Solar panels for your home in 2021 - what you need to know
When you’re starting to research solar panels for your home, it can be overwhelming. There’s a lot of information out there - and it’s hard to know where to begin!
You’re in luck - we’ve compiled some of the most commonly asked questions about solar panels for homes to help you figure out if solar is right for you.
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1. How much do solar panels cost?
The average cost of solar panels for homes in the U.S. is about $2.49 per watt. This means an average 7 kilowatt (kW) residential solar panel installation would cost $17,430, before incentives. Once you apply the 26% federal solar tax credit, the price falls to around $12,898.
The cost of solar has continued to decrease over the years and is now 70% cheaper than it was just 10 years ago!
How much you pay for solar panels for your home will vary depending on how much electricity you use. The more electricity you use, the more solar panels you will need, and the more you’ll have to pay.
You can enter your address and your monthly power cost into our solar calculator below to find out how much a solar system for your specific home will cost you based on prices offered by solar companies in your area.
2. How much money can I save with home solar panels and net metering?
The average U.S. home will save around $114 per month with a residential solar power system - that's over $34,000 over the lifespan of the system!
Solar panels are able to save homeowners so much money through a policy called net metering. When your solar panels make more kilowatt-hours of electricity than your home can use, the excess energy is sent to the grid.
With net metering, your utility company will pay you for that excess power, usually in the form of a bill credit that can then be used to offset future energy costs when your home’s energy consumption is higher than your solar production and you take electricity from the utility grid.
This video gives a great overview of how solar panels and the grid work together to power your home:
Without net metering, you wouldn’t get anything for the extra electricity you produce, and you wouldn’t save nearly as much. Your utility’s net metering policy, your energy usage, solar system size, and your electric rate all impact how much you will save with solar.
3. Will a home solar panel system pay for itself?
Yes! Home solar panel systems pay for themselves. Many solar installations in America will pay for themselves anytime between 4 and 10 years.
Also called the “solar payback period”, this is how long it will take to pay off your solar panels through electric bill savings. After that, your solar panels are making you completely free electricity!
Solar payback periods vary depending on the cost of the system, the price of electricity in your area, and how much electricity your system produces. Your solar payback period can be even shorter depending on the incentives and rebates you qualify for.
4. What rebates, tax credits, and other solar incentives are available in my area?
The biggest solar incentive available for home solar panels is the federal solar investment tax credit, also referred to as the ITC.
The ITC allows homeowners to receive a solar tax credit equal to 26% of the total cost of installing solar panels on their roofs. However, the tax credit reduces to 22% in 2023, before completely expiring in 2024. So, the sooner you install solar - the bigger tax credit you will get!
Some homeowners are lucky enough to be eligible for additional state and local incentives. Some states, like New Mexico, have a state solar tax credit that can be used on top of the federal tax credit.
Our solar calculator is the easiest way to find out what incentives are available in your area. We make sure our solar estimator is up to date with all of the tax credits, rebates, and other local incentives information offered throughout the country.
5. Are solar panels worth it?
The exact answer to this question depends on the location of your home, the amount of electricity your home uses, and local installation costs. But in most cases, solar is a worthwhile investment for homeowners.
Solar panels typically provide a simple return on investment between 10% and 15%.
So, it is up to you to decide the best way to spend your hard-earned money, but we can safely say residential solar panels compare favorably to other traditional forms of investment, like buying a home or investing in the stock market which typically have returns of 5% and 9.5%, respectively.
Plus, while you’re getting a solid financial return, you’re also powering your home with clean energy and reducing your carbon emissions! Definitely worth it in our book.
6. Can solar panels power an entire house?
Yes, solar panels can power an entire house. When you contact a solar installer, they will help you size your solar system so it will cover all or most of your electrical needs. The higher your electrical consumption, the larger the solar panel system you’ll need to power your home.
7. How many solar panels do you need to run a home?
Between 21 and 34 solar panels are needed to power an entire average American household.
The number of solar panels for your home will vary based on your energy needs, how much sunlight your area gets, and the type of solar panel you choose.
If you live somewhere that gets less sun, you’ll need more solar panels to produce enough solar power to meet your needs. If you choose higher-wattage solar panels, you will need fewer solar panels to cover your utility bill.
8. What are the best types of solar panels for your home?
Monocrystalline solar panels are the best type of solar panels for home use. The solar cells within monocrystalline panels allow for higher efficiency ratings and a more uniform look, which most homeowners prefer.
In the past, monocrystalline solar panels were significantly more expensive than polycrystalline solar panels, another popular solar panel choice. However, as technology has improved and prices have fallen, the price difference between monocrystalline and polycrystalline panels has become minimal.
For about the same price, monocrystalline panels perform better and look better - a win-win for homeowners.
