How Much Do Solar Panels Cost in 2026?

Reviewed by: Dylan DeSantis, SolarMetric
Last Updated: May 6, 2026

Quick Answer

A typical residential solar installation in 2026 costs $25,000–$35,000 before incentives for a 10 kW system — roughly $2.50–$3.50 per watt depending on your state, installer, and equipment. The federal 30% residential solar tax credit (Section 25D) expired December 31, 2025 under the One Big Beautiful Bill Act, so there is no longer a federal credit to offset that price. State rebates and utility incentives still exist in many markets and remain the primary path to reducing your out-of-pocket cost.

If you’re getting competitive quotes through a marketplace like EnergySage, you’ll likely land closer to $2.50/watt — the national median for quoted prices. If you go with a single installer without comparing, you’re probably paying closer to $3.50/watt, which is the national median for all cash purchases tracked by Lawrence Berkeley National Lab.

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Cost by System Size

The right system size depends on how much electricity you use. Most U.S. homes install between 6 kW and 12 kW of solar. Here’s what each system size costs in 2026 at the $2.50–$3.50/watt range:

System Size Typical Home Usage Low Estimate ($2.50/W) High Estimate ($3.50/W) Midpoint
6 kW ~600–800 kWh/month $15,000 $21,000 $18,000
8 kW ~800–1,000 kWh/month $20,000 $28,000 $24,000
10 kW ~1,000–1,200 kWh/month $25,000 $35,000 $30,000
12 kW ~1,200–1,500 kWh/month $30,000 $42,000 $36,000

Estimates are for a complete installed system including panels, inverter, racking, wiring, permitting, and labor. Battery storage is not included.

The wide range within each system size exists because installer pricing, labor rates, roof complexity, and panel brand all vary significantly by location. In California or Massachusetts — where labor is expensive and permitting is complex — you’ll be at the higher end. In Arizona or Texas, you’ll often land near the bottom.

Important 2026 note: The federal residential investment tax credit (30% of system cost) expired December 31, 2025. A $30,000 system that would have cost $21,000 after the federal credit in 2025 now costs the full $30,000. State-level credits and utility rebates still apply in many states — see the section below.

Cost by State

Solar pricing varies by 40–50% across states, driven by differences in labor rates, permitting complexity, local demand, and installer competition. States with more installer competition (Arizona, Texas, Florida) consistently show lower prices. States with complex permitting and high construction costs (California, Massachusetts, New York) are consistently more expensive.

The table below shows estimated per-watt costs and total cost for a typical 10 kW system in each of the top solar states, along with current residential electricity rates that determine how quickly the system pays back.

State Cost Per Watt 10 kW System Cost Avg. Electricity Rate
California $3.00–$3.75/W $30,000–$37,500 31.6¢/kWh
Texas $2.16–$2.50/W $21,600–$25,000 14.5¢/kWh
Florida $2.19–$2.60/W $21,900–$26,000 15.5¢/kWh
Arizona $2.09–$2.50/W $20,900–$25,000 14.5¢/kWh
New Jersey $2.81–$3.20/W $28,100–$32,000 22.0¢/kWh
Massachusetts $3.00–$3.40/W $30,000–$34,000 31.5¢/kWh
New York $3.05–$3.25/W $30,500–$32,500 25.0¢/kWh
Nevada $2.50–$2.80/W $25,000–$28,000 16.0¢/kWh
Colorado $2.60–$2.90/W $26,000–$29,000 17.0¢/kWh
Georgia $2.50–$2.75/W $25,000–$27,500 15.0¢/kWh
North Carolina $2.55–$2.80/W $25,500–$28,000 13.5¢/kWh
Virginia $2.60–$2.90/W $26,000–$29,000 14.0¢/kWh
Maryland $2.70–$3.00/W $27,000–$30,000 18.0¢/kWh
Oregon $2.70–$3.00/W $27,000–$30,000 15.0¢/kWh
Washington $2.70–$3.00/W $27,000–$30,000 12.0¢/kWh

Sources: EnergySage 2025 Solar Market Report (H2 2025 median quoted prices); EIA residential electricity rate data 2025–2026.

