Solar Panel Cost
The cost of solar panels has declined dramatically over the last several decades and, with a sharp rise in utility electricity rates in 2022, home solar now offers more cost savings potential than ever before.
In fact, the 2023 Heatmap Climate Poll found that 46% of US adults want to power their homes with solar panels in the future while 13% already do.
So, what’s standing in the way of American homeowners and solar panels? The biggest hurdle is often the cost of solar panels. And like a monster in a horror movie, the cost of solar panels is far less intimidating once you shine some light on it and understand how it works.
In this article, we’ll explore:
As always, our goal is to give you the resources and knowledge to make educated decisions during the solar process.
Is the price of solar panels falling?
The price of solar panels has declined substantially over the last decade as the industry has matured and reached production at the largest global scale.
Since 2010, solar panel have fallen by roughly 90% while global solar deployment has grown by over 400%, and this incredible growth rate along the entire global solar supply chain has dramatically reduced prices.
Just like computers, big-screen TVs, and cell phones, the economies of scale that solar panels now enjoy have produced a dramatic cost curve that has fundamentally changed the energy industry.
Utility-scale solar installations are now cheaper than all other forms of power generation in many parts of the world and will continue to replace older, dirtier power plants run on coal and natural gas.
Additionally, homeowners are now able to own their power production more cost-effectively than ever before.
Price per Watt vs cost per kWh
There are two main ways to calculate the cost of a solar system:
- Price per watt (/W) is useful for comparing multiple solar offers
- Cost per kilowatt-hour (cents/kWh) is useful for comparing the cost of solar versus grid energy
Let’s dive a little further into each measurement.
What is solar price per watt?
A fully installed solar system typically costs 3 to 5 per watt before incentives like the 30% tax credit are applied. Using this measurement, 5,000 Watt solar system (5 kW) would have a gross cost between 15,00 and 25,000.
Price per watt for larger and relatively straightforward projects are often within the 3-4 range. Claiming incentives like tax credits and rebates can bring the PPW even lower.
However, the following factors may push your solar price per watt into the 4 to 5 range.
- Smaller system size
- Unusual roof material or layout
- Premium panel and inverter models
- Multiple arrays versus a single array
- Additonal work like panel box upgrades, trenching, or roof repair
How to calculate solar price per watt
Calculating the price per watt for a solar system is very straightforward — it’s simply the system cost divided by the number of watts in the system.
Price per watt (/W) allows for an apples-to-apples comparison of different solar quotes that may vary in total wattage, solar panel brands, etc.
Pro tip: It can helpful to know your solar price per watt before and after claiming the 30% tax credit.
Ultimately there are many factors that figure into the price per watt of a solar system, but the average cost is typically as low as 2.75 per watt. This price will vary if a project requires special adders like ground-mounting, a main panel upgrade, EV charger, etc.
| Solar Price Per Watt | Solar Price Per Kilowatt-Hour |
| GROSS system cost / Total system wattage | NET system cost / Total lifetime system production |
| Useful for comparing solar quotes against one another | Useful for comparing solar versus utility bill |
| Pertains to the POWER of a system | Pertains to the PRODUCTION of a system |
| Typically 3.00-4.00/watt | Typically 0.06-0.08/kWh |
Cost Per Kilowatt-Hour (kWh)
Another measure of the relative cost of solar energy is its price per kilowatt-hour (kWh). Whereas the price per watt considers the solar system’s size, the price per kWh shows the price of the solar system per unit of energy it produces over a given period of time.
Net cost of the system / lifetime output = cost per kilowatt hour
You may also see this referred to as levelized cost of energy (LCOE).
What is a kWh?
A kilowatt-hour is a unit of energy and is equivalent to consuming 1,000 watts – or 1 kilowatt – of power over one hour. For reference, an energy efficient clothes dryer uses around 2 kWh of electricity per load, while central air conditioning uses around 3 kWh per hour.
While price per watt is most helpful comparing the relative costs of solar bids, solar energy cost per kWh is best used to illustrate the value of solar relative compared to buying your power from the electric utility.
For example, the average cost of a solar system purchased through solar.com is 6-8 cents per kWh, depending on the size of the system, type of equipment and local incentives.
Let’s compare that to grid electricity in major metro areas for April 2023 to the average cost per kWh of home solar energy:
| Grid electricity (cents/kWh) | Solar.com electricity (cents/kWh) | |
| New York City | 21.6 | 6-8 |
| Chicago | 18.0 | 6-8 |
| Miami | 16.8 | 6-8 |
| Houston | 15.2 | 6-8 |
| Denver | 15.2 | 6-8 |
| Los Angeles | 26.9 | 6-8 |
| Seattle | 12.7 | 6-8 |
Based on this prices, it costs around 43 cents to dry a load of laundry using grid electricity in New York and only 14 cents to dry a load using solar power.
How do I calculate the cost of solar panels?
There are a few ways to get a rough estimate for how much solar panels will cost without sitting through a sales pitch. These include:
- Online calculators
- Hand calculations based on your electricity usage
- The average cost of solar panels for comparable homes
Let’s start with the quickest method: online calculators.
