Solar panels for homes are becoming more affordable and accessible than ever before. It took 40 years for the number of solar panel installations in the United States to surpass the one million mark, which it did in 2016. But just three years later that solar installation total had doubled, and by the end of 2021 the number of American homes and businesses using solar energy is projected to exceed three million .
A Pew Research Center poll taken in 2019 found that 46 percent of homeowners were seriously thinking about getting solar panels for their homes, and the percentage willing to consider this option was rising fastest in the Southern Atlantic states, far from the West Coast where solar has gained its biggest beachhead . Solar energy accounted for 43 percent of the new electricity-generating capacity added in the United States in 2020, which proves these sentiments are being translated into action .
“The rapid growth in the solar industry has completely reshaped the energy conversation in this country,” declared Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association . “This $17 billion industry is on track to double again in five years, and we believe that the 2020s will be the decade that solar becomes the dominant new form of energy generation.”
The trends in solar—and in the U.S. energy market—are clear and unmistakable. If you do decide to jump on the solar energy bandwagon soon, you certainly won’t be taking that leap alone. Our ultimate guide will help you with getting solar panels for your home right from the beginning.
Should you get solar panels now in 2021 or wait?
Between 2009 and 2020, the cost of home rooftop solar panel installation projects declined by 67 percent, falling from $8.50 to $2.81 per watt of generating capacity over that time period .
Your knowledge of this trend may leave you reluctant to take the solar plunge immediately, since further price decreases can presumably be expected in the future. But delaying your rooftop solar installation offers no guarantees.
While the cost of solar energy has continued to drop, the rate of decline has been decelerating. Since 2017, the cumulative cost of solar installations has dropped by just 11 percent, or about three cents per watt per year . Should the rate of increase decline further, meaningful cost savings may not be available for those who decide to wait.
Regardless of any theoretical reductions in upfront costs, every year you wait to install solar panels is another year you’ll be purchasing 100 percent of your electricity from the grid, thereby postponing your quest for energy independence. Depending on the size of your home and family, switching from grid power to solar energy could save you anywhere from $1,000 to $3,000 per year on your utility bills.
Another reason to make the jump to solar as quickly as possible is so you can enjoy the special financial benefits that are currently available, but may not be for much longer.
For example, net metering practices that allow homeowners to sell their excess solar power to utility companies have become increasingly controversial. Many states have announced cutbacks in net metering practices, and some may ultimately eliminate net metering altogether (Hawaii and Louisiana are two states that have already done so) . Other states are planning to keep their net metering programs but eventually to begin restricting access to existing solar customers only.
Tax credits and rebate programs that can help offset solar equipment purchase and installation costs may also be at risk. Some of these initiatives will be allowed to expire (the federal tax credit is currently set to expire in 2023), others may be phased out gradually, and still others might be ended abruptly by states, counties, or municipalities dealing with sudden budget crunches.
Should you decide to wait to purchase rooftop solar panels for two or three years, you might get lower quotes from solar installation companies than you’d get next week or next month. But those savings may be an insufficient substitute for the benefits you’ll enjoy by going solar now, while governments are still enthusiastically supporting the industry.
Does it ever make sense to wait with going solar?
In general, purchasing your solar panels immediately is the right option. But the one legitimate reason for waiting is if you’d like to pay for your solar energy system entirely in cash and you need more time to save the necessary funds.
If you finance your purchase with a solar loan, the interest charges could increase your repayments by several hundred to more than a thousand dollars annually for the term of the loan, assuming your loan would cover the full cost of your purchase . Even if you have no choice but to finance at least part of your solar installation package, the more of it you can pay for upfront the better off you’ll be in the long run.
You can learn more about the pros and cons of going solar in 2021 by reading our in-depth analysis of the topic here.
How many solar panels does it take to power a home?
The average American home will require somewhere between 21 and 34 solar panels to meet 100 percent of their energy needs . The final number is based on a homeowner’s individualized energy use habits, which vary by home size, home architecture, family size, and lifestyle.
Fortunately, you won’t have to guess how many solar panels your home requires. There is a simple calculation you can perform, using readily available data, that will help you determine this number.
