Why Are Solar Panels So Expensive?

Solar panels have seen an increase in popularity over the last decade. You may have spotted a few panels on the roofs of homes that you have driven by. It’s the high-cost installation that removes it as viable options for most families.

Why are solar panels so expensive? The main material used in solar panels is Silicon. Even though this material is very common, the process it undergoes will require a lot of energy. There are very few factories that work in refining silicon in this way, which leaves a very limited supply available for the consumers.

Many methods are being researched to help replace Silicon in many items. With this, we would be able to cut the cost of the panels themselves and making solar panels a more viable solution for everyone. Some states even allow the opportunity for you to get these installed as well as maintained for free.

What Affects The Cost Of Solar Panels

The cost of the solar panels aren’t going to be just by how many watts you need. But expect to pay heavily for each watt that you need. Prices from $8-$10 a watt are very common and will quickly add up. If you are thinking about purchasing solar panels, then consult this list to understand where the money is coming from

It’s In High Demand But Low Supply

Like we stated earlier in this article, there aren’t very many companies that are able to refine the silicon like its needed. Because of this, they are able to charge a pretty penny. This won’t be a long time thing, as more and more people are understanding the benefits from solar panels

How Much Power Do You Need?

Powering up a bigger home is not as easy or cheap as it is a smaller one. Your solar panel is going to be responsible for powering all of your basic amenities like ovens and refrigerators. You may not be able to afford the entire setup and might still see a check from your power company. The panels can help you cut these bills back overtime.

Where Do You Live?

Your solar panels are going to be able to generate a much greater amount of power if you live in an area that is consistently basking in the sun. Think places like Arizona to get a good idea. If you live in an area that sees constant rainfall, then you will not have enough solar energy for your panels.

Avoid paying too heavily for your panels. Like many other websites that compare ratings or things like hotels, you can find a few of them dedicated to nabbing a few solar panels for a much cheaper price. This is also made easier by many plans that companies give to their consumers, and there are even tax breaks involved if you throw up a few panels.

How Much Does Solar Installation Cost?

As of the time of writing, the national average for a single watt is anywhere from $2.99 and up. That means for a single 6kilowatt system on your roof. You could be paying around $12,558 after taxes. For a 10kilowatt system you’ll be facing a heftier price tag since you are asking for a bigger system and in turn, more labor to get it set up.

You will have a tax program that can help you cut off 30% of the overall cost. This program is known as the ITC and uses its deductions with the solar tax credit. This may not be the only aid you will see as many states and local governments will also offer you a rebate for the panel as an incentive to go green.

Prices Of Solar Panels By State

Solar panels don’t come with a fixed price, and you’ll find that some states may charge more for them. The table below should give you a good idea on what each state is offering in terms of prices;

State6 Kilowatt10 Kilowatt
Arizona$11,466 – $14,238$19,110 – $23,730
Georgia$11,508 – $12,852$19,180 – $21,420
Colorado$11,970 – $14,490$19,950 – $24,150
Delaware$11,802 – $12,810$19,670 – $21,350

It should be noted that these prices are after the 30% deduction. The main point of this table wasn’t to show you just what states offer the best price, but to show you that the average price for the panels is dropping each year, and with more people jumping on board, it will continue to do so.

How Long Does It Take For Them To Pay For Themselves?

If you are looking to have your solar panels save you tons of money in just a few months, you won’t see very much value in them. These panels take anywhere between seven to twenty years to see you make savings from your local power company. Even with discounts from states that could see the price be as long as $5,000 will still mean that it will take time to make any serious savings possible.

You do have the potential to save over $20,000 after twenty years, and the solar panels will only add more value to your home over time.

Can I Install Them Myself?

While you could potentially install the system yourself, it’s much better to leave the wiring and metering to a trained professional. Hooking up a solar panel to an electrical grid is not a walk in the park, and a single mistake could be fatal. There are many smaller versions of solar panels that have 120v’s of power in them, which is around the average number for small household appliances, and do not require a professional to install them.

What Are The Potential Dangers?

Installing solar panels can be a very hazardous job. Because of this, many installers are protected by many standards that are enforced by OSHA. One of the more serious threats to installers can come in the form of arc flashes that can severely burn them. Aside from this, they are also susceptible to

  • Falls
  • Electrical Hazards
  • Cold/Heat Problems

You can see why it is advised to leave the work to the professionals if the section above didn’t convince you well enough. 

How Long Do Solar Panels Last?

Solar panels on average can last anywhere between 20-35 years. This means you aren’t going to have to drop another payment in ten years when your panels don’t work. That doesn’t mean that the panel is going to stop working entirely, but that the amount of energy produced will be below the industry standards.

If your panels are cleaned regularly from debris, or not physically damaged by them in any way, then they could last your for a few decades before replacements even come to mind.

How Fast Do They Degrade?

According to the National Renewable Energy Laboratory, solar panels degrade at 0.8% each year. The rate is known as “Solar Panel Degradation Rate”. This isn’t an industry standard as manufacturers like SunPower have panels that degrade at a rate of 0.3% each year, which doubles the life-time of the panel.

This means that over a two-year span your panel could be functioning 99.2% of its original output. At 30 years your panel will be producing only 82.5% of its original power. Your panels will come with warranties that will cover this topic in length and will even give you an estimation when the panels won’t work as well.

These warranties will cover both equipments to help cover costs in case of accidents, and performance to ensure that your panel is producing the required amount. Your warranty will cover a 25-year period.

See my “How much to solar panels degrade each year” article for more information on this subject.

Can You Make Them Last Longer?

