How Much Do Solar Panels Cost in 2025 ? It's Usually Worth It

Published: February 2025

Solar panels cost $21,816 on average when purchased with cash or $26,004 when financed with a loan. While the upfront costs of solar are high, the electricity bill savings you get from solar power recoup the upfront costs in just about 10 years on average, making solar a worthwhile investment for most homeowners.  

There is a lot to consider when it comes to solar panel costs, and each situation is unique. This guide explains everything you need to know about solar power costs, including factors that impact pricing, ongoing system costs, and how to make going solar cheaper. 

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Use this calculator to find out how much solar panels cost for your specific home

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How much do solar panels cost in 2025?

An average 7.2 kW solar panel system costs $21,816 before incentives or $3.03 per watt of solar installed. The federal solar tax credit lowers solar system costs by $6,544, bringing the price down to $15,271.

System Size	Total solar panel cost	Solar panel cost after federal tax credit	Solar panel cost per watt (cash purchase)	Solar panel cost per watt (financed)
4 kW	$14,560	$10,192	$3.64	$4.37
5 kW	$16,800	$11,760	$3.36	$4.03
6 kW	$19,140	$13,398	$3.19	$3.83
7 kW	$21,490	$15,043	$3.07	$3.68
8 kW	$23,840	$16,688	$2.98	$3.58
9 kW	$26,280	$18,396	$2.92	$3.50
10 kW	$28,600	$20,020	$2.86	$3.43

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How much are solar panels in each state?

Solar panel costs vary by location, mostly due to differences in labor and permitting costs, and what the existing market for home solar panels is. We found that the cheapest state for solar is Oklahoma, while the most expensive is North Dakota. 

By analyzing data from the National Renewable Energy Laboratory (NREL), The Bureau of Labor Statistics, and the U.S. Energy Information Administration, we compiled an accurate list of the average price of solar panels in each state.

State	Total solar panel cost	Solar panel cost (after federal tax credit)	Average solar panel cost per watt
Alabama	$24,651	$17,256	$3.23
Alaska	$24,069	$16,848	$3.14
Arizona	$21,195	$14,837	$2.77
Arkansas	$20,575	$14,403	$2.70
California	$23,971	$16,780	$3.14
Colorado	$23,327	$16,329	$3.05
Connecticut	$22,282	$15,597	$2.91
Delaware	$22,892	$16,024	$2.99
District of Columbia	$25,513	$17,859	$3.34
Florida	$20,747	$14,523	$2.71
Georgia	$23,364	$16,355	$3.06
Hawaii	$21,579	$15,105	$2.82
Idaho	$22,693	$15,885	$2.97
Illinois	$24,023	$16,816	$3.15
Indiana	$25,087	$17,561	$3.29
Iowa	$22,244	$15,571	$2.90
Kansas	$23,817	$16,672	$3.12
Kentucky	$20,955	$14,669	$2.75
Louisiana	$23,134	$16,194	$3.03
Maine	$24,121	$16,885	$3.16
Maryland	$23,035	$16,125	$3.01
Massachusetts	$23,981	$16,787	$3.13
Michigan	$25,494	$17,846	$3.34
Minnesota	$22,967	$16,077	$3.00
Mississippi	$21,793	$15,255	$2.86
Missouri	$22,361	$15,653	$2.93
Montana	$22,188	$15,532	$2.90
Nebraska	$22,306	$15,614	$2.92
Nevada	$21,745	$15,222	$2.85
New Hampshire	$23,178	$16,225	$3.03
New Jersey	$24,127	$16,889	$3.15
New Mexico	$21,730	$15,211	$2.84
New York	$25,270	$17,689	$3.30
North Carolina	$23,492	$16,444	$3.08
North Dakota	$26,268	$18,388	$3.44
Ohio	$22,209	$15,546	$2.90
Oklahoma	$20,031	$14,022	$2.62
Oregon	$22,945	$16,062	$3.00
Pennsylvania	$24,137	$16,896	$3.16
Rhode Island	$22,482	$15,737	$2.94
South Carolina	$23,687	$16,581	$3.10
South Dakota	$21,766	$15,236	$2.85
Tennessee	$22,372	$15,660	$2.92
Texas	$21,688	$15,182	$2.84
Utah	$23,052	$16,136	$3.02
Vermont	$23,584	$16,509	$3.08
Virginia	$23,055	$16,139	$3.02
Washington	$24,403	$17,082	$3.19
West Virginia	$22,344	$15,641	$2.93
Wisconsin	$22,866	$16,006	$2.99
Wyoming	$24,041	$16,829	$3.15

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Are the upfront costs of solar panels worth it?

Solar panels are a great investment for most homeowners. Solar panels generate electricity at a rate much lower than what your utility offers. 