This equation is :
To determine the first number, you’ll need to check your utility bills, covering a 12-month period, to find out how much electricity you use in a single year. This data may be provided on one monthly bill, or you may need to add your energy use totals from 12 separate monthly bills to get this number. You’ll then divide the number by 12 to obtain your average monthly consumption total.
Peak sun hours are when the sun is more or less directly above you. They are important because it is during these times when your solar panels will be producing the vast majority of their daily energy. Peak sun hours will vary based on season, but you can still get a good approximation of how many solar panels you’ll need by using the average monthly number.
To get that number, you should multiply your state’s peak sun hour daily average by 30.
When you divide your monthly electricity consumption by peak sun hours, your answer will be expressed in kWh. The number you get will tell you how big your solar panel array will need to be to meet 100 percent of your electricity needs.
For example, if you consume 1,000 kWh of power each month, and live in an area with an average daily peak sun hour total of five, you would divide 1,000 by (5×30) 150, which would produce an answer of 6.67 kWh—which is the size of the solar energy system you’d need to purchase to meet all of your home power needs.
To convert this into actual solar panels, you’ll need to multiply your answer by 1,000. This converts kilowatt-hours into watts (6.67 would become 6670 in our hypothetical example), and you’ll need this information because solar panels are rated by the number of watts they are capable of producing.
A standard solar panel will likely be rated at around 250 watts, which is an expression of its power-producing potential . Supremely high-efficiency panels would be rated at 400 watts, and there are many solar panels that fall somewhere in between the lower and upper limits.
If you decided to install standard-size panels in our hypothetical example, you would divide 6670 watts by 250 watts, and your final answer would be 26.7. Rounding up, this would mean you’d need to purchase 27 standard-sized, 250 watt solar panels to meet 100 percent of your home energy needs.
Naturally, you could reduce this number by purchasing high-efficiency panels, which convert a greater percentage of sunlight into electrical energy. High-efficiency panels aren’t likely to cost you more on a per watt basis, and should be the preferred choice when roof space is limited.
Should you purchase extra solar panels?
The solar manufacturer SunPower recommends that you install a solar panel array that includes a 25 percent “cushion,” or extra generating capacity, to make up for the fact that your solar panels won’t work at their highest potential efficiency at all times .
This may happen because:
- Weather conditions (clouds or storms) reduce actual peak sun hours on some days, enough so that your battery storage isn’t always sufficient to meet all of your energy needs
- Your rooftop’s orientation or tilt angle doesn’t allow your solar panels to be installed at an optimal angle for capturing the sun’s rays
- Shading over your rooftop decreases sunlight exposure at certain times of the day
- Your solar panels are a few years old and have lost some of their energy-generating capacity (this type of attrition is expected)
You should consult with your solar contractor about these issues, and they can help you decide whether or not you really need to install extra panels.
Reasons why you should purchase fewer solar panels for your home
Most home solar energy systems are connected to the grid, regardless of their size and overall energy-generating capacity.
This eliminates the need to install batteries with the system, since grid power can fill in the energy gaps when the sun is not shining. Additionally, if your system is grid-connected, you can divert any excess power it produces back to the grid, in return for credits on your utility bills. The latter practice is known as net metering, and as of now net metering benefits are still available in the majority of states and U.S. territories .
Grid-tied systems are also convenient if you can’t afford enough solar panels to meet 100 percent of your energy needs. A solar array that meets even half your needs will still be economically advantageous, and as long as grid connection is available you can always choose that option
The other reason why you might purchase fewer panels than you really need is because you don’t have enough roof space or ground space to support a larger system. Most solar panels are 65 inches long and 39 inches wide, and the most popular variations are still fairly close to these dimensions .
How to calculate rooftop solar panels payback period
Solar panels are an expensive investment. If you install a 10-kilowatt rooftop or ground-mounted solar panel array in 2021, you can expect to pay from $17,760 to $23,828 for the total cost of the installation, after tax credits and rebates have been deducted . If you take out a solar loan to help reduce the upfront costs, you’ll have to pay interest for 10 to 20 years in addition to paying back the principal.
Your savings on electricity costs will offset this investment eventually, which is the primary reason you’re considering solar in the first place. But you need to know how long it will take for your solar panels to produce enough energy to pay for themselves. This is an important consideration, and you must have an answer before you choose a contractor and decide how many panels you want to install.
