Cost To Install A Home Solar Array

What are the costs of a home solar system?

Because so many factors come into play, it is extremely difficult to say what a home solar power system costs. Individual solar site assessments and equipment projections by capacity, paired with personal energy usage data are required to arrive at a figure.

Working with all the averages, however, you can say the following statements are accurate, but hardly site specific:

- A 3.6 kW photovoltaic solar array will provide about half the power needed by the average American home, which will consume roughly 10,000 kWh annually.

- A home solar system of that size will have an opening cost of $32,000. (That can vary widely by region and by equipment used.)

- Most homeowners, after applying rebates and tax credits, spend approximately $15,000 to $40,000.

Using the solar calculator tool at findsolar.com, let's consider a more specific example, calculated for the region of the Dallas / Fort Worth Metroplex, on the fringes of the American Southwest, the nation's prime region for solar power use.

To create an exemplar only, we will assume the homeowner's monthly bill averages $200 and the desired goal is a 50% monthly power generation from roof-mounted solar panels:

Area's Solar Radiance
5.41 kWh / sq M / day
Average Usage Per Month
1,357 kWh
Size of Required System
5.20 kW
Required Roof Space
520 sq ft
Estimated Cost
$41,615.05
Post Incentive Cost
$20,172.90
Applicable Incentives
30% federal tax credit, property tax exempt, $2.46 / w DC rebate from power company
Average Monthly Savings
$100.00
Savings Over 25 Years
$49,975.09
25 Year Return on Investment
247.73%
Break Even Point
13.11 years

Now, using the same scenario, let's move that homeowner to Phoenix, Arizona, in the heart of the best area for solar power use:

Area's Solar Radiance
6.33 kWh / sq M / day
Average Usage Per Month
1,969 kWh
Size of Required System
6.45 kW
Required Roof Space
645 sq ft
Estimated Cost
$51,638.23
Post Incentive Cost
$35,146.76
Applicable Incentives
Sales and property tax exempt, 30% federal tax credit
Average Monthly Savings
$100.00
Savings Over 25 Years
$49,975.09
25 Year Return on Investment
142.19%
Break Even Point
19.77 years

With incentives, both homeowners did stay within the suggested range of $15,000 to $40,000 for total system costs, but a number of factors affected power produced, long-term return, and the break-even point of the investment.

(As a point of comparison in Boston, using the same numbers in a less than optimal area, with 4.27 kWh / sq M / day, a homeowner would pay a post-incentive price of $31,815.39 for a home solar energy array with a break-even point at 18.43 years. Again, however, this is not taking into account specific figures for local rates and individualized electrical use.)

Looked at purely in environmental terms, the first home in Texas without solar energy creates emissions roughly equal to 24,417 lbs. (27,057 driving miles). The Phoenix home comes in at 35,433 lbs. per year (39,264 driving miles). Obviously, understanding the environmental impact of a solar home is much easier than contemplating its financial profile.

These are only some of the factors a homeowner must consider before moving forward with the decision to invest in residential solar energy. Another important consideration is how your home solar array will interact with the local power company's grid.

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