Using a solar panel cost calculator
First, you can use an online solar cost calculator, like this one powered by solar.com. Simply punch in your address and your average monthly electricity bill, and the calculator will give you a side-by-side comparison of the cost of solar versus paying for utility electricity.
But before you use any solar panel cost calculator, it’s important to understand that there are dozens of variables that affect the cost of solar panels, and solar calculators work by making assumptions about those variables.
For example, your solar savings depends largely on how much utility rates increase over 25 years. Most calculators assume 3-5% annual inflation based on historical averages – but nobody can know for sure where will go over the next 25 years.
Solar savings is also geographically sensitive, since every state has different incentives, electricity rates, sun exposure, and net metering policies.
For example, a solar panel cost calculator for California would have drastically different assumptions than a cost calculator for New York.
How to calculate the cost of solar panels by hand
If you’d rather make your calculations offline, there are a few simple steps to estimate the cost of your solar system based on your electricity usage.
- Dig up some recent electricity bills (the more the better!)
- Average them together to get a baseline for your monthly electricity consumption
- Divide your monthly consumption by 30 to get your daily electricity consumption.
Once you have your average daily electricity use, follow the steps in the graphic below. Here are a few tips:
- You’ll have to assume the price per Watt (PPW) you can get from a local solar installer. This typically ranges between 3.50 and 5 before incentives
- Pro tip: Run the high and low PPW scenarios to get a range of solar costs
If hand calculations aren’t your thing, you can get a quick-and-dirty estimate based on the cost of solar for comparable homes.
How much do solar panels cost per square foot?
The third – and least accurate – way to get an idea of how much solar panels will cost for your home is to see how much solar panels cost for homes similar to yours.
Now, we absolutely encourage you to talk to friends, family, and neighbors that have installed solar systems to get a sense of the pros, cons, and cost. However, we’ve done a lot of that legwork for you.
We analyzed thousands of systems sold on solar.com in 2022 to find the average cost of solar panels for homes based on their square footage of living space and number of bedrooms.
On average, solar panels cost 8.77 per square foot of living space, after factoring in the 30% tax credit. However, the cost per square foot varies based on the size of the home.
For example, the post-tax credit cost of solar panels for a 2,500 square foot home is around 20,000 for a rate of 7.96 per square foot.
But how much do solar panels cost for a 1,500 square foot home? The average system cost only drops by 1,000 and the cost per square foot increases to 12.83.
| Square footage of living space | Solar cost per square foot (after tax credit) |
| 1,500 | 12.83 |
| 2,000 | 10.23 |
| 2,500 | 7.96 |
| 3,000 | 7.02 |
| 3,500 | 5.79 |
| Average | 8.77 |
Based on systems purchased on solar.com in 2022. Square footage per Zillow.
If you don’t know your home’s square footage, you can either look it up on Zillow or get a rough estimate using the number of bedrooms.
What’s the cost of solar panels for a 3-bedroom house?
The average pre-incentive cost of home solar is 29,161 for a three-bedroom house, or 20,412 after applying the 30% tax credit.
However, as shown in the chart below, the number of bedrooms isn’t a great indicator of the size and cost of a solar system – and neither is living space, for that matter.
Solar systems are typically sized based on electricity consumption – not square footage or number of bedrooms. That’s because a two-bedroom house with two EVs and an electric heat pump would likely use more electricity than a four-bedroom house with no EVs and gas heating.
So, you can use this method to get in the right ballpark, but keep in mind that the previous two methods are more accurate.
Once you have a rough cost estimate for your solar system, it’s time to compare it to the cost of buying electricity from a utility provider to get a sense of how much you can save by going solar.
Do you really save money with solar panels?
Yes, homeowners across the US can save money on energy costs by powering their home with solar panels instead of purchasing electricity from a utility. This is especially true following the Rapid rise in grid electricity rates in 2022.
Home solar is essentially a way to buy electricity in bulk – similar to buying a giant can of coffee grounds from Costco instead of 50 individual cups at Starbucks. The 25 can of grounds costs more upfront but pays for itself after just 9 Grande Lattes at 3 each and nets 125 in savings over its lifespan.
It’s the same concept with home solar, just on a much larger scale.
How much money do you save a month with solar panels?
Exactly how much money you save a month with solar panels depends on a few main ingredients:
- Utility electricity rates
- Electricity consumption
- How you finance your system
- Your energy goals
These factors vary from household to household, so let’s take a look at the average monthly electric bill with solar panels and without solar panels.
- By paying cash for a solar system, you can enjoy maximum lifetime savings – often north of 50,000 – but it can take several years to reach a payback period
- By taking out a solar loan, you can front-load your cost savings by making solar loan payments that are less than your average electricity bill, but interest payments eat into your lifetime savings
Adjusting the size of your solar system and how you finance it gives you control over your essential electricity costs – something you’ll never have by purchasing electricity solely through a utility company.
How long does it take for solar panels to pay for themselves?
The payback period for solar panels is typically 6-11 years, depending on factors like your utility rate, electricity consumption, and how you financed the system.
