How Much Do Solar Panels for Your Home Cost?

Brick one story home with solar panels on the front roof

“How much does solar cost?” is the most common question people have about home solar systems. It’s a simple question with a complicated answer. The simplest answer is that our average 7.6kW system is roughly $26,000 (~$18,200 out of pocket after applying the Federal Tax Credit incentive). While that’s the average, actual solar prices in 2021 ranged from $5,000 on the low end all the way up to $70,000! The graph below shows how widely the cost of home solar can vary based on factors like site location, sun exposure, available roof space, home energy use, and energy offset goals. 

If you want to know exactly how much solar will cost for you, reach out to one of our solar educators for a free assessment and a custom quote.

Solar Tax Credit & Utility Rebates

Now you know the price range of a solar system, but that’s only part of the story. Right now, North Carolina solar has 1 major incentive available: the Federal Solar Tax Credit. Understanding how this incentive works is crucial to determining the true cost of your solar system. Here’s a breakdown:

30% Federal Investment Tax Credit

Price impact: 30% tax credit

If you live in the US and pay federal taxes, then you’re eligible for this tax credit which will drop the price of a $26,000 solar system down to $18,200! The 30% tax credit has recently been restored through the signing of the Inflation Reduction Act. Learn more about what else has changed here. 

What Makes Up the Cost of Home Solar?

Now that we’ve established the cost of a home solar system, the next question is: “why does it cost that much?” Buying a solar system is like buying a new car or remodeling your kitchen. There is a base model that will get the job done, but within each component there are a range of prices based on materials, brand, etc. Here are the major elements that make up the cost of a solar system:

  • Solar Panels →  The bulk of your system and the most obvious component you’ll need
  • Inverter(s) → converts the direct current (DC) generated from your solar panels into alternating current (AC) that can be used by all the appliances and systems in your home.
  • Racking system → Keeps your solar panels on your roof where they belong.
  • Monitoring System → Allows you to track your solar savings right from your phone; perfect for showing off to your friends.
  • Installation Labor → The fun part; our 100% in-house team of installers transforms your roof into an independent clean energy power plant.
  • Design, Permitting, Admin →  Every utility and local inspection department has its own standards, requirements, and forms (so many forms!) for going solar. We take care of all of this for you!
  • Balance of System  →  All of the wires, nuts and bolts, junctions boxes, fuses, love, sweat, tears, etc. that complete the system.

How much do each of these components contribute to the overall price? Check out the graph below.

These components are all standard, so what changes the price of system? In the list below we try to answer this by breaking down the major and minor cost variables for a solar system.

Major Solar Cost Adders

System Size​

Price impact: Infinite

Size is the most important–and probably the most obvious–variable for a solar system’s cost. As your system size increases, it will require more materials and labor for installation and the price will increase as well. While the price continues to increase as systems get bigger, the price per watt (price divided by the system’s wattage) gets lower–in other words as the system gets bigger you get more watts for each dollar you spend.

Panel Type​

Price impact: $1,000 increase for Monos

There are two main types of solar panels: polycrystalline (polys) and monocrystalline (monos). Polys are generally less expensive but are widely considered less aesthetically pleasing because their cells have a blue space-age appearance while monos have more fashionable all-black cells.

Polys are slightly less expensive, but some people (we’re not naming any names!) don’t dig their space-age blue appearance.

Monos are more expensive but their fashionable all-black cells are preferred by many homeowners (and probably also by snazzy New York fashion bloggers).

Roof mounted vs ground mounted​

Price impact: $3,000-5,000

Most of our home solar installs are on the roof, but occasionally a roof is too shaded, too complicated, too small, too something to hold a solar system–so we install the system on the ground instead. The price increase is for trenching, drilling, racking, and permitting. While it has a higher cost at the outset, you may save more money by generating more power in the long run

Battery Storage

Price impact: $13,200 – $14,500 before tax credits are applied. Additional Powerwall units run between $10,500 – $11,500 each depending on how many you purchase and if you purchase it with solar.

Batteries are exploding in popularity thanks in a large part to the popularity of Tesla and Elon Musk. Batteries are optional add-ons and allow you store power rather than exporting it to the grid and, if sized properly, can provide reliable backup power during a power outage.

Minor Solar Cost Adders

Roof Pitch

Price impact: $1,000 

Steep roofs, with pitches above 10:12 (40 degrees), add labor cost because our crews have to work slower to stay safe.

Roof Vents

Price impact: $150 per vent

We often have to relocate roof vents so that our solar systems are laid out in beautiful, contiguous rows–no wants a plumbing vent poking up through the middle of their solar array!

Multiple Roofs

Price impact: $400 per roof (after the 1st)

Installing across multiple roofs is sometimes necessary but it adds labor because our teams have to reset their safety systems and install additional junction boxes and conduit to connect all of the arrays.

Metal Roofs

Price impact: $30 per panel 

Metal roofs require additional “c-clamps” for the racking system which adds to the material cost of the system.


After reading this you (hopefully) have a better understanding of how much solar costs and why it costs that much. To recap, the most important points are:

  • A good ball park price for a home solar system is $27,000
  • Available incentives reduce the cost of home solar by 30% for residential customers
  • Solar is extremely customizable, your system could be anywhere from $8,000 to…infinity. It all comes down to your home, your goals, and your budget.
  • The biggest cost variables for solar are system size, panel type, install location (ground vs roof), and battery storage.

Now that the cost of home solar is more clear, you’re probably jumping to our second most popular questions: “What size solar system do you actually need?” or “What financing options are out there for home solar in NC?“. 

If you’re ready to get started with your home solar system, don’t hesitate to reach out by clicking the get started button and filling out a form below or schedule a call with one of our solar educators

Calculate Your Solar Savings

See solar on your home! Our solar calculator uses your home address, the details you provide, and LIDAR satellite technology (with a dash of AI) to give you a ballpark estimate of how much you could save by going solar.

Tax Advice Disclaimer Southern Energy Management is a company of solar installers, energy raters, building scientist, dogs, dreamers, and entrepreneurs but we are not a tax provider, financial adviser, or legal attorney. This post is definitely not professional tax advice or any other type of professional financial guidance. Your actual tax benefits from a solar system may be different than what we’ve estimated here, so please consult a tax professional before you make any decisions. If you don’t have a tax professional on hand, don’t worry, we keepspecializing in energy and tax issues on retainer that you can use as a resource.

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