PV Solar Power Cost per Watt: 5kW-7kW Solar Panels System Costs 2021

This is a good time to install a photovoltaic solar power system on your property. Residential rooftop PV solar panels cost per watt installed has been dropping, and newer technology is enabling a far greater efficiency – that’s more solar energy converted into electricity for home usage – for less money.

A new asphalt shingle roof outfitted with PV solar panels

Your options for buying, leasing, Purchasing Power Agreements (PPA, see below) are expanding, and many homeowners are getting solar panels installed on their rooftops for zero down.

In this guide:

  1. Cost per Watt
  2. Total System Cost
  3. Cost Factors
  4. Rooftop Installation Considerations
  5. PV Solar Panels
  6. Buying, Leasing, and PPA Options
  7. BiPV Solar Tiles
  8. Thin-Film Solar Laminates
  9. PACE Solar Finance Program
  10. Solar System Payback Period

Cost per Watt

The national average residential solar cost per watt installed is $2.96 for a typical 5kW ($14,800) to 7kW ($20,720) PV solar panels system when installed by local installers, before the 26% solar investment tax credits from the federal government.

Did you know? The 26% solar tax credits have recently been extended by congress through the end of 2022. Notably, solar ITC apply to the full amount paid for the installation of a new solar panels system.

Depending on the state you live in, your quoted cost per watt can range from $2.80 to $3.22, on average, when installed by a (small) local solar panel installer.

Note that solar investment tax credits (ITC) are being phased out, gradually, with the amount of tax credits decreasing from 26% to 22% in 2023 (the final year for solar ITC).

How Solar Pricing has Decreased Over Time In 2008, the cost of a solar power installation was $8.82 per watt.

Average System Cost for residential PV Solar Panels installed by Local Installers:

Small Home Average Home Large Home
Home Size 1 – 2 bedrooms 3 – 4 bedrooms 5 bedrooms
System Size 5 – 7kW 7 – 8.5kW 9 – 10kW
System Cost $14,800 to $20,720 $20,800 to $25,160 $26,640 to $29,600
After Tax Credits $10,952 to $15,333 $15,350 to $18,618 $19,714 to $21,904

Note: The federal solar investment tax credit is 26% through 2022, and 22% in 2023. After the recent extension by congress, the program is slated to end on December 31st, 2023.

Homeowners take note: large solar installers with national presence like SunRun and Vivint Solar (acquired by SunRun in 2020) will have higher costs per watt installed vs. a small local solar installer due to much higher marketing and customer acquisition costs for large installers with national presence.

SunRun and Vivint Residential Solar PV system cost per watt installed. Source: Corporate filings

Based on the recent data from the US National Renewable Energy Laboratory (NREL),
the average price per watt installed by Vivint and SunRun in 2020 has been ranging between $4.00 and $5.00 per watt. In fact, SunRun’s and Vivint prices per watt installed have increased in 2020 over 2019 due to higher marketing costs in 2020.

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BIPV Solar Shingles Cost: SunTegra, CertainTeed Appolo, Tesla Solar Roof

Your options for building integrated photovoltaic solar roofs have expanded with Suntegra, CertainTeed Appolo, and Luma Solar tiles to compete with other PV solar products currently being installed.

Certainteed Apollo-2 solar shingles roof

This guide covers the currently available and newly emerging BIPV / roof integrated PV (RIPV) solar shingle options, their costs, availability in specific markets within the US, and pros and cons of each option.

Cost

The table below includes the cost info and availability details for the top four leading RIPV competitors:

Product Cost per sq.ft. Cost per watt* 2,750 sq.ft. roof
CertainTeed Apollo II Shingle $11.45 – $13.10 $4.20 – $4.80 $31,487 – $36,025
CertainTeed Apollo II Tile $17.40 – $18.25 $6.38 – $6.69 $47,850 – $50,187
Dow PowerHouse $11.00 – $11.85 Est. $4.15 $30,025 – $32,587
SunTegra Shingle $10.35 – $11.60 $3.80 – $4.25 $28,462 – $31,900
SunTegra Tile $16.80 – $17.75 $6.16 – $6.51 $46,200 – 48,812
Tesla Solar Tile $22.00 – $26.00 $7.85-$9.00 $60,500 – $71,500

BIPV solar shingles costs

Note: the above figures are baseline costs (estimated). The actual costs can, in some cases, be up to 25% higher, depending on the particulars of the jobs including more complex roofs and/or in areas with high cost of living and in major coastal cities.

All costs include what is known as BOS, or balance of system, costs. These include the connectors, wiring and electrical inverter required for the installation. They do not factor storage battery costs ($7,500 – $9,000 for most systems).

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3 IN 1 ROOF Cost vs. Tesla Solar Roof

If you’re a solar power enthusiast, perhaps you’ve read about the solar roof system developed by a company called 3 IN 1 ROOF. It is expected to challenge the Tesla solar roof in the quest to become the market leader in building-integrated photovoltaic (BIVP) roof tiles for homes.

3 IN 1 ROOF – classic solar tile roof

via 3 IN 1 ROOF

Insulation + Hurricane Protection + Solar = 3 IN 1 ROOF

More on the head-to-head with Tesla later. First, we explore 3 IN 1 ROOF cost and what exactly this innovative roofing system is all about.

Cost

Right off the bat: A typical 3,000 sq. ft. BiPV solar roof system from 3 IN 1 ROOF is estimated to cost $71,120 installed, before tax credits and energy savings are taken into account. This translates to roughly $24 per sq. ft. installed.

Once solar tax credits and energy savings are taken into account, you get the following financial breakdown:

3,000 s.f. roof: $71,120 before solar tax credit. First year cash flow: $18,142 with about $2,600 of that being from energy savings. That leaves a tax credit of about $16,540 on the solar part.

For smaller-sized roofs, 3 IN 1 ROOF supplied us with the current cost projections taking solar tax credits into account:

Installed Cost Avg. Cost Installed Total Cost 2,000 Sq.Ft. Home
$18-$24 sq.ft. $21 sq.ft. $42,850 to $68,650
The above costs are based on the current 30% federal tax credit. In this table, costs will go up by 4% in 2020.
Solar Tax Credit Schedule

The cost factors below the table will help you gauge where on the spectrum your costs will fall.

Note: This page from the US Department of Energy (US DOE) has complete information on the Residential Renewable Energy Tax Credit for 2018 through 2021.

Our best guess is that the tax credit will likely be extended due to the importance of promoting energy-efficient homes and buildings.

However, with the credits currently set to end in a few years, having a solar roof installed in the next couple of years rather than later could be a decision that saves you $20,000 or more.

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