With a solar loan, many homeowners are able to achieve “Day 1” savings by having a loan payment that’s lower than their average electricity bill. However, interest payments on the loan eat into the long-term energy cost savings.
By paying cash for solar, homeowners maximize their lifetime savings potential, but typically need to wait 6-11 years to recoup the upfront investment.
Is solar worth it financially?
As a hedge against energy inflation, home solar is considered a safe and steady investment with a rate of return similar to real estate and 401k. Remember, home solar allows you to replace your electricity costs with lower, more predictable monthly payments on your solar system.
Why is it financially beneficial to pay for solar rather than utility electricity?
The chart below shows the steady rise of utility electricity from 5 cents per kWh to 16.5 cents per kWh over the last 44 years.
For non-solar owners, this trend is a nightmare because it shows that utility rate hikes are about as certain as death and taxes. But if you have a home solar system, utility rate hikes are the fuel for your energy costs savings over the 25-year warrantied life of your solar system.
Home solar also acts as a time machine, of sorts. Instead of paying the current utility rate for electricity, the cost per kilowatt-hour of home solar is typically around 6-8 cents – roughly what utilities were charging 40 years ago.
So, are solar panels worth your money?
Solar panels are worth your money if you want to want to:
- Take control over your essential electricity costs
- Hedge against energy inflation
- Reduce your carbon emissions
- Increase your home value
- Provide backup power for grid outages (when paired with battery)
However, if you have a hunch that grid electricity are suddenly going to plummet below 8 cents per kWh and stay there for 25 years, then don’t buy solar panels.
How much does solar panel installation cost?
Installation labor accounts for around 5.5% of the total cost of a residential solar project, according to a 2022 report from the National Renewable Energy Laboratory.
That amounts to 1,375 for a 25,000 solar project.
This figure often seems surprisingly low to homeowners that are used to labor being a bigger chunk of the cost for car repairs, landscaping work, and other home upgrades.
It’s worth noting that installation costs vary from project to project based on the local minimum wage and scope of the project. For example, labor for specialized electrical work typically costs more than general labor for panel installation. This variability is why it’s tough to find a solar installation cost estimator online.
Overall, labor costs have fallen in the last decade as technology has improved and the labor force has matured. The chart below shows the solar panel installation cost breakdown since 2010.
- The overall cost of residential solar fell by 64% in the 2010’s
- Solar module, inverter, and labor costs have come down substantially in the last decade
- Non-labor soft costs and electrical hardware have been more stubborn
At the end of the day, the installation labor makes up a very small chunk of the total cost of a solar system – and it’s well worth having professionals install a system that you want to last for 25 years or more.
Can I install solar panels myself?
Some homeowners with advanced knowledge and experience in construction, circuitry, and local permitting guidelines (not to mention a good amount of time on their hands) are able to successful install solar panels up to inspection and interconnection standards.
However, it’s important to consider that DIY solar installation may void the manufacturer warranties on the equipment and does come with workmanship warranties.
So, if there are problems with the equipment or the installation, like a panel broken during installation or a leaky hole in the roof, you are on your own to solve and pay for them.
It’s also worth noting that full-service installers typically handle permitting, interconnection, and applying for incentives — which can be complicated and time consuming.
How much does one solar panel cost?
The average cost for one 400W solar panel is between 250 and 360 when it’s installed as part of a rooftop solar array. This boils down to 0.625 to 0.72 per Watt for panels purchased through a full-service solar company.
At a retail vendor, such as Home Depot, you can buy a single 100W solar panel for 100 or a pack of 10 320W solar panels for 2,659, which boils down to 0.83 to 1 per Watt.
Given the relationships with panel manufacturers, full-service solar companies are able to offer a much lower cost per solar panel than retail establishments.
How long do solar panels last?
Today’s solar panels typically have 25-30 year performance warranties that guarantee a certain level of production (usually 85-92% of its Day 1 capacity) during that time. However, the panels themselves can last and generate a meaningful amount of electricity for much longer.
For example, the first modern solar cells were created in 1954 and are still producing power from their display case in a museum. Similarly, a solar panel installed in 1980 on a rooftop in Vermont is still producing at 92% of its original capacity.
Based on manufacturer warranties, it’s safe to assume today’s solar panels will produce at a high level for at least 25-30 years. The real question is how far will they overshoot that warrantied lifespan.
How can I lower the cost of solar panels?
Although home solar is already more affordable than paying for utility electricity, there are a few ways to reduce the cost of your system and maximize your energy cost savings.
Solar incentives
First, there are solar incentives offered by federal, state, and local governments, in addition to utility providers.
The most notable is the federal solar tax credit worth 30% of what you pay for solar panels. So, if your all-in cost is 25,000, you can claim a tax credit worth 7,500 on your federal income tax return for the year your system was deemed operational.
Next, many states have additional incentives like tax credits, tax exemptions, and rebates for residential solar systems. For example, New York has all three with its NYSERDA rebate, 25% state tax credit, and sales and property tax exemptions for solar installations.
