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 here to begin!
You’re in luck - we’ve compiled some of the most commonly asked questions about solar panels for home 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.
How much electricity you use will impact how much you pay for your solar system. 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. 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 can 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. States like New Jersey, Massachusetts, and Washington D.C. offer performance-based incentives that give homeowners extra money for the solar energy they produce.
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.
3. How do solar panels work?
Solar panels capture energy from the sun and turn it into usable electricity for your home. By using the solar power produced by your panels, you use less electricity from your utility company, thereby lowering your energy bills.
The main components of a solar power system are the solar panels, the solar inverter, and the racking equipment. The way your solar panel system operates will depend on what type of system it is: grid-tied, hybrid, or off-grid.
Most home solar panel systems are grid-tied systems. This means that any time your solar panels produce more electricity than your home needs, the excess power gets sent to the grid. When your solar panels aren’t producing enough electricity to power your home, you take electricity from the grid.
Most states offer some form of net metering, meaning you’ll get compensated for that excess electricity you send to the grid, usually in the form of a credit on your electricity bill.
Check out this video to get a better idea of how grid-tied solar systems work:
Hybrid solar systems are starting to become more popular throughout the U.S. With a hybrid system, you are still connected to the grid, but your panels are also connected to a solar battery. The battery lets you use all of the solar energy your panels produce (it stores power when it is made and keeps it for later when you need it) and is guaranteed to keep your lights on in the event of a grid power outage.
Some homeowners install off-grid solar systems, although it is less common. An off-grid system is exactly how it sounds - it isn’t connected to the grid at all. This means you need enough solar panels and solar batteries to run your entire home 24/7. Most off-grid systems are installed on second homes, like mountain cabins, but aren’t as practical on everyday homes that have grid access.
4. How much money can I save with home solar panels?
The average U.S. home will save around $114 per month with a residential solar system. The amount that you actually save with solar panels for home depends on your energy usage, how much your utility charges for electricity, and the size of your system.
This is why states with high electric prices, like California and New York, are such popular places to install solar panels - not because they are overly sunny - it’s because they pay the most per kilowatt-hour (kWh) for electricity. They also save the most with solar.
In fact, depending on how you size your solar panel system, you can eliminate your entire electric bill.
If you spend $120 per month on electricity and install a solar panels system that is designed to offset all of your electricity usage, you could end up saving $36,000 over the lifetime of the system!
5. How many solar panels do I need?
The average home will need between 14 and 36 solar panels to cover all of its energy needs.
The number of solar panels for your home will vary based on your energy consumption, how much sunlight your area gets, and the solar panel you choose. If you live somewhere that gets less sun, you’ll need more solar panels to produce enough electricity to meet your needs.
To figure out how many solar panels you need, you need to multiply the watts of power you use each month by the hours of sunlight your home gets each month, and divide that by the wattage of your solar panel.
Or, you can choose a much easier route to figure out how many solar panels you need- by using our solar panel calculator.
6. 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 money to your overall system cost without saving you that much more on your utility 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.
If your main reason for switching to solar is to decrease your carbon footprint, then installing a solar battery is the best way to maximize the amount of renewable energy your home uses. Otherwise, you can just take power from the grid when your solar panels aren’t making electricity.
Check out our blog on solar batteries for more details on whether or not a solar battery is right for your home.
7. Is it better to buy or lease solar panels?
Buying solar panels outright will give you the maximum electric bill savings over the lifetime of the system. By purchasing your solar panels, you are the owner of the system, so you will be able to benefit from all of the solar incentives in your area. But, we understand that the upfront costs of installing solar can be intimidating.
Because of this, some people choose to enter into a solar lease or solar PPA. While solar leases and PPAs allow you to avoid the upfront costs of installing solar, they provide you with much lower savings over the lifetime of the system. Also, because you don’t own the system when you have a solar lease, you won’t be eligible for certain solar incentives, like the federal tax credit.
A better option when you don’t have the cash to purchase a system right away is to take out a zero-down solar loan. Many solar financing companies offer low interest rate loans, so you will have higher long-term savings than you would with a solar lease. Plus, you are the owner of the system with 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.
8. 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 can last 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.
9. 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. Most Tier 1 solar panel brands offer monocrystalline solar panels with efficiencies between 19% and 22%.
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.
10. What are the best brands of solar panels for home?
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.
We recommend that homeowners stick to Tier 1 solar panel brands, like the ones listed here, as they’re more reliable.
For help picking solar panels that are right for you, check out our solar panel reviews page.
11. Can I install solar panels for my home myself?
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 out equipment warranties.
Stick with a solar installer to save yourself a lot of time, and a lot of headaches.
12. Are solar panels worth it for my home?
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.
So, while it is up to you to decide the best way to spend your hard-earned money, we can safely say residential solar panels compare favorably to other traditional forms of investment.
Solar panels typically provide a simple return of investment between 10% and 15%. You can take a more detailed look at whether or not solar panels for home are financially worth it here.
Many solar installations in America have a solar payback period of between 4 and 10 years - after that your panels are providing nothing but savings to you! The best way to see if solar panels are worth it for your home is by using our solar savings calculator below.
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.