A few observations from this table worth calling out:

California and Massachusetts are expensive to install but fast to pay back. A $33,000 system in California saves roughly $3,000–$4,000 per year in electricity at 31.6¢/kWh. That’s an 8–11 year payback — reasonable given that California also has strong net metering and the state’s Self-Generation Incentive Program (SGIP) for batteries.

Texas and Arizona are cheap to install but slow to pay back. A $23,000 system in Texas only saves $1,200–$1,800 per year at 14.5¢/kWh. That’s a 13–19 year payback before other incentives. Both states also have weaker net metering policies than California, which further reduces annual savings.

Washington is the most challenging case. Low installation costs are partially offset by the lowest electricity rates in the country (~12¢/kWh). If you’re in Seattle, solar’s economics are tighter than national averages suggest — run the numbers carefully before committing.

What Affects the Final Price

Five factors drive the difference between a $25,000 quote and a $40,000 quote for the same output system:

1. Panel Brand and Efficiency

Commodity panels from Tier 2 brands like Canadian Solar or Jinko Solar cost roughly $0.30–$0.50 per watt less than premium options from REC, Panasonic, or SunPower. For a 10 kW system, that’s a $3,000–$5,000 price difference. Premium panels typically carry better warranties (25–30 years product warranty vs. 10–12 years) and higher efficiency (21–23% vs. 18–20%), which matters if your roof space is limited.

There’s no universal right answer. If you have plenty of roof space and want the lowest upfront cost, Tier 2 panels work fine. If you have a small south-facing roof section and need every watt you can fit, premium panels earn their premium.

2. Inverter Type

String inverters are the cheapest option ($1,000–$2,000 for a system inverter), but they limit the whole array when one panel is shaded. Microinverters (Enphase is the market leader) or DC optimizers (SolarEdge) add $1,500–$3,500 to the system cost but maximize output in shade and simplify monitoring. Most U.S. installers now default to Enphase microinverters or SolarEdge with optimizers. If shade isn’t an issue, a string inverter is fine and saves real money.

3. Roof Complexity

A simple gable roof with one south-facing pitch is the cheapest installation. Add dormers, multiple roof planes, steep pitch, or older tile/slate roofing, and labor costs climb. Complex roofs can add $2,000–$5,000 to installation cost compared to a straightforward shingle roof. If your roof needs repairs before install, those costs fall entirely on you — the installer won’t finance or include them.

4. Battery Storage

A home battery (Tesla Powerwall 3, Enphase IQ Battery 5P, or similar) adds $10,000–$18,000 to the system cost for a single battery. Most homeowners don’t need storage for basic solar — the grid acts as your “battery” through net metering. Storage makes sense if you live in an area with frequent outages, poor net metering, or time-of-use rates where selling power back at peak times is valuable. See best solar batteries for a full comparison.

5. Installer Margin

This one gets less attention than it deserves. According to EnergySage’s cost analysis, installer profit and overhead accounts for roughly 46% of total installation cost. Different installers have very different overhead structures. A local installer with low overhead may quote $2.60/watt for the same job a large national company quotes at $3.40/watt. This is the single biggest lever you have in controlling cost: get multiple quotes.

Understanding Cost Per Watt

Cost per watt ($/W) is the cleanest way to compare solar quotes because it normalizes for system size. If one installer quotes $28,000 for an 8 kW system and another quotes $32,000 for a 10 kW system, the $/W makes comparison easy: $3.50/W vs. $3.20/W.