Think of it this way  — the cost of installing solar panels is like paying for all of your electricity bills for the next 25 years in advance at a discounted rate. While the effective cost of installing solar power is about $15,200, your electricity bills for the next 25 years would cost you over $60,000! Clearly, solar power is the cheaper option. 

Usually, solar panels pay for themselves in about 10 years, sometimes even less, depending on where you live! With that sort of payback period, you can get at least 15 years of free solar power to run your home.

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6 factors that impact how much solar panels cost to install

How much your neighbor spends on solar won't be the same as what you do! Solar panel costs are unique to you and your home's energy needs, and they can vary by six main factors.

1.  Energy bills

Energy consumption plays the biggest role in how much a solar installation will cost. The amount of energy you use determines how many solar panels you need. The higher your electricity usage, the more panels you need to install, and the more expensive the installation will be. The table below shows how much solar panels cost on average to cover different electricity bills:

Electric bill	Solar panel cost	Solar panel cost after tax credit
$135	$16,968	$11,878
$170	$20,604	$14,423
$205	$25,452	$17,816
$240	$29,088	$20,362
$270	$32,724	$22,907
$300	$37,572	$26,300
$340	$41,208	$28,846

Assumes average cost per watt of $3.03

2. System size

The system size you need determines how much you end up paying for solar. Larger systems will cost more money in total, but the cost per watt will often be a bit lower as soft costs are distributed across more total watts. You can think of this like buying a bulk package of paper towels — the total cost of your purchase is higher than if you bought a regular package, but the cost of each roll is lower. 

3. Solar equipment

The solar equipment you install impacts the final price of a solar system. For example, if you choose premium efficiency panels, you could spend 25% more on the installation but might see better utility bill savings because of additional energy production. Here are a few factors that will impact the cost of solar equipment:

• Performance: Solar panels with high power output or efficiency ratings often come at a higher price point because they can produce more energy. Premium efficiency solar panels can cost up to 25% more than standard efficiency models. 

• Equipment and solar panel type: Different technologies will have different costs. For example, string inverters cost less than microinverters but often have shorter warranties and need to be replaced before the end of the system’s life. Also, opting for equipment like solar shingles as opposed to conventional solar panels will increase costs.

• Additional equipment: You can pair your solar panels with battery storage to maximize the amount of solar power your home uses and have a source of backup power in case of a power outage. However, batteries will increase overall costs, usually by upwards of $15,000. 

4. House and roof characteristics

Home solar panels are generally installed on rooftops, so the system’s design largely depends on the roof’s characteristics. Complex roofs with multiple faces, dormers, vents, or skylights can increase installation and design labor costs, but they may also limit the number of panels you can install. 

The best direction for solar panels is south-facing roofs, but if your roof faces another direction, you may need to install more panels, increasing your total costs. You may also need a bigger system if your roof gets shaded throughout the day. Even how many stories your home is can directly affect the labor required to install the system.

5. Location

Where you live is another important factor to consider when thinking about solar panel costs, and it can impact the price tag in a few ways:

• Sun exposure: Solar panels generate more electricity in sunnier states, so fewer solar panels are needed to meet household energy needs, leading to lower overall costs.

• Labor costs: The cost of labor is different across states and will dictate the final price of going solar. 

• Permitting and inspection costs: Each town and utility has a different set of rules when it comes to the permits and inspections needed for a solar installation, which can make solar slightly more or less expensive compared to neighboring areas.  

6. Installer

How much each solar company charges for a solar installation is different. It can depend on how their business is structured, the margins they need to meet, and the equipment that they use. Because there can be such a large variation in the price charged by installation companies, you should always get quotes from at least three different installers. 

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Solar panel installation cost breakdown: What are you paying for?

When you install a solar energy system, you’re getting more than just solar panels on your roof. Multiple pieces of equipment, such as racking, wiring, and inverters, must be installed so the solar panels can power your home. You also have to pay for the labor to design and install the solar system; installation labor costs just about $1,200 for an average solar power system. 

The following table breakdown how much different components of a solar installation cost for an average 7.2-kilowatt solar installation:

Item	Percentage of Cost	Average cost for 7.2 kW system	Average cost per watt
Solar panels	12%	$2,618	$0.36
Inverter	11%	$2,400	$0.33
Racking	8.50%	$1,854	$0.26
Electrical	9.50%	$2,073	$0.29
Labor	5.50%	$1,200	$0.17
Permitting inspections	3%	$654	$0.09
Customer acquisition	15%	$3,272	$0.45
Soft costs	19.50%	$4,254	$0.60
Profit	16%	$3,491	$0.48
Total	100%	$21.816	$3.03

• Solar panels and other equipment: Believe it or not, solar panels make up just 12% of total installation costs on average, with one solar panel costing about $200 before installation costs are considered. The cost of the solar equipment installed will vary with the performance, quality, and brand.