9. Do I need a solar battery?
In most areas, you don’t need to install a solar battery with your solar panels. Batteries will add more money to your overall system cost without saving you that much more on your electricity bill. However, some states do offer solar battery incentives, which can make solar batteries a better economic investment.
Solar batteries make the most sense in places that experience frequent grid power outages and states without net metering. Widespread blackouts are becoming more common throughout the United States, so many people are starting to pair their solar panels with solar batteries for backup power just in case their power goes out.
Check out our blog on solar batteries for more details on whether or not they're right for your home.
10. Are there home solar financing options?
Buying solar panels with cash will maximize your electric bill savings over the lifetime of the system, and ensures that you will benefit from all of the solar incentives in your area. But, we understand that the upfront costs of solar can be intimidating.
Luckily, there are solar financing options that can help you with the large upfront costs of installing solar. The most popular are:
Solar leases and PPAs allow you to avoid the upfront costs of solar, but they provide much lower electric bill savings over the solar system’s lifetime. Also, you don’t own the solar panels when you enter a solar lease or PPA, so you won’t be eligible for certain incentives, like the solar tax credit.
Solar loans are a much better option for when you don’t have the cash to purchase a system right away. Many solar financing companies offer zero-down, low interest rate loans, which will give you much higher long-term savings over the life of the system than a solar lease or PPA. Plus, you own the system when you take out a solar loan, so you can still take advantage of tax credits and other incentives.
You can learn more about whether buying or leasing solar panels is better for your particular situation here.
11. What are the best brands of solar panels for home use?
Some of the top-selling home solar panel brands are:
All of these panels are great choices for your home solar installation. SunPower’s panels are the most efficient out of the three, while LG and Panasonic offer greater corporate bankability. However, all three of these solar panels are very expensive when compared to panels sold by other Tier 1 manufacturers.
Some other great Tier 1 solar brands you should keep an eye out for are LONGi, Canadian Solar, REC Solar, Trina, Jinko, and QCells. All of these brands offer excellent solar panels at a much lower cost.
For help picking solar panels that are right for you, check out our solar panel reviews page.
12. How long do solar panels last?
All major solar panel brands have a minimum warranty life of 25 years and some premium brands have a warranty of 30 years! However, solar panels are known for lasting well beyond their warranty life.
But what if you are planning to move within the next 25 years - are solar panels still a good investment? The answer is yes! Solar homes actually sell faster and for more money than homes without solar.
13. Can I install my own solar panels?
Yes, you can install solar panels on your home yourself. By opting for DIY solar, you can cut down on the cost of installing solar, and you get the satisfaction of completing the project yourself.
However, we don’t recommend installing solar panels yourself. It’s risky and dangerous. Plus, DIY solar installations don’t qualify for all the same incentives that professionally-installed systems do, and some local utilities may even not allow it. Not to mention, installing solar yourself may void equipment warranties.
Stick with a solar installer to save yourself a lot of time, and a lot of headaches.
14. What are the different types of home solar systems?
All solar panels capture energy from sunlight and turn it into usable electricity for your home. The main components of a rooftop solar PV system are solar panels, solar inverter, and racking equipment.
The way your solar energy system will operate depends on the type of system it is:
- Grid-tied solar systems: The most common type, where solar panels are connected to the grid and send excess energy to the utility. When solar energy production is low, the home takes energy from the grid.
- Hybrid solar systems: Rising in popularity, these systems are connected to the grid but are also connected to a solar battery. Excess energy the panels produce is sent to the battery and then drawn from it when solar production is low.
- Off-grid solar systems: Less common, are popular among second homes with limited grid access, like mountain cabins. Usually consist of large solar systems with large battery banks.
All of these solar photovoltaic systems operate a bit differently, but they accomplish the same thing - running your home on clean, renewable energy while lowering your electric bills.
15. Are solar panels right for your home?
There are a few things to consider before you decide to go solar.
What direction does your roof face? Solar panels work best on southern-facing roofs, but that doesn’t mean you can’t install solar panels on other sides of your roof.
Do you need a roof replacement? Solar panels last 25 years, so if your roof needs to be replaced in the next few years, you might want to replace that first before installing solar.
What is your electric usage? Review your electric bills and see if there are ways you can increase your home’s energy efficiency. This decreases the amount of electricity you use and could allow you to get a smaller solar system.
Solar quotes. You should always get quotes from at least three different reputable solar installers so you can find the best price for the best quality installation in your area.
- The average cost for solar panels is about $2.49 per watt before the federal solar tax credit.
- Most home solar panel systems in the U.S. will pay for themselves after 4 to 10 years.
- Solar panels are a worthwhile investment, as they provide good returns and allow you to power your home on renewable energy.
Author: Catherine Lane | SolarReviews Blog Author
Catherine is a researcher and content specialist at SolarReviews. She has strong interests in issues related to climate and sustainability which led her to pursue a degree in environmental science at Ramapo College of New Jersey.