Solar Panels are extremely durable, so don’t expect them to be as fragile as cardboard by any means. Many panels are tested for high-wind conditions and even snow loads to make sure they are able to maintain peak performance in many situations. Constant maintenance isn’t even necessary since they have no moving parts.

There aren’t any crazy methods to keeping your panels going after its life-span. The more you clean it and make sure it’s maintained, the slower the degradation rate will be.

How Often Should You Service Them?

Solar Panels aren’t going to require your attention every week. As long as you clean off your panels every six months, then they should continue producing as much power as they can. If you live in areas where it snows frequently, then you may find yourself up on the roof more often.

Do Solar Panels Increase Home Value?

Solar panels can greatly increase the value of your home. There are many things that can help factor in how much your home is worth after placing these on your roof, and they include

The Location Of Your Home Even though the prices of the solar panels may not vary so much from state to state, the housing market they see can be extremely different. States that have active solar markets (like New Jersey) will often see a huge increase in home value

How Big Is Your System?

The more money you spend into your system then, the more you will get out of it in the long-run, this goes double for the value of your home. Every dollar that you save in energy can take on another twenty dollars in your homes overall value.

How Much Is Your Home Worth?

It’s no surprise that a bigger house is going to see a higher selling price. If you live on golf-course property and tack on a few panels you can see huge returns that could potentially pay off your next homes installation.

A medium-size home that has a 5kilowatt system can see as much as $29,000 added on to their house value, and even help sell your home up to 20% faster. Keep in mind that these are according to the housing and utility rates as of writing.

Advantages Of Solar Panels

Don’t let the cost of the panels dissuade you from ever using them. There are many ways you can benefit from having a few solar panels on your roof.

It’s The Cleanest Version Of Energy Around

We rely on fossil fuels to get the energy our cities need. When we burn them, they give off toxic chemical compounds such as carbon dioxide and carbon monoxide. Over time this has lead to an increase in temperature after the chemicals created a hole in the ozone layer.

This is partially why solar energy comes to the minds of many when asking for a better resource for energy. It only takes in solar energy and doesn’t rely on using any sort of fuel to power a mechanism to provide power. Its power source is virtually infinite, and since no-one on Earth owns the sun, it’s also tax-free.

It’s Renewable

Like we stated in the last point, the sun helps give off an infinite amount of energy. That is unless you find yourself 5 Billion years in the future, in which one of the last things you’ll need is a solar panel. These panels are fitted by photovoltaic cells, which is a specialized device that converts visible light into power.

Variety Of Uses

Solar panels are mostly shown powering up homes and small sites. You may be surprised to learn that you can also use these panels for help with

  • Powering Vehicles
  • Powering Airplanes
  • Cooking
  • Calculators

Helps The Wildlife

We leave a lot of animal species homeless whenever we go after fossil fuels. The usage of them greatly damages the wild-life and the temperatures in every reason. You won’t burn any toxic materials or harm any wildlife when you use a solar panel. This is because you are getting your energy directly from the Sun and allowing ecosystems to thrive again.

Disadvantages To Solar Panels

Solar panels can be effective for keeping your savings in your pocket when it comes to long term usage. It isn’t perfect, and it’ll oftentimes come with disadvantages that you may think won’t make it worth the hassle.

Low Efficiency

Solar panels are only able to convert 15-22% of the solar energy they receive into electrical energy, which means in order to power your home you may need to cover a section of your roof with them. You might find that it is impossible to not use the local power companies at some point, but the solar panels can come back on the cost.

 Maintenance

Get rid to climb up on your roof for at least once a year. You may not have to fix your panels as much as you would your car or washer, but you will have to make trips to the top of your roof to clean the panels off. Wind can kick up dust and debris that will prohibit your panel from gaining as much power as possible. You will also have to cut down limbs from trees that provide shade on your roof.

It Depends On Sunlight

This factor seems obvious, but how much sunlight it needs takes certain areas off the table completely. If you live in the North, where it’s colder and sees a high amount of rain, then solar panels just aren’t viable. Take into account that it only converts a small amount of solar energy, and you’ll begin to see why much warmer climates are best.

You’ll Pay Upfront

Remember that you are going to be paying anywhere from $3-$10 a watt, and ask yourself how many panels you’ll need to power up your home. You can see why this would put a huge dent in your wallet for the installation. Many companies do offer zero down payment plans that can lighten the stress on your wallet.

Can I Get Solar Panels For Free?

It is not uncommon for someone to be able to get their hands on a system of solar panels for absolutely no cost. It sounds as if its something Billy Mays himself came up with, but it’s the direct result of solar leases and power purchase agreements.

You are able to have the system installed, and even monitored by the company if you lease out the system over a set amount of time. The typical timelines for this agreement ranges from 20-25 years and during that time you are only paying half of your current utility bill depending on where you live. This means the second its installed, you’re saving money and keeping your charges low.

How do they make back their money? They do this by giving you incentives along with rebates and keeping their profits non-existent when it comes to metering.

Why Does This Happen?

In many states, these power companies are faced with clean energy requirements that make them comply with clean air policies. This has led many states to have what is known as a Renewable Portfolio Standard (RPS) which sets a certain amount of renewable energy that a power company must produce in order to avoid paying fines. This leaves the company with a reason to install the solar panels for free, and promote renewable energy.


Title image by Greens MPs

spgenie

Hi I'm Harris the spgenie! As an engineer, I found myself doing tons of research about solar power, the types of panels, how to store the energy and the best way to finance the project. I thought I'd start this blog to share my findings. I hope you find this useful.

Recent Content