At the local level, many city governments, municipal utilities, and investor-owned utilities have incentives for solar panels, battery storage, and other energy efficiency home upgrades.
- The Austin Energy solar rebate worth 2,500
- California’s Self-Generation Incentive Program with battery rebates up to 1,000 per kWh of capacity
- Massachusetts’ handful of municipal utility rebates
It’s well worth spending 5-10 minutes searching for solar incentives through your state, county, city, and utility provider.
Compare multiple quotes
The next way to reduce the cost of solar panels is to shop for the lowest price like you would for cars or a new pair of hiking boots.
In most areas of the US, there are at least a handful of solar installers willing to compete for your business. Getting quotes from at least three reputable installers gives you a sense of a fair price, weeds out scammers, and gives you leverage to negotiate for a lower price.
Admittedly, it takes time and effort to research installers, set appointments, and sit through sales pitches in order to gather quotes. Solar.com simplifies this process by instantly generating dozens of quotes from our network of trusted installers so you can easily compare quotes in a pressure-free environment.
However you choose to do it, comparing multiple quotes is crucial to lowering your solar cost and setting yourself up for a long-lasting and productive solar installation.
Can I get free solar panels?
Despite what the ads on and YouTube say, it is not possible to get free solar panels from Tesla, Home Depot, or the US government. This is a common scam used to gather personal data and/or trick people into signing long-term solar lease agreements that are far less favorable than owning solar panels.
For example, in February 2023, a page called “Solar Panel Rate” ran multiple ads claiming Elon Musk was paying homeowners 2,500 to test out new solar technology. Further inspection revealed that the account was run by three individuals in Indonesia and the ads were designed to collect personal information.
There are also dozens of YouTube ads claiming that the “US government is giving away free solar panels.” While it’s true that the federal government strengthened the solar tax credit and created new home electrification incentives by passing the Inflation Reduction Act, it is not “giving away” solar panels.
Recap
The falling cost of solar panels coupled with the recent spike in grid electricity have made home solar a reliable means of reducing your essential energy costs.
While the five-figure price tag for home solar often gives people sticker shock, it’s important to remember that going solar is like buying 25-years worth of electricity in bulk. It may cost more upfront, but it is much more affordable than buying electricity at the retail rate from a utility.
Plus, there are zero-down solar loans that can spread out the cost of solar panels and, in many cases, provide instant energy cost savings.
Installation accounts for roughly 5.5% of the total cost of solar projects. However, non-labor soft costs like permitting, inspection, interconnection, and general overhead makeup around half of the cost of home solar.
There are a few ways to reduce the cost of going solar. First, research federal, state, and local solar incentives to make sure you’re not leaving money on the table. Second, shop around for the best price by getting multiple quotes from vetted local installers. (Solar.com makes this quick, easy, and pressure-free).
Finally, neither Elon Musk nor the US government are giving away free solar panels. And if they were, they wouldn’t be advertising it on and YouTube.
Steer clear of free solar ads to avoid giving away personal information or ending up in a long-term solar lease.
Frequently asked questions
Is one solar panel enough to power a house?
One solar panel is not enough to power a house. Home solar systems typically feature 10-20 panels in order to produce enough power to offset 100% of the average household electricity consumption.
It’s also worth mentioning that installing one solar panel at a time isn’t very efficient, as there are soft costs associated with designing, permitting, inspecting, and interconnecting solar systems. Homeowners typically get the most bang-for-their-buck by installing at once as many solar panels as they’ll need to offset current and near-future electricity needs.
How long can a house run on solar power alone?
According to the NREL, a small solar system with 10 kWh of battery storage can power the essential electrical systems of a home for three days in parts of the US and in most months of the year.
Essential electrical systems do not include electric heating or air conditioning, which require massive amounts of electricity.
However, it’s worth noting that solar systems need to be paired with battery storage in order to provide backup power during outages. Solar-only systems are automatically shut off during outages as a safety precaution to protect the technicians repairing the grid.
What is the main downside of solar energy?
The main downside of solar energy is that it’s intermittent. In other words, solar panels need sunlight to produce electricity, and when the sun goes down production stops.
This intermittence poses challenges to grid operators because it creates an influx of energy during the middle of the day, when consumption is down, and a lack of energy in the evening, when consumption is peaking.
The most obvious solution to this challenge is various forms of energy storage including batteries, pumped hydro, compressed air, and thermal technologies.
In fact, residential solar and battery systems in California provided around 340 MW of power during a heatwave in September 2022 to help prevent power outages.
Is it worth it to get solar panels in California?
Given its abundant sunshine and high utility electricity rates, California is one of the best states to save money with home solar.
In fact, even after reducing the value of solar exports through NEM 3.0 solar billing, Californian’s can still save more money with solar than homeowners in most other states. Under NEM 3.0, it’s much more beneficial to pair solar systems with battery storage in order to use as much of your own solar production as possible instead of exporting it onto the grid.
Many installers are offering less expensive “arbitrage” battery systems that allow solar owners to store and use their own electricity, but don’t provide backup power during outages (hence the price decrease).