• Soft costs: Solar soft costs are any costs that aren’t associated with the physical materials used in the system. Solar soft costs include permitting, inspection, system design costs, and installer overhead and profit.

• Labor costs: Labor costs vary widely based on location, but they can also be impacted by the design of your system. The more complex it is, the more resources it may require to get up and running.

Additional solar panel costs 

There may be additional costs you pay for when you go solar, dpeenidng on your installation and design. Here are some common added costs:

• Electrical panel upgrade: Not all homeowners need to get a new electrical panel when they go solar, but if you live in an older home or your breaker box is too small, you may need to get an upgrade. Depending on the project, an electrical panel upgrade for solar could cost between $2,000 and $3,000.

• Roof replacement: Solar panels should be installed on roofs that are no more than 15 years old. This won’t be an issue for every homeowner, but if you really want solar and your roof is getting old, roof replacement costs are something to consider.

• Battery storage system: Paring solar panels with energy storage is a great way to maximize the amount of clean energy your home uses while providing you with backup power. Solar batteries cost about $15,000 minimum, but the peace of mind is worth the price tag for some homeowners. 

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4 ways to save on solar panel installation costs

Solar installations are expensive, but there are a few ways to save money when you go solar, including:

• Incentives and rebates

• Undersize your system

• DIY solar installations

• Getting multiple quotes

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Solar power system cost by house size

On average, solar panels cost about $9.34 per square foot of your home’s total living space. This means solar panels will cost about $13,075 for a 2,000-square-foot house, including the solar tax credit. 

Note: Using square footage to estimate home solar system costs only offers a rough guide and will not provide a truly accurate price. Installers will not use cost per square foot. The best way to figure out solar panel costs is by looking at your energy usage and the system size needed.

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Long-term solar panel installation costs to consider

While the initial price of going solar is the biggest expense you’ll pay, there are some costs that may come up over the 25-year lifespan of your solar panels

Solar panel maintenance costs: $0 - $300 per year

Solar panels have no moving parts, so very little maintenance is required. However, getting routine professional solar panel cleaning and inspections every two years can keep your system in tip-top shape. These solar maintenance costs can be about $300 per session, but they are optional.

Financing fees and interest rates: 5.99% - 9.99% APR 

If you purchase your solar panels with a solar loan, you’ll have to pay interest on the loan. Most solar loans today have an interest rate between 5.99% and 9.99%. You’ll make interest payments each month for the duration of your solar loan term.

Inverter replacement: $1,500

If your solar system uses a string inverter, it may need to be replaced. String inverters generally last between 10 and 12 years, while solar panels last for 25 years or more. Getting a new string inverter could cost about $1,500.

Solar panel repairs: $200+

Solar panels are extremely durable, and a National Renewable Energy Laboratory study found that solar panel failures are incredibly rare, but just like with any purchase, your solar panels may require repairs in the future. In the unlikely event this happens, the issue may be covered by a solar warranty.

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How to pay for home solar panels

There are three main ways to pay for solar panels that can make going solar more cost-effective:

• Purchase with cash: Cash-purchased solar systems are usually the cheapest option and provide the best long-term solar savings. But, it does require a large upfront payment.

• Use a solar loan: Solar loans let you pay for solar in monthly installments, but the total costs tend to be higher than cash systems because of interest payments and dealer fees that add an average of 43% to the total price you end up paying.

• Get a solar lease or power purchase agreement (PPA): Solar leases and PPAs require no money upfront. Instead of buying the solar panels, you pay for the energy they produce. You don’t own the system, so the savings tend to be lower than leases or loans and you don’t directly benefit from solar incentives, but you don’t have to worry about maintenance costs.

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How much does a solar panel cost?

A singular solar panel will cost anywhere from $150 to $300, depending on the kind you buy. A regular home photovoltaic panel costs usually around $200, while premium solar panels inch closer to $300. Portable solar panels for camping trips or to charge a solar generator can be $150 or lower, but depending on the power output, they can reach $400. 

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5-step solar panel cost calculator

There is a lot to consider when figuring out how much you’ll spend on a solar installation. Here are five steps to help you calculate how much a system will cost to install for your home:

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Use this solar panel cost calculator to find out how much solar will cost for you based on recent installations in your area

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Why you can trust SolarReviews solar panel cost data

SolarReviews’ data analytics team has a rigorous calculation methodology to get the most accurate solar panel pricing data possible. Unlike other websites, we don’t just rely on internal data, as that can be skewed by our installer partner base. 

Instead, we cast a wider net and analyze cost data from the most trusted government agencies, like the National Renewable Energy Laboratory, the Bureau of Labor Statistics, and the U.S. Energy Administration, which represent real prices homeowners across the nation pay. 

The result is a detailed look at how local labor markets shape the average cost of solar panels in each state.