Here’s what the numbers mean in 2026:

  • Under $2.50/W: Unusually cheap. Either you found a highly competitive market (Arizona, Texas), you’re getting a commodity build with low-end equipment, or something is off. Verify warranty terms and check the installer’s reviews.
  • $2.50–$3.00/W: Competitive. This is the EnergySage marketplace range. You’re getting decent equipment at a fair price.
  • $3.00–$3.50/W: Average to high. Normal in high-cost states (California, Massachusetts, New York). In lower-cost states, this suggests you may not have enough competing quotes.
  • Over $3.50/W: High. The LBL national median for all residential systems is around $3.50/W — meaning half of all systems cost more than this. But if you’re getting this price, compare it against more quotes.

How to Reduce Your Cost in 2026

The federal 30% residential credit expired at the end of 2025, but meaningful incentives still exist at the state and utility level. Here’s what to look for:

State Tax Credits

Several states have their own income tax credits that partially replace the expired federal credit:

  • New York: 25% state tax credit (up to $5,000 maximum)
  • Maryland: 30% state tax credit (up to $5,000 maximum), plus additional utility rebates
  • Massachusetts: 15% state tax credit (up to $1,000 — a small credit, not a substitute for the federal credit)
  • Oregon: Business Energy Tax Credit for residential solar through specific programs; check Oregon DOE
  • Montana, South Carolina, and others maintain state-level credits — check your state’s department of revenue

Utility Rebates

Many utilities offer upfront rebates of $200–$1,500 per kilowatt installed. These are independent of state or federal credits. Check with your utility before signing an installation contract — you typically need to apply before install, not after.

SREC Markets

In New Jersey, Massachusetts, Pennsylvania, Ohio, Maryland, and D.C., Solar Renewable Energy Certificates (SRECs) generate ongoing income. Every 1,000 kWh your system produces generates one SREC, which you can sell. In New Jersey, SRECs have traded above $200 in recent years. Over a 25-year system life, SREC income can add up to $5,000–$20,000 depending on the market.

Net Metering

Net metering lets you export excess power to the grid and receive credit on your bill — effectively using the grid as free storage. Policy varies significantly by state and utility. California moved to NEM 3.0 in 2023, which significantly reduced the value of exported power (from ~$0.30/kWh to roughly $0.08/kWh). In most other states, retail-rate net metering (1:1 credit) still applies.

Financing: The Lease Alternative

With the federal residential ITC now expired, solar leases and PPAs have become relatively more attractive. Under a lease, the installer owns the system and captures the commercial Investment Tax Credit (which remains through the 48E business credit path at least through 2027), then passes savings to you through a lower electricity rate. You don’t own the asset, can’t claim depreciation, and selling the home adds complexity — but you also have zero upfront cost and no responsibility for maintenance or performance.

If you can afford to own, ownership still makes more financial sense over a 20-year period. If cash flow is the constraint, a lease is worth evaluating.

Is the Cheapest Quote the Best?

No. And this is where a lot of homeowners get burned.

The cheapest quote typically gets that way through one of three mechanisms:

  1. Lower-tier equipment — Panels from manufacturers with weaker financial stability or shorter warranties. A panel warranty is only as good as the company behind it (ask what happened to SunPower warranty holders after their 2024 bankruptcy).

  2. Undersized system — A 6 kW system is cheaper than an 8 kW system. Some installers will quote a smaller system to win the job, knowing your utility bill won’t drop as much as you expect.

  3. Installer with lower overhead — and sometimes lower accountability. A brand-new installer may quote aggressively to build volume. This isn’t necessarily bad, but check their license, insurance, workmanship warranty duration, and BBB standing before signing.

What you’re actually buying is a 25-year asset that needs to produce power reliably and have someone to call if it doesn’t. Saving $2,000 on equipment that carries a 10-year warranty instead of 25 may cost you more in the long run.

The right comparison: Get 3–5 quotes and compare them on $/watt, panel manufacturer and model, inverter type, workmanship warranty length (minimum 10 years, 25 years is best-in-class), and production guarantee. Then choose the best value — not just the lowest price.

