What Influences The California Solar Panel Cost?

by | Apr 5, 2024 | Renewable Energy, Solar Energy

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California solar panel cost an average of $2.51 per watt, or $12,550 for a 5 kilowatt (kW) installation. This is less than the national average of $2.85 per watt ($17,100). Along with the 30% federal solar tax credit, California provides a property tax exception for solar systems. If you install a house battery, you can qualify for a state-sponsored rebate.

Cost Per System Size in California

The size of the solar system required to power a home is determined by energy usage and local sunshine. According to the Residential Energy Consumption Survey conducted by the United States Energy Information Administration, the average California home consumes 6,482 kilowatt-hours (kWh) of power each year. According to Global Solar Atlas, a 5 kW solar system is more than enough to create this energy output due to the ample sunshine in California. However, you would require a more extensive solar array if you have a larger home with extra equipment, such as a pool pump or an electric vehicle (EV) charger.

The average cost of a household solar system in California is $2.51 per watt. Before incentives, a 5 kW system costs $12,550, and a 10 kW system costs $25,100. The table below shows the estimated California solar panel cost ranging from 5 kW to 10 kW before and after the federal solar tax credit.

System Size System Cost Cost After Federal Tax Credit
5kW $12,550 $8,785
6kW $15,060 $10,542
7kW $17,570 $12,299
8kW $20,080 $14,056
9kW $22,590 $15,813
10kW $25,100 $17,570

What Influences the California Solar Panel Cost?

Several factors can affect the California solar panel cost, including:

What Influences the California Solar Panel Cost?

1. System size: It is the most critical factor in determining how much California solar panels cost. A more extensive system will require more solar panels, a larger solar inverter, wires, and other equipment, increasing expenditures. The more electricity your home uses, the larger the solar system you’ll require.

2. Solar Incentives: California provides a property tax exemption for solar panel systems installed before 2025. Adding a battery bank to your solar panels can give you a $150 incentive per kilowatt-hour storage capacity. California also provides a solar incentive of $3 per watt to disadvantaged communities, sufficient to cover the whole cost of many solar projects.

3. Net Metering: Net metering employs a bidirectional metre, allowing consumers to earn power bill credits for any extra energy their panels generate and transmit back into the grid. In 2023, California implemented a new form of net metering (NEM 3.0), significantly reducing the tariffs paid for surplus solar energy.

4. Type of Solar Equipment: The type and quality of solar equipment you choose impact the cost of your system. Modern solar panels are available in various varieties, each with its own set of efficiencies and features—for example, monocrystalline and polycrystalline panels. Because solar panels account for a substantial amount of a system’s cost, cheaper solar panels result in a lower-cost system. The same holds for the other system components.

5. Payment Choices: Many solar providers provide payment alternatives, including solar financing. Homeowners who want to avoid a significant upfront expense might choose low-interest solar financing with lower monthly payments. Other choices include solar leases and power purchase agreements (PPAs), which require you to pay a monthly charge while the vendor owns the system. Overall, the payment option you select will determine the cost of your solar panel installation.

In conclusion, installation size, material quality, and available subsidies impact California solar panel cost. Understanding these variables enables consumers to make informed decisions about solar energy adoption.

Also Read: Solar Energy Benefits: An Analysis


  • Michael Thompson

    Michael Thompson is an esteemed expert in the renewable energy sector, with a profound experience spanning over 25 years. His expertise encompasses various sustainable energy solutions, including solar, wind, hydroelectric, and energy efficiency practices. Michael discusses the latest trends in renewable energy and provides practical advice on energy conservation.


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