users of our site. This is why our “how much do solar panels cost page” has the most accurate and up to date information on solar prices being offered by solar companies all over the country. We update this page each month so that you can always rely on the currency of the data on it.
Our second source of solar panels cost information is the Solar-Estimate.org solar cost calculator which is used by around 2000 consumers a day.
This platform is unique because it is the only online solar panels calculator that provides you with both an instant online estimate of your required system size, likely system costs and savings but then also gets our pre-screened solar pro’s (there are about 235 on the solar-estimate marketplace covering most cities) to give you an accurate quote by taking a look at your roof online and delving more into your exact power use patterns.
Once these solar pro’s take a look at your roof they send you through a real and binding quote and so we can also use these quotes to compile our solar panels cost information. This information is available on the Solar Estimate homepage.
In California where the average system required is 4.23 kW SolarReviews research data shows that the average solar panel installation cost in 2018 is $3.18 per watt meaning the 4.23 kW system would be $13,451 before the solar tax credit and $9,415 after the federal tax credit.
However, it is likely that these numbers are distorted by the lower average energy use of multi family homes and that in fact the average single family home in California actually uses more power and so would require a bigger system, Our pre-screened solar pro installers in California tell us their average residential system size is more in the range of 6-7 kW.
In Arizona where a 7 kW system is the average and our data shows the average cost as at 2018 is $3.15 per watt then the average system cost is $22,050 before the tax credit and $15,435 after the tax credit.
In Florida where energy use is very high and the average system needed is around 10kW then the average cost of a solar system is $28,740 or $20,119 after the 30% solar tax credit.
In Utah, another very competitive solar market, where the average system size needed is 5.7 kW and the average system cost per watt is $3.00 then the average cost of an installed residential solar system is $17,100 before the tax credit and around $11,970 after the 30% solar tax credit.
However, it should be remembered that there are a lot of really competitive zero down solar loans available now and so most people can get a system with monthly repayments less than their energy bill savings.
How would the cost of solar for your house compare to the average?
Obviously the cost will be more if your energy usage is more than the above averages but this usually also means your lifetime savings from going solar are much more than average.
Your house and its characteristics will also affect the cost you will face to go solar and the best way to find out an accurate estimate is to enter the details or your home and energy usage into the solar panels calculator to receive an online solar cost and savings estimate and then expert advice from on of our local pre-screened solar companies.