If you do not want to use freely available online tools, you can also calculate your solar panel payback period on your own to make sure you’re making a sound investment choice.
Factors to evaluate in your calculation
In principle, calculating your solar payback period should be a fairly straightforward matter. However, to get an accurate figure, you must make sure to perform a full and complete accounting of all costs and benefits, to remove all uncertainty from your calculations.
On the cost side of the ledger, you’ll need to solicit bids from solar contractors that are thorough and comprehensive. Their bids should cover the costs of equipment, labor, permitting, warranties, and maintenance plans, and you should read the fine print to make sure they’ve haven’t reserved the right to hit you with additional costs at some future date .
These bids should also include detailed information about how much electricity your solar panels will be able to produce on an annual and/or monthly basis, which is data you’ll need before you can begin to calculate your potential costs savings.
On the benefits side of your analysis, you should include:
#1 Monthly energy savings
You may be able to eliminate energy costs entirely, if you plan to purchase and install an off-grid solar energy system (with battery backup) that will be large enough to meet all of your electricity needs. But if you install a grid-connected system that will meet only a percentage of your needs, it means you’ll be reducing your monthly energy bill instead of eliminating it .
As you calculate your savings, it is important to factor in potential price increases for grid-produced electricity, which you can do by checking out the historical data on price inflation in the energy sector .
#2 Tax credits and rebates
The federal investment tax credit for solar energy allows you to deduct 26 percent of the cost of installing rooftop or ground-mounted solar panels from the federal taxes you owe . Local and state tax credits and rebates for renewable energy systems are also available in most states and in many municipalities, and taking advantage of these programs can further reduce your financial liability .
A few states (currently eight plus the District of Columbia) offer an additional form of credit known as a Solar Renewable Energy Certificate, or SREC, for solar homeowners . They are calculated based on energy output, and you can generally expect to earn one SREC for every 1,000 kilowatt-hours of energy your system produces.
SRECs can be sold to utility companies to help them meet their renewable energy portfolio requirements, and you could make anywhere from $100 to $2,000 annually off your SRECs depending on how many you earn and the prices paid for them in your state.
#3 Net metering
Utility companies distribute net metering benefits to compensate you for the energy you produce for them. In 34 states plus the District of Columbia and four U.S. territories, net metering mandates require local utility companies to offer you kilowatt-hour credits for the electricity you export to the grid, while 11 other states will soon offer alternative forms of compensation that function as the equivalent of such credits .
You should consult with your solar contractor, your local utility company, or friends or neighbors who’ve already installed solar panels to find out how much you can expect to earn in net metering benefits throughout the year.
Making a final calculation
The total cost of your solar energy system will include the total price for the goods and services you purchase, as detailed on each contractor’s bid, minus all applicable tax credits and rebates.
To get an accurate estimate of your solar payback period, your calculations should include:
- Reductions in kilowatt hours of electricity you’ll be purchasing from the grid, multiplied by current grid power prices and anticipated future grid power prices
- The credits you expect to earn selling excess power back to your utility company through net metering mechanisms
- Possible benefits you can accrue by selling your SRECs to your local utility company
With costs and benefits precisely spelled out in monetary terms, you’ll be able to make an accurate estimate of when your cumulative savings will surpass your total investment.
Although most solar contractors will help you make these required estimates, it is ultimately your responsibility to make sure you take advantage of all the possible rebates, tax credits, and other benefits that will allow you to shorten your payback period to the maximum extent possible.
Important information about solar loans
It may be possible to eliminate most or all of your upfront costs by taking out a solar loan with a financial institution that offers this type of financing. In addition to banks or credit unions in your area, you may also be able to obtain a solar loan from a solar panel manufacturer .
Solar loans should be structured so that your monthly repayment amounts are lower than your expected monthly energy savings, which means you’ll be able to enjoy a positive cash flow from the instant your solar energy system goes online.
Financing your solar panels will allow you to reduce your payback period, or possibly even eliminate it altogether if your loan covers the full cost of your new system. However, you should be aware that your long-term savings will be reduced if you choose to finance all or part of your purchase. Loans must be paid back with interest, and this interest represents an added cost that will ultimately reduce your rate of savings.
The solar panel installation process, step by step
Several weeks can pass from your initial consultations with solar energy retailers to the day your new solar panels go online. This is unavoidable, but the best way to minimize the time is to get started right away, before another day slips away.