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Dan is a writer on CNET’s How-To team. His byline has appeared in The New York Times, Newsweek, NBC News, Architectural Digest and elsewhere. He is a crossword junkie and is interested in the intersection of tech and marginalized communities.
There are many benefits of solar panels that homeowners know about.- they lower your energy bill, reduce your carbon footprint and can even earn you a healthy tax credit.
But did you know going solar also increases the value of your home?
A 2019 report from Zillow indicated that properties with rooftop solar installations sold for 4.1% more than comparable residences without them. For a median-valued home, that’s equal to roughly 9,300.
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And residences with solar are 24.7% more likely to sell for more than their asking price, according to property listings site Rocket Homes.
Tony Accardo, a Compass realtor in Los Angeles County, says solar is a huge selling point in his conversations with prospective buyers.
Can solar panels save you money?
Interested in understanding the impact solar can have on your home? Enter some basic information below, and we’ll instantly provide a free estimate of your energy savings.
If there were two identical homes, but one didn’t have solar and was 50,000 cheaper, the one with solar would sell first, Accardo told CNET.
Here’s what you need to know about how and why solar panels can increase your home’s value.
How much solar panels increase your home’s value
There are tax breaks available when you buy and install a rooftop solar system, most notably the federal solar tax credit.
When it’s time to sell, though, how much of a premium having a rooftop solar system brings depends on a variety of factors.- including where you live, the cost of electricity and what kind of system you have.
What’s most attractive to homebuyers is how much of your home’s energy needs your installation covers. If it can provide all of it, that can reduce your electricity bill by an average of 1,500 a year.- equal to about 37,500 over the life of the system.
If solar panels aren’t on buyers’ want list, it’s something they plan to install themselves, Accardo said. They want to offset energy costs and have a better resale situation themselves.
Solar is even more of a get than having a pool, he added.
An older couple looking at your house maybe isn’t going to care you have a pool. Or even see it as a pain, Accardo said. This is direct savings that everyone can take advantage of.
Where you live matters
The value of a solar setup varies substantially by market. Unsurprisingly, buyers in states where electricity bills are higher place more of a premium on solar panels.
In January 2023, residential electricity bills were highest in California, Illinois, Michigan, New York, New Jersey, Pennsylvania and Wisconsin, and across New England, according to the Energy Information Administration.
With over 10.7 million homes relying primarily on solar, California overwhelmingly has the largest residential solar market.
Below are the top 10 states for solar, based on data from the Solar Energy Industry Association on the cumulative amount of solar energy capacity installed through 2022 and the number of homes powered by solar.
States with the top solar markets in 2022
| MW of solar installed | Number of homes powered by solar |
| 39,729 | 10,748,338 |
| 17,247 | 1,957,307 |
| 10,111 | 1,195,212 |
| 8,179 | 949,781 |
| 6,330 | 974,221 |
| 5,040 | 910,572 |
| 5,033 | 572,815 |
| 4,411 | 705,165 |
| 4,286 | 476,108 |
| 4,259 | 711,327 |
Many of these states offer credits to homeowners who give excess energy back to the grid. And at least 36 states offer property tax exemptions for a home solar system. So while it will increase the value of your home, it won’t increase your tax bill.
A 2015 analysis by the Department of Energy’s Lawrence Berkeley National Laboratory found that buyers in California, Connecticut, Massachusetts, Minnesota, North Carolina and New Jersey paid 15,000 more for a home with a typical 3.6-kilowatt solar photovoltaic system. (The equivalent to about 4 more per watt generated.)
Specific metro areas have also risen to the top when it comes to adopting solar panels: Last year, they were most in demand in Los Angeles, San Diego, Honolulu, Phoenix, San Jose, San Antonio and New York City, according to a survey by the Environment California Research Policy Center.
In New York, having solar panels upped the closing price of a property by 5.4%, compared to the 4.1% increase nationwide, Zillow reported. For a median-priced home in the Big Apple, that worked out to about an additional 24,000.
Electricity will remain high
Overall inflation slowed to 5% in March.- and could go as low as 3% by the end of the year. But Mark Wolfe, director of the National Energy Assistance Directors Association, told USA Today that electricity may increase by as much as 10% in 2023 and possibly in 2024, as well.
That’s because liquified natural gas, which fuels over a third of Americans’ electricity, has become scarcer as the US exports a record amount to Europe, which has been struggling to replace the supply it no longer gets from Russia after its 2022 invasion of Ukraine.
Unprecedented export volumes are, for the first time in history, binding American household energy bills to global calamities, Wolfe wrote in an open letter last fall to Energy Secretary Jennifer Granholm.
He described the situation as a domestic energy pricing crisis.
Asked about the reasons for adding solar panels, almost all (92%) homeowners who have installed them or considered doing so pointed to saving on utility bills, the Pew Research Center reported.
People aren’t altruistic, Accardo said. They’re interested in solar because of saving, not because of the environment.
Will solar always add value to my property?
Having a well-maintained rooftop solar system is highly unlikely to ever lower your property’s value, Accardo said. Even if you don’t have solar panels, buyers may pay more for a house with roofing that’s well-suited to installing them later.