What You’re Actually Paying For

Solar installers don’t publish itemized invoices, but EnergySage’s cost analysis breaks down where your money goes for a typical residential installation:

Cost Component % of Total Example (10 kW / $30,000)
Solar panels ~25% ~$7,500
Inverter(s) ~10% ~$3,000
Mounting hardware ~5% ~$1,500
Electrical BOS (wiring, conduit) ~7% ~$2,100
Labor ~7% ~$2,100
Permitting & interconnection ~3% ~$900
Sales, overhead, profit ~43% ~$12,900

That last line explains why getting multiple quotes matters so much. The physical equipment is roughly the same across installers — the installer’s overhead and margin is where the variability lives.

FAQ

How much do solar panels cost for the average home?
For a typical U.S. home using 900–1,100 kWh/month, a 8–10 kW system is standard. At $2.50–$3.50/watt, that’s $20,000–$35,000 installed. The wide range reflects regional differences — a 10 kW system in Arizona runs $21,000–$25,000; the same system in Massachusetts runs $30,000–$34,000.

Is there still a federal tax credit for solar in 2026?
No — the residential 30% solar tax credit (Section 25D) expired December 31, 2025. The One Big Beautiful Bill Act, signed July 4, 2025, ended the IRA’s long-term extension of the credit with no phase-out. State tax credits still exist in some states. Third-party-owned systems (leases, PPAs) still receive a business-side credit, but homeowners do not receive the personal tax credit. See federal solar tax credit guide for the full history and current state.

How long does it take for solar panels to pay for themselves?
The national average payback period is 8–12 years. States with high electricity rates (California, Massachusetts, New York, Connecticut) pay back faster — often 7–10 years. States with low rates (Texas, Virginia, North Carolina) typically run 12–18 years. Is solar worth it? has state-by-state payback estimates.

What size solar system do I need?
Start with your last 12 months of electricity bills. Divide your total annual usage (in kWh) by 1,200 to get an approximate system size in kW. A home using 14,400 kWh/year needs roughly a 12 kW system. Your installer will size it precisely based on your roof orientation, shading, and local sun hours.

Does solar add value to a home?
Yes. NREL research consistently shows homes with owned solar systems sell for a premium — historically around $3–$4 per watt of installed capacity, or roughly $3,000–$4,000 for a typical 10 kW system. That said, leased systems complicate the sale, as the new owner must either assume the lease or you must buy it out before closing.

How much does one solar panel cost?
A single residential solar panel (400–450W capacity) costs $150–$300 for the panel itself. But a single panel isn’t useful — you need an inverter, racking, wiring, and a licensed installer to make it work. Always think in terms of system cost per watt rather than single-panel cost.

What’s the cheapest state to install solar?
Arizona and Texas consistently have the lowest installed costs, averaging $2.09–$2.20/watt. Low labor rates, simple permitting, and high installer competition keep prices down. However, low electricity rates in both states also mean slower payback periods.

How We Researched This

SolarMetric compiles solar cost data from four primary sources:

  • EnergySage Solar Market Report (H2 2025): Median quoted prices from installer bids on the EnergySage marketplace platform, representing 11.8 kW average system size. EnergySage’s prices are lower than national medians because the platform incentivizes competition.
  • Lawrence Berkeley National Laboratory “Tracking the Sun” 2024 Edition: Bottom-up cost benchmarking for residential PV systems based on 3.7 million installed systems through year-end 2023. LBL’s figures represent the broader market including single-quote installations.
  • U.S. Energy Information Administration (EIA): Residential electricity rate data by state for 2025–2026, used to calculate payback periods and annual savings estimates.
  • NREL Solar Installed System Cost Analysis: Bottom-up benchmark methodology for residential, commercial, and utility-scale systems.

State-by-state per-watt costs are derived from EnergySage’s state-level data pages, corroborated with NREL regional data where available. Individual quotes vary significantly — these figures represent typical ranges, not guarantees of what any individual homeowner will pay.

Sources

Related guides: Best Solar Companies → | Federal Solar Tax Credit Guide → | Is Solar Worth It? →

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