#1 Selecting a solar contractor
You should solicit bids on your solar energy project from multiple solar contractors. Each should send qualified technicians to your home to perform a full and comprehensive assessment of your property to evaluate its suitability for a rooftop or ground-mounted solar panel installation.
While their evaluation of your home is important, the most critical evaluation is the one you’ll perform on them. You should select a solar contractor based on the following criteria:
- Qualifications. Solar contractors should have general liability insurance and hold all the business and contracting licenses required to practice solar work in your community and state. Their installation crews should be led and/or staffed by installers who’ve been tested and certified by the North American Board of Certified Energy Practitioners (NABCEP), which is the most prestigious certifying institution in the solar industry .
- Experience and Reviews. The best solar companies will have an established reputation in the community, and employ people who have good resumes and include at least some installers and technicians who’ve been working in the industry for several years. High-quality companies will have impressive online reviews from satisfied customers, and will have shown the willingness to respond quickly when issues emerge or complaints are made.
- Customer Service. Superior contractors are easy to reach online or by phone, and will always respond to questions and requests for information quickly and thoroughly. When on site, technicians and their supervisors will be personable, professional, and eager and willing to explain their company’s policies and procedures.
- Bid Quality and Comprehensiveness. When comparing bids, you should look for those that provide the most extensive and detailed information about all projected costs (for solar equipment, support hardware, wiring, roof repair or remodeling (if required), permitting, and maintenance plans). They should inform you about any and all available rebates and tax credits, and provide warranties on your solar equipment and the quality of their workmanship.
- Equipment Quality. Legitimate solar installers sell solar equipment manufactured by established companies with sterling reputations for expertise and craftsmanship. Prices should be in line with industry standards, and product descriptions should include all relevant details that will allow you to make educated choices.
#2 Preparing for the installation
Before an installation can begin, either you or your installer will need to:
Complete a thorough site evaluation
Trained solar technicians will evaluate your current electrical system and supporting infrastructure, and recommend upgrades or alterations as necessary.
They will also examine your roof closely, identifying and measuring roof space that is capable of supporting solar panels and associated hardware. They may also need to evaluate your roof’s angle of tilt, which could be an asset or a hindrance depending on how much direct sunlight it will allow your solar panels to harvest.
Limitations in roof space or other architectural factors may not allow for installations as large as the client would prefer in some cases. If you’re willing to consider ground-mounted solar panels as an alternative, solar technicians can evaluate your property to see if this is a legitimate option.
Examine and approve the blueprints for the solar energy system
After the assessment is complete, your installer will create a detailed installation plan that includes:
- the number of solar panels to be installed,
- the choice of inverter and batteries,
- the details of the wiring system,
- grid interconnection plans,
- any alterations to the physical structure of your home that will be necessary to support the installation.
Everything should be explained to you in detail before the project begins, so you can ask questions and offer your input before providing final approval for the plan.
Apply for all required permits
Your solar contractor will act as your liaison with city permitting departments, your local homeowner’s association, and your utility company. They will arrange for all the necessary building and electrical permits to be issued, and while this process can take a week or more to finish it must be completed before actual installation and construction work can begin.
Arrange for financing and apply for all available benefits
While the permitting process continues, your installer will also help you collect information on all available renewable energy grants, rebates, and tax credits. They will help you with the paperwork necessary to apply for these various benefits, which may be available from federal, local, and state governments, from solar panel manufacturers, and from nonprofit organizations on occasion.
If you have questions about financing, they can put you in contact with credit unions or banks that offer solar loans or other types of financing packages.
#3 Completing the installation
Residential solar panel installation projects take about three months to finish on average . This includes the time it takes to complete a site assessment, design a customized system, purchase the equipment and hardware, secure the necessary permits, arrange financing and apply for rebates and tax credits, perform any required alterations or remodeling of the home and surrounding property, and assemble a team of professionals to handle every aspect of the final installation.
But the good news is that the actual installation won’t take your contractor any longer than two or three days to finish, which means minimal disruption to your daily life .
Once your panels have been installed, and the installers have completed any necessary modifications to your electrical system, you’ll be nearly ready to join the exclusive ranks of the solar energy homeowner.