But changes in state regulations can make solar less of a selling point: California recently altered its solar incentive from a net-metering system, where homeowners get a near-dollar-to-dollar credit for excess energy, to a net-billing program where your surplus is sold to the utility at a substantially lower rate.
Systems installed after April 14, 2023, could earn homeowners 75% less if they don’t also have a home battery setup, according to the California Solar and Storage Association, the state’s largest solar trade organization. (Existing systems are grandfathered under the current net-metering structure.)
Similar policy changes decreased the uptake of solar in Hawaii, Nevada and Missouri, the nonprofit Environment America reported.
In Arizona, new fees and regulations nearly doubled how long it takes solar panels to pay for themselves, leading to a decline in adoption of between 50% and 95%, EA reported. (Despite it being the sunniest state in the union, fewer than 200,000 homes in Arizona are powered by solar.)
The state of your panels and your home are also a factor. If a buyer sees that they’re going to have to invest in repairs, it will likely drive the price down.
And as other states adopt net billing, having solar panels paired with a home battery backup system will be increasingly important to get the most value for your home.
For more on solar panels, find out how to avoid scams and learn about the big changes to California’s solar incentives.
Solar PV Panels Market Size, Share Trends Analysis Report By Technology (Thin Film, Crystalline Silicon), By Grid Type (On Grid, Off Grid), By Application (Residential, Commercial, Industrial), By Region, And Segment Forecasts, 2023. 2030
The global solar PV panels market size was valued at USD 157.75 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 7.8% from 2023 to 2030. Growing demand for renewables-based clean electricity coupled with government policy tax rebates and incentives to install solar panels is expected to drive the growth of the solar PV panels industry in the coming years.
Companies in the commercial and industrial sectors are among the major consumers of solar photovoltaic panels owing to the large-scale demand for green energy. The installation economies of scale in these sectors compensate for any loss in panel efficiency, making solar PV systems profitable for large-scale generation. The residential sector is gaining momentum in solar PV panel installations due to net metering schemes for grid-connected systems and the availability of energy storage systems for off-grid systems.
The market in the U.S. is expected to witness a prominent growth rate on account of robust federal schemes such as solar investment tax credit, rising demand across public and private sectors for green electricity, and declining panels cost. According to the Solar Energy Industries Association, the U.S. solar industry generated an investment of USD 33 billion in 2021 and achieved an installed capacity of 23.6 GW across the nation.
The government of the U.S. has implemented various new incentive schemes to promote the adoption of solar and other renewable technologies. For instance, in August 2022, the U.S. government launched the Inflation Reduction Act (IRA) which allotted USD 369 billion for the promotion of the renewable energy sector.
Many companies have started to construct new solar PV plants and are increasing the capacity of their existing plants. For instance, in February 2023, Silicon Ranch announced that it will increase its solar power plant’s energy generation capacity. Also, First Solar will supply 1.5 GW of advanced American thin-film solar modules. This is in addition to its prior agreements which include the installation of a total of 4 GW of solar PV panels by 2027.
The value chain of solar PV panels includes raw material suppliers, equipment suppliers, module manufacturers, distributors, and buyers that function in industrial, commercial, and residential markets. The majority of manufacturers in the solar PV panels market are heavily backward integrated. First Solar, Solar World, and Yingli are among the key companies practicing vertical integration.
However, the COVID-19 outbreak disrupted the global solar PV panel supply chain, resulting in increasing panel with manufacturers facing labor shortages, material supply shortages, and stagnant international trading impacting the export market. Delayed projects due to supply chain disruption will further impede the solar industry.
Technology Insights
The thin-film segment occupied a dominant market share of 42.54% in 2022, owing to the increased durability and compact design of thin-film solar PV panels. over, these panels are flexible and lightweight. Thin-film solar PV panels are mainly used in utility-scale and commercial applications owing to their low installation costs. These panels are known as cost-effective substitutes for silicon-based solar PV panels as they can be manufactured in bulk.
The crystalline silicon segment is projected to grow at a substantial CAGR over the forecast period, owing to the lightweight and extended lifecycle of these panels, along with the low manufacturing costs of silicon semiconductors used in them. The key global suppliers of crystalline silicon solar PV panels are Hanwha Group, JinkoSolar, SHARP CORPORATION, and Canadian Solar Inc.
Application Insights
The industrial segment accounted for a dominant share of 40.57% in the solar PV panels market in 2022 and is projected to grow at a significant CAGR of 7.6% over the forecast period. The growth of solar PV panels in the residential segment is attributed to numerous benefits such as lower carbon footprints, lower electricity bills, and higher home values. With the help of solar systems, consumers are eligible for tax credits introduced by governments. The launch of new solar PV panel products in residential applications is expected to increase product demand over the forecast period. For instance, in December 2022, Soloes launched next-generation solar panels, ANTARES BI 144, with high radiation capacity and proof against negative effects from sunlight.
Increasing adoption of solar energy as a power source in corporate offices, hospitals, and hotels is expected to drive the demand for solar PV panels in the commercial sector with increased power demand in data centers and communication base stations. In addition, improved solar PV panel efficiency, improved energy yields, and module-level monitoring are some of the key factors contributing to the adoption of solar PV panels in this segment.
