In 2021, the average residential solar panel installation cost was $20,000. Compared to 2011’s average of $50,000, that’s a staggering 60% decrease in only a decade. Additionally, there are plenty of cost-saving incentives available to curb these upfront expenses.
Still, you may be wondering if solar panels are worth it. After all, it’s no small investment. Keep reading for a breakdown of how much it costs to install solar panels in Texas, along with some crucial money-saving tips from Gexa Energy.
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Calculating the Average Cost of Solar Panel Installations
How much it costs to install solar panels depends on multiple factors, including your household’s electricity demand, daily hourly sunlight, panel materials, and local fees. Depending on your needs, you may be looking at upfront costs anywhere between $5,000 and $50,000 without financing.
Solar Panel Costs by Energy Usage
To estimate your solar requirements, you’ll want to determine your daily and hourly energy usage in kilowatt hours (kWh). For reference, the average U.S. household uses approximately 900 kWh monthly, which comes out to 30 kWh daily and 1.25 kWh hourly.
Next, let’s assume your home gets a daily average of four hours of sunlight exposure, and you purchase 325-watt panels. One 325-watt panel generates 1.3 kWh daily, meaning you would need at least 23 panels to generate enough power for your home (29.9 kWh daily).
Your useable roof area may impact costs as well. A large open space means you can buy larger panels at a lower price per panel. On the other hand, a limited area means you can use smaller panels with higher efficiency, which may save you more money in the long term.
Cost of Solar Panels in Texas
To put things in perspective for Texas homeowners, let’s look at the cost of a standard 6-kWh system. At an average price, this solar installation would cost about $14,820 before any incentives or electricity savings. With a 22% tax credit from the federal government valued at $3,260, the total expense for this installation would be $11,560.
Learn more about how many solar panels you need.
Solar Power Incentives
Thankfully, there are several methods for offsetting solar panel installation costs, including:
- Federal Solar Tax Credit: Eligible homeowners who install a system between 2022 and 2032 can claim 30% of solar panel costs. The credit will decrease to 26% in 2033 and 22% in 2034 is set to end in 2035.
- Monthly Payments: Financing options are available, if spreading out the expenses in monthly installments makes sense for your financial situation. (Leasing is also an option, but you won’t own the solar panels, meaning you won’t get the tax credit.)
- Net Metering: Gexa offers solar plans with net metering, sometimes known as a solar buyback plan. When solar panels create excess electricity, the net meter records how much electricity gets sent back to the grid and credits you back accordingly.
- Property Tax Exemption: A solar installation could increase your home’s value. In Texas, you won’t be responsible for increased property tax for any added value from the solar system, thanks to a statewide property tax exemption.
If you’re interested in learning more about reducing the initial investment of rooftop solar, check out our guide on Texas solar incentives.
Solar Panel Payback Period
Worried about how long it will take to break even on your investment? While $20,000, $10,000, or even $5,000 is a significant investment, most solar installations pay off within 10 years. With solar systems lasting up to 50 years, you can be confident in reaping the rewards of solar for years to come.
Cost of Solar Panels by Type
The most common materials used for residential solar panels are monocrystalline and polycrystalline. Monocrystalline panels are more efficient, leading to more electricity savings over time, but are slightly more expensive upfront. Polycrystalline panels are more affordable upfront but are less efficient.
Related: Learn about solar electricity.
Solar Panel Cost vs. Fossil Fuels
As costs decrease, solar power is becoming a cost-competitive alternative to fossil fuels. According to the International Renewable Energy Agency, 62% of renewable energy projects added in 2020 were more competitive than new fossil fuel options. Wind power is also more affordable in many instances. Going green isn’t just good for the earth: it’s good for your wallet, too!
How Solar Power Could Lower Home Energy Costs
By drawing from solar panels to power your home, you are essentially using “free” energy. Depending on your current usage, switching to solar electricity could potentially save you hundreds or thousands of dollars on a yearly basis.
Solar electricity is more likely to reduce your energy charges if your panels have access to direct sunlight and are installed on a roof with a slope between 15 and 40 degrees. Other factors that may impact your monthly savings include local electricity prices and the size of your solar system.
Department of Energy Cutting Solar Panel Costs by 60% in 10 Years
The U.S. Department of Energy (DOE) wants to continue the trend of making solar power more affordable for everyday Americans. In 2021, the DOE announced its plans to slash costs of solar energy by 60% by 2030. With funding to improve performance and deploy new technologies, this initiative is part of the Biden Administration’s goal to transition the U.S. to 100% clean electricity by 2035.
Solar Panels in Texas by the Numbers
Awareness of solar electricity benefits is increasing across the country. But what does Texas’ solar situation look like? Here are the facts about Texas solar power in 2022:
- Prices: Fallen 50% over the last decade
- Solar Installed: 13,947 MW
- Enough Solar to Power: 1.6 million homes
- Growth Projection: 18,401 MW in the next 5 years
- Total Investment: $16.6 billion
- Percentage of Electricity from Solar: 3.75%
- Total Solar Companies: 506
- Solar Jobs: 10,088
Here at Gexa Energy, we provide many Texas homeowners with cost-effective, clean solar plans. In fact, all our residential plans are 100% green. Sign up for solar energy today!