#4 Arrange for final inspections and launch your new solar energy system
Once your contractor has finished their on-site work, your county or municipal authorities will send a licensed inspector to your home to check your system for compliance.
Once you’ve gotten approval from the proper authorities, you may need to contact your utility company to arrange for one final inspection, or you may be able to skip this step if your county or city inspector plans to send their report to your utility provider.
Either way, your utility company will need to give its official seal of approval to your project, which is known as a permission to operate (PTO), before you can flip the switch and activate your brand new solar energy system . It may take a week or two for your PTO to be issued, but once it is you’ll be free to activate and begin using your brand new solar energy system.
Solar panel maintenance and cleaning
Modern solar panels are precisely manufactured for durability and efficiency. They come with warranties that guarantee up to three decades of acceptable performance, and with no moving parts they have little potential for mechanical failure.
While solar panels don’t really wear out, their performance will degrade over time. Studies by the National Renewable Energy Laboratory (NREL) show that, on average, the performance of standard solar panels will degrade by about 0.5 percent per year . This means that a solar panel that has been installed and in operation for 25 years would be functioning at 88 percent of its original power-generating capacity.
This low level of degradation is reassuring. But basic maintenance procedures should still be followed, to ensure your solar panel array will keep on working at close-to-peak efficiency.
Basic solar panel maintenance procedures
Dust and debris can accumulate on solar panels over time. This is especially true if you live in a dry climate where rainfall is rare, or if you live in a location where air pollution is significant and can cause greasy buildup. In one study in Spain, it was found that accumulating dust during drought conditions could decrease solar panel performance efficiency by up to 20 percent .
In most instances, cleaning the surfaces of your solar panel with mild soapy water and a soft brush or squeegee every three months or so should be good enough to prevent any unwanted accumulation of dirt or dust. They can be rinsed with clean water after the cleaning is complete, and you’ll want to make sure you stay clear of the underside of the panels to prevent any contact with wiring or cables.
You should always check your solar panels after storms or high winds, to see if anything has fallen on them, settled on them, or blown across them. Should you see the slightest sign of scratching, cracking, or other damage, contact a solar technician to arrange for an immediate inspection.
Basic maintenance may not require outside assistance. But the best way to make sure your solar energy system remains in top working condition is to let your solar contractor dispatch trained technicians to handle the majority of your maintenance procedures.
These experts are highly trained and experienced enough to evaluate, maintain, and repair each element in a solar energy system. If you enroll in a solar maintenance plan for a reasonable fee, you can be assured they will visit regularly to inspect your equipment and supporting infrastructure .
If gaining access to your rooftop is at all problematic, and you are not able to manage even basic maintenance procedures safely, a long-term solar maintenance plan is undoubtedly your best option.
Maintenance and replacement of solar inverters
Over time, your biggest maintenance and repair-related expense will come when you have to replace your inverter. Solar inverters must convert the direct current (DC) produced by your solar panels into alternating current (AC) for use in your home, and consequently they contain a network of electric components that will wear out from heat stress long before your solar panels are no longer viable.
The expected lifespans for the main types of inverters are as :
- String inverters: 12-15 years
- DC Optimizers: 20 years
- Microinverters: 20 years
- Battery-based inverters (for off-grid systems): 2-10 years
String inverters are the most economical of these options, which is why they comprise the vast majority of inverters currently in use.
If you don’t have a solar maintenance plan that provides such services on a regular basis, you should contract a solar technician to thoroughly inspect your inverter and perform a full diagnostic evaluation sometime within the first 10 years after it has been installed.
Malfunctioning inverters will also reveal themselves through sudden decreases in solar panel power production, and there may also be error messages or warning lights on your inverter or inverters that let you know when problems have developed (many newer models will send error messages to your computer or smartphone through a web interface).
Replacing a string inverter at the end of its lifespan will likely cost you from $2,000 to $3,000 for parts and labor. Initial and replacement costs for DC optimizers and microinverters, which are installed in each solar panel, are likely to be somewhat higher. But they do have longer lifespans and will increase the operating efficiency of your solar panel array .
You can read more about the demands of solar panel maintenance and cleaning and pick up a few additional tips here.
Other questions to ask when buying solar panels for your home
You’ll undoubtedly have many questions you’d like to have answered by a solar contractor or other industry authority, before you commit to the technology and sign an installation agreement.