Growing demand for clean energy is anticipated to propel the development of utility projects and fuel the solar PV panels market growth across the industrial sector. According to the Solar Energy Industries Association, as of 2022, there were 6,000 solar projects in the U.S. with a capacity of 182 GW.
Grid Type Insights
On-grid type accounted for a significant revenue share and was valued at USD 155.43 billion in 2022. The dominant position of the on-grid type is majorly attributed to the low operating maintenance costs and non-complexity of grid-connected PV systems. The on-grid PV systems have lower costs as the excess electricity generated is exported to the grid and no battery storage needs to be installed near the system source. Net metering and feed-in tariff policies have further provided a boost to the segment growth.
Off-grid type is projected to ascend at a CAGR of 16.0% over the forecast period. The expansion of solar PV panel manufacturers and the growing capacities of off-grid solar PV panels are expected to drive the off-grid type segment. Challenges faced by traditional solar PV panel systems in the form of limited land availability and high grid installation costs are negated by the adoption of off-grid solar PV panels.
Tax benefits and subsidies offered by governments of different countries for the installation of off-grid solar PV panels, along with rent benefits offered to reservoir owners, are expected to further augment the growth of the off-grid type segment in the global solar PV panels market over the forecast period.
Regional Insights
The Asia Pacific region held the largest share of 54.31% in the global solar photovoltaic panel market in 2022, with China being the largest contributor to revenue generation. The presence of large market players and the supportive government policy of providing subsidies and financial incentives for photovoltaic projects are the key factors for the growth of the industry in China.
The market in North America is expected to grow at a CAGR of about 7.9% over the forecast period. Proliferating capacity of residential consumers coupled with the announcement of new utility projects is expected to enhance product penetration across the country over the forecast period.
Apart from being the largest manufacturing hub of panels manufacturing, China has several solar farms including the world’s largest floating farm that can generate 40 MW of electricity. In addition, the country accounts for a prominent position in solar PV panel exports to the world. However, some countries like U.S. and India have applied restrictions on the amount of PV panels imported from China, thereby disrupting solar industry profits in the country.
Key Companies Market Share Insights
The global solar PV panels industry is competitive with key participants involved in RD and constant innovation done by the manufacturers has become one of the most important factors for companies to perform in this industry. The high degree of forward integration, security of raw material feedstock, technology sourcing, skilled manpower, and strong RD are among the prominent factors governing the competitiveness of the solar PV panel industry. Globally, rising renewable energy demand in addition to growing energy security concerns is driving the market growth. Some prominent players in the global solar PV panels market include:
- JinkoSolar
- JA Solar
- Trina Solar
- LONGi Solar
- Canadian Solar
- Hanwha Q-CELLS
- Risen Energy
- GCL-SI
- First Solar
- SunPower Corporation
Solar PV Panels Market Report Scope
Report Attribute
Market size revenue in 2023
USD 170.25 billion
Revenue forecast in 2030
USD 287.13 billion
Growth rate
CAGR of 7.8% from 2023 to 2030
Base year for estimation
Revenue in USD billion and CAGR from 2023 to 2030
Revenue forecast, company ranking, competitive landscape, growth factors, and trends
Technology, grid type, application, region
North America; Europe; Asia Pacific; Central South America; Middle East Africa
U.S.; Canada; Mexico; Germany; Russia; UK; France; Italy; Spain; Turkey; Croatia; China; Japan; India; South Korea; Australia; Brazil; Colombia; Paraguay; Saudi Arabia; South Africa; Egypt; UAE
JinkoSolar; JA Solar; Trina Solar; LONGi Solar; Canadian Solar; Hanwha Q-CELLS; Risen Energy; GCL-SI; First Solar; SunPower Corporation
Free report customization (equivalent up to 8 analyst’s working days) with purchase. Addition or alteration to country, regional, and segment scope.
Pricing and purchase options
Avail customized purchase options to meet your exact research needs. Explore purchase options
Global Solar PV Panels Market Report Segmentation
This report forecasts revenue growth at global, regional country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the global Solar PV panels market report based on technology, grid type, application, and region:
- Technology Outlook (Revenue, USD Billion, 2018. 2030)
- Thin Film
- Crystalline Silicon
- Others
- On Grid
- Off Grid
- Residential
- Commercial
- Industrial
- North America
- U.S.
