Q: How much do solar panels cost?

The most common benchmark to evaluate solar cost for a "cash" solar project is the fully installed cost per watt. The formula is simple.  fully installed system price divided by the total system size DC.  For example, if an 8 kW DC system costs $24000, then we divide $24,000 by 8000 to get $3/watt.

According to EnergySage, the average national solar panel cost for a residential solar panel installation is $3.14/watt with a range of $2.71 to $3.57/watt depending on system size and equipment configuration.

Okay, but what do solar panels cost in new jersey?  National Renewable Energy Laboratory (NREL) completed a study indicating that the the average cost per watt in 2017 was $2.96 for systems installed in New Jersey --- again with a plus or minus 20% or so --- to account for differences in equipment configurations.

Factors impacting the cost of you solar panel system

When we prepare your solar quote it will contain the all-in price that you’ll be expected to pay when you install a solar energy system on your roof. As you start to explore solar offers for your home, you’ll notice that there are pricing variations between installers and there are many factors that make up the cost difference in these quotes. 

The actual cost of a solar panel system will depend a number of things: Equipment options, such as solar panels, inverters, and mounting system... along with the design, engineering, operations, and installation costs.

If we just look at the equipment component, you will see that more efficient equipment comes with a higher price tag. More efficient, higher-quality equipment comes with benefits that may be worth the added cost since the hardware can produce more electricity with the same amount of sunlight, and often comes with a more comprehensive warranty, too.

For example, solar panels can make up 16 (Trina Panels) to 28% (LG Neon 2 Panels) of the solar installation cost depending on the brand... plus there are all sorts of inverters and mounting systems to choose from... and each category of equipment may have a different price and warranty.

The other thing that will impact your total cost is how efficient your house is. A home that is facing due south with very little shade will require around 20% less panels to produce the same energy as a home facing east with very little shade.

The Residential Renewable Energy Tax Credit

Once you establish the "gross" cost per watt if the system, you need to determine if you can take advantage of the Residential Renewable Energy Tax Credit that entitles  a taxpayer may claim a credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the United States that is owned and used as a residence by the taxpayer (for systems put in service before December 31, 2019).  Effectively, this provides you with a 30% discount on the cost/watt we have been discussing thus far.

The Benefits & Costs of Financing Your Solar Panel System

Lets face it, most of us don't have $24,000 sitting around under our mattress...  So, low interest financing is a great alternative.... and, depending on the loan term that you choose, you should start saving within the very first year.

If you elect to finance your solar panel system, we need to consider the impact of interest and loan term on your total cost. We call this metric the Fully Installed and Financed Cost per DC Watt.

Let's revisit the $24,000 installation that we discussed above.  Assuming that you receive the full 30% tax credit, you will only need to finance 70% of the system price or $16800.  

Example 1: If you finance this system for 10 years at 2.99% interest, your loan payment will be $162.4/month X 120 months = $19,467.32. Now divide this by 8000 DC watts to come up with a true cost of $2.43 / watt.

Example 2: If you finance this system for 20 years at 4.99% interest, your loan payment will go down to $110.77/month X 240 months = $26,587.14. Now divide this by 8000 DC watts to come up with a true cost of $3.32 / watt.

We offer over 120 different loan combinations, ranging from 12 months to 20 years from a variety of different lenders, so we can easily help you find the best solar financing option for your specific situation.  

Please click on Get an Estimate for details on how much "going solar" can save you. 


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