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How much do rooftop solar panels cost?

7 min read

rooftop solar cost

By now you likely know how solar panels work, have explored the pros and cons of solar, and are starting to wonder how much it might cost to add rooftop solar to your home.

Rooftop Solar Panels Are Not One Size Fits All

When it comes time to get an estimate for your rooftop solar system, keep in mind that solar is not one size fits all. A properly designed rooftop solar system should be custom designed for your home, taking into account the pitch of your roof, the angle of your house relative to the Sun, shading from nearby trees throughout the day, roof impediments (like chimneys and vents), and your household’s typical energy usage. Solar providers use this information to determine the ideal size of the system and placement of the panels on the roof of your home. Solar rebates and subsidies available will also factor into the average cost of a system, as will any add-ons you opt to purchase with your system.

A qualified solar provider should thoroughly explain your estimate to you before you decide to buy and install rooftop solar panels. That’s the best time to ask questions about your new system before you sign up.

The good news is that the average price of rooftop solar systems has continued to drop over the past few years, making installing solar panels more affordable than ever, especially when you consider all of the easy buying options available to homeowners today.

Buying Options for Rooftop Solar


There are essentially three ways to purchase a new rooftop solar system today: cash purchase, loan/financing, and Power Purchase Agreement (or a lease in areas where Power Purchase Agreements are not available).

Cash Purchase

It doesn’t get much simpler than this. With a cash purchase, you buy the rooftop solar system outright in one transaction and avoid having to pay any interest or monthly fees.

The primary advantage of buying a rooftop solar system with cash is that you own the new system outright from the get go, and after installation can claim it as a permanent fixture on top of your home, immediately increasing your home’s value.

When getting an estimate from a solar provider for a cash purchase, be sure to inquire about installation, maintenance, and operation fees. Some solar providers will cover installation, operation, and maintenance fees while others will provide that service for an additional charge. Keep in mind that rooftop solar panels require very little maintenance and typically come with 20-year or longer warranties, so this shouldn’t be a deal breaker either way.

Loan/Financing

If buying a new solar system outright won’t work with your budget, you might want to consider financing the amount through a loan. With a loan, you still obtain ownership of the rooftop solar panels and pay for your system over time, just as you would with any other type of loan, while still benefiting from renewable energy and electricity savings along the way. Most solar loans require little to no upfront costs, which makes solar truly affordable for any budget.

There are also many options for solar loans. Some solar companies work with a third-party loan provider and special government programs also grant loans specifically for rooftop solar panels. For example, PACE (Property Assessed Clean Energy) is a government program that finances projects that increase energy efficiency. The PACE program varies by location, but in many places, homeowners can opt to pay for their rooftop solar panels through their property taxes. If none of these loan options work for you, you can apply for a personal loan through your bank or credit union.

Solar Power Purchase Agreement (PPA)

Most solar consumers in the U.S. today have a PPA. With a PPA, you don’t pay for the rooftop solar panels, but rather for the power your panels produce. The solar provider owns the rooftop solar panels, and the amount you pay is for the solar energy those panels create.

One way to understand PPAs is to think of the relationship you have with your electric utility company. Your electric utility creates electricity that you use and are billed for each month. With a solar PPA, it’s like having a power plant on your roof, only that power comes from a big ball of fire about 92.96 million miles away.

The actual amount you pay for the solar energy that’s produced on your roof depends on your location and the solar company you work with, but typically the solar company will charge you a lower rate for power than your electric utility. That’s how the savings work! Your home uses cleaner power, thanks to your solar system, and you get charged a lower average rate for that power, which can result in annual savings. It’s a pretty sweet deal for both you and the electric companies. The bitter part is that PPAs are not available in every state. But don’t worry, if a PPA is not available in your state, a solar lease might be.

Solar Lease

A solar lease is similar to a PPA in that you don’t pay any upfront costs for your rooftop solar panels, and typically the solar company takes care of installation, maintenance and warranty. However, instead of paying for the amount of energy the rooftop solar panels produce, with a solar lease you’re technically paying for the rooftop solar panels equipment itself. Don’t let that confuse you. You are not buying the solar energy system, you’re just paying to use the equipment as a service. Like a car or house rental, you’ll pay a fixed monthly payment for the property you are leasing from the solar company.

The best part about a solar lease is that a good company will guarantee its estimate on what the rooftop solar panels produce. That means that if the rooftop solar panels don’t produce as much energy as expected, the solar company will actually cut you a check for the difference!

Click here to jump to a handy chart that summarizes solar buying options available through Vivint Solar.

The (Not So) Fine Print

There are a couple of other points to consider when deciding whether to install a rooftop solar system. Most long-term commitments with companies require you to have a decent credit score. In order to obtain a loan for rooftop solar panels, you’ll typically need a credit score around 650, although that number can be different depending on the solar company you work with. If you have a lower credit score, other options like banks or credit unions might still approve a loan that some solar companies won’t. If you live in an area that allows PACE, your credit score isn’t a factor because the payments are built into your property taxes.

When it comes to buying a rooftop solar system, remember there are several incentives available for rooftop solar panel customers. If you purchase a solar energy system with cash or with a solar loan, you could be eligible to receive a tax credit for 30 percent of the cost of your rooftop solar panels if the system is in service by the end of 2019 (the credit steps down each year before phasing out after 2021). That means if your solar energy system costs $10,000, you would get a tax credit of approximately $3,000 for the year! There’s a variety of other credits that vary by state. Learn more about the different incentives available in various states and what could be available to you.

The incentives, tax credits, credit scores, interest rates and benefits of rooftop solar panels can be a lot to take in, but a good solar company will help you navigate all of this. They’ll be able to tell you the size of the system they’d recommend to install on your home and help you figure out which payment option will work best for you.

The point is, if you are serious about getting solar and want to have access to the many benefits it can provide, there are now several options in many states that make going solar easier than ever. Contact Vivint Solar today to find out if installing solar is right for you.

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