- Canada
- Mexico
- Germany
- Russia
- UK
- Spain
- Italy
- France
- Turkey
- Croatia
- China
- Japan
- South Korea
- India
- Australia
- Brazil
- Colombia
- Paraguay
- Saudi Arabia
- UAE
- South Africa
- Egypt
Frequently Asked Questions About This Report
b. The global solar PV panels market size was estimated at USD 157.75 billion in 2022 and is expected to reach USD 170.25 billion in 2023.
b. The global solar PV panels market is expected to grow at a compounded annual growth rate of 7.8% from 2023 to 2030 to reach USD 287.13 billion by 2030.
b. Asia Pacific dominated the solar PV panels market with the highest share of 54.31% in 2022. The presence of large market players along with favorable government policies providing subsidies and financial incentives to PV projects are among the key factors contributing to the industry growth in China.
b. Some key players operating in the solar PV panels market include Canadian Solar, Solar Power Rocks LLC, Yingli Solar, HelioPower, SMA Solar Technology, Greenlight Planet, Schneider Electric, Backwoods Solar, and SuKam Power Systems among others.
b. Key factors driving the solar PV panels market growth include growing demand for renewable-based clean electricity coupled with government policy tax rebates and incentives to install solar panels is expected to drive the Solar PV Panels Market growth in the coming years.
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Understand the Sun! 27 Fantastic Facts About Solar Energy and Solar Panels
Solar energy has been used for more than 2,700 years for heating, cooking, and other essential applications that make our lives more efficient. It’s obvious why the sun has been such an essential resource for humanity — if its rays can heat our bodies while we’re just walking around outside, there must be other things we can do with it!
Yet, solar energy technology really only came into its own in 1954, when Bell Laboratories created the first commercially viable solar cell. Since then, solar has leaped into prominence as the fastest-growing sector of the energy economy, creating jobs at six times the rate of the general job market. There are just so many advantages to using solar energy whenever and however possible.
At Chariot Energy, we’re obviously big fans of solar energy and solar panels. It’s the reason we want to help Texans power their homes with solar energy without needing to install panels on their homes. We want to share our love for the sun with you by assembling this fun list of facts about our industry, complete with some lesser-known tidbits that might surprise you.
Solar Power Facts for the Eco-Friendly
Our sun is powerful. Not only is its energy virtually inexhaustible, but it’s also the most abundant source of energy on Earth. Fossil fuels just can’t compare. They don’t last as long, it takes eons to replenish, and they have a negative effect on the environment. So, let’s lay out the facts for why solar energy is truly one of the most environmentally friendly resources out there.
174,000 terawatts of energy consistently strike the earth as solar radiation at any moment, even on the cloudiest of days.
One hour of sunlight is equivalent to one year’s worth of energy for the planet.
Solar energy produces no pollution when generating electricity.
Sunlight travels the 90 million miles to Earth in 10 minutes.
Solar plants can last more than 40 years.
At around 1,000 acres, the world’s largest solar power plant is located in the Mojave Desert.
Solar energy is the cheapest source of energy in the world as of 2017.
Solar energy is cheaper than fossil fuels as of 2019.
China is the world leader in solar energy generation.
The United States is the third-largest solar energy market and generator in the world.
California generates the most solar energy in the United States.
than 260,000 people worked in the solar energy industry in 2016.
Solar energy users save up to 35 tons of carbon dioxide and 75 million barrels of oil each year.
Solar Panel Facts for the Homeowner
While some of us probably created foil-lined solar ovens for a school science project, we also know solar energy will only be fully embraced when it feels just as convenient as conventional electricity.
Enter the solar panel. This delightful bit of technology can truly harness the power of the sun, converting into electricity to power homes and businesses around the world. than any other renewable energy source, solar energy has the most flexibility to deliver true energy change for our planet. Here are 14 facts about solar panels for the homeowner.
Alexandre Becquerel discovered the photovoltaic effect in 1839.
Russell Ohl created the first photovoltaic cell in 1941.
Bell Laboratories developed the first modern solar cell in 1954.
Over 2 million solar panel systems have been installed in the U. S. alone.
Homeowners experience “break-even” on their solar panel installation in under a decade.
Solar panels are the fastest energy source to set up.
Solar panels produce 10 kilowatt-hours of electricity per square foot.
Solar panels don’t need direct sunlight to generate electricity.
To power the whole earth with solar energy, it would require 191,000 square miles of solar panels.
In 30 years, the average rooftop solar panel system can reduce pollution by 100 tons of carbon dioxide.
The average solar panel has a 25-year warranty.
The most efficient solar panels are made from monocrystalline silicon.
The city government of Las Vegas, NV operates on 100% renewable energy from solar panels.
The average solar panel system operates at 20% efficiency, meaning that it converts 20% of the sunlight that hits it into electricity.
You Can Make a Difference with Solar Power Energy
The U.S. alone generates enough electricity from solar energy to power more than 11.3 million homes. And that number continues to rise as we pursue increased energy independence and reduce the effects of fossil fuels on the environment. By signing up for an electricity plan from Chariot Energy, you are showing the Texas energy industry that you value the expansion and development of increased solar energy capacity.
Once you fall in love with solar energy, you can take additional steps to show people the importance of enhancing the green energy profile of Texas, the U.S., and the world. We recommend the following:
- Installing solar panels on your home
- Lobbying the state government to force utility companies to accept solar buybacks
- Asking your legislators to invest research dollars into improving batteries for renewable energy
- Convincing your family and friends to sign up for a solar energy plan from Chariot Energy
We must make every possible stride to converting our society’s energy profile to completely renewable energy sources if we want to lower our collective carbon footprint, reduce global warming, and defeat climate change.