What You Should Know About the Cost of Solar Panels in California

The Golden State is known for having an abundance of sunshine. That makes California the perfect place to reap the rewards of solar energy. Before jumping in with both feet, you likely want to understand all the costs associated with making the switch. Let's break it down.

Startup costs

The cost of solar panels can vary based on several factors, including the size of the system, the type of panels, and installation fees. As of June 2024, the average solar panel system costs $2.69/W including installation in California. For a 5 kW installation, this comes out to about $13,440 before incentives, though prices range from $11,424 to $15,456. This price includes equipment, installation, and necessary permits.

But wait…let's save some money.

There are tax credits and incentives available to make solar energy more affordable. The federal residential solar tax credit is the most valuable incentive you can claim this year because it saves you thousands of dollars in the form of a 30% tax credit. And there's no limit to the amount you can claim. The tax credit will remain at 30% until 2033, when it's scheduled to drop down to 26%.

Of course, financing is available

We get it, not everyone has the resources to pay thousands of dollars in one lump sum. Our financing solutions offer a competitive APR and terms ranging from 5-25 years. You have the flexibility to choose a payment plan that suits your budget and financial goals. Ask about our lease, monthly loan, and cash purchase options.

Long-term Savings

One of the most compelling reasons to consider solar is the return on your investment. For example, if you spend $12,000 for startup costs after various rebates, it would take about eight years to break even on your solar investment. Solar panels usually last for 25 to 30 years. That means you would still have 17 to 22 years of savings on energy costs. Based on current average energy costs and average energy production numbers, you could save $1,600 each year—or $25,500 to $33,000 on electricity during the life of your system.

Wrapping it up

The initial cost of installing solar panels is not the only numbers that matter. The incentives, financing options, and long-term savings make solar a worthwhile investment for many homeowners. Ready to know more about costs? Contact us today to learn how to say "lights out" to your electric company.