Here are just a few examples of questions that homeowners frequently ask when they’re considering solar power:
Are ground-mounted solar arrays as good as rooftop panels?
In comparison to rooftop systems, ground-mounted solar arrays are more costly because they require more labor to install and more parts, pieces, and sections to connect to your home .
Nevertheless, ground-mounted solar panels can be an excellent alternative if your roof :
- Has a tilt of greater than 40 degrees
- Is made of wood or slate
- Is excessively shaded with trees or buildings that can’t be removed
- Has less than 300 square feet of open and unobstructed area
A 2018 study by the National Renewable Energy Laboratory (NREL) concluded that about 57 percent of residential buildings in the United States had the necessary characteristics to host a full-sized solar panel installation .
Do I need a solar battery for energy storage if I have a grid-connected system?
If your solar array remains connected to the grid, you can usually qualify for net metering credits that create a favorable balance of payments on the grid energy you purchase. In this situation, you’ll have no need to include battery storage with your system.
However, if you live in a state that offers reduced or wholesale rates in place of full-value net metering credits, you’d be better off storing your excess energy in a solar battery and using it yourself, rather that diverting it to the grid .
If you should ever decide to go completely off-grid, you’ll absolutely need to have battery storage for your system, since solar panels can’t produce electricity 24 hours a day.
Are solar leases and Power Purchase Agreements (PPAs) a good way to take the leap into solar?
As an alternative to purchasing solar panels, you can contract a third-party to install them for you, with no money down required. Under these arrangements, you won’t own the panels outright, but will still have the right to purchase the power they produce for a set monthly fee (solar lease) or sliding fee based on consumption (PPA) .
These plans will offer some savings in comparison to your normal utility bills. But you’ll never actually own your solar panels and will therefore never enjoy the benefits associated with a direct solar panel purchase. The company that owns the panels will cash in on the rebates, tax credits, and SRECs, which makes a leasing or PPA arrangement vastly inferior to a cash purchase or loan-financed purchase in the long run.
Over a 20-year period, you’ll save one-and-a-half times more on utility bills with a financed solar panel purchase, and two-and-a-half times more if you buy your solar panels outright with cash .
Do you really need to purchase more solar panels as a “cushion” for power deficits?
If you plan to install a grid-connected solar energy system, or purchase and install a home battery system to store excess solar energy for later use, you are unlikely to need extra solar panels beyond the recommended level. As long as you have excess ground or roof space, you could always add a panel or two later if necessary.
The one exception to this advice is if you know you’ll be remodeling or renovating in the near future. This could increase your daily demand for electricity and require a more expansive solar array.
In general, it’s an advantage to have unused roof or ground space after an installation is complete, since this will allow you to add more panels later if your current system proves inadequate for any reason.
How will having solar panels installed affect my property values?
Research reported by the U.S. Office of Energy Efficiency and Renewable Energy shows that adding solar panels to your home can increase its value by $15,000 at the time of purchase .
To fully enjoy this benefit, however, it is important that you don’t still owe money on a solar loan while you’re trying to sell. This can scare off potential buyers who worry you’ll abandon your obligations and refuse to pay back your loan once you’ve moved out of the home, leaving them in a sticky situation.
Selling a home if you’ve acquired your solar panels via solar lease or Power Purchase Agreement can be equally difficult. Experienced real estate agents report that potential buyers are generally loathe to purchase homes with leased solar panels, since they’re unsure of what their rights and responsibilities are and what the ultimate financial ramifications might be .
This short list of queries is just to get you started. You can find more inspiration about important questions to ask here, in this extensive review of the solar panel buying process.
Are you ready for solar? It is definitely ready for you
Solar energy is a rising force in the residential energy sector. Solar generation of all types is projected to comprise 48 percent of all renewable energy generation in the United States by 2050, which is a testament to the beneficial economics of this emerging technology .
Right now, solar panel arrays are spouting like sunflowers on rooftops and lots across the American landscape. If you join the solar movement, you’ll be adding your name to the rolls of a growing club of solar enthusiasts, who are doing their part to save the planet while also enjoying significant savings on their utility bills.
Solar is a virtuous technology, and its virtues make it an easy sell to consumers who are paying attention.