When you hear North Carolina, you might not think “leader in solar energy.” But North Carolina’s commitment to solar energy is steadily increasing, with 5% of the state’s electrical needs met by the sun. The Tar Heel State currently has the second-largest solar capacity installed in the United States.
In 2020, a 5 kilowatt (kW) solar installation in North Carolina averages between $12,112 and $16,388 in cost, with an average gross price of $14,250. When you factor in the money-saving incentives and tax credits available, this estimate will drop significantly. For more information on the cost of going solar in North Carolina, read on!
Primary factors that determine costs
Size of the system
Your first step should be determining how many solar panels you’ll need. Start by looking at your home’s energy needs, and think about how much electricity you want your panels to cover. Many opt for 100% coverage, eliminating future electricity bills! The average U.S. home’s annual energy consumption is approximately 10,400 kWh (kilowatt-hours, so for full coverage, a similar-sized home would need between 28 and 34 250-watt panels (a popular size).
How much sunlight your area receives also affects the size system you will need. Raleigh averages 213 sunny days per year, above the national average of 205.
Building your solar energy system requires the following equipment:
Solar panels – Monocrystalline and polycrystalline are the two types of panels to choose from. They work similarly, monocrystalline with a more streamlined appearance, higher efficiency rating, and the higher cost associated with those benefits.
Racking – Solar panels don’t get installed directly onto your roof- instead, a racking system is installed on your roof, upon which the panels attach. The racking system serves two functions: it places your solar panels in the way that they’ll receive maximum energy from the sun and also avoids damaging your roof. Instead of roof racking, if you are in the market for a solar carport or ground mount solar, you can find a mounting system to fit your needs.
Inverters – Solar power is received as DC current, and the inverter switches it to AC power, which most homes are wired to use.
Performance monitoring system – This allows you to monitor how effectively your system is running. Performance monitoring systems measure how much energy your system produces per hour and helps identify any issues that may come up with your solar system.
Solar batteries – Solar power storage systems let homeowners use solar energy that their homes generate when sunlight isn’t available, such as at night or on cloudy days. That way, even if your town is more overcast, you can still benefit from solar power at those less sunny times.
The solar installation company
Nowadays, there is a wide array of installers in most areas. Installation quotes vary, so check with your local companies to get quotes for your area. Some companies charge high fees to cover their usage of top-notch equipment, while others spend more money on advertising and promotional items, transmitting that cost to the customer.
Take some time to research installers in your area. You can also check your neighborhood for solar panels and ask those neighbors how happy they were with their installers. Ask multiple installers for quotes, comparing their reviews and equipment used.
Price of Installation Breakdown
Panels have a reputation for being the most costly part of a solar system, but they only make up about 34% of your total cost. The major investment is actually in labor and overhead costs.
Thoroughly researching your purchase can save you up to thousands of dollars on installation costs. Large-scale companies already have a reputation, so they can charge more and not worry about competition from small-scale businesses. They also frequently charge to cover their extensive marketing and additional overhead expenses.
NC Solar Incentives, Tax Credits, and Rebates
North Carolina has no state tax credit, but the ITC is available to residents of each state in the union! The federal solar tax credit (ITC) is one of the most generous incentives nationwide. This tax credit allows you to cut the amount you pay in taxes by 26 percent of your solar system’s total cost. For example, a $15,000 system entitles you to a $3,900 credit towards your federal taxes. However, this incentive is phasing out- the credit amount will drop down to 22% after 2022 and phase out entirely after 2023.
Duke Energy offers homeowner customers the NC Solar Rebate to get started on solar installation. A 60 cent/Watt rebate is given towards systems up to 10 kW (kilowatts). If you build a 6 kW (kilowatt) system, your rebate amount would be $3,600! These rebates get used up quickly- 2019 has already closed for new applicants, so be sure to catch the 2020 application once it is released.
Solar Financing Options
Paying for your solar system upfront makes you the owner of your panels. Owning them gives you some benefits, not the least of which is an increased home value. If buying your system outright isn’t an option for you, consider solar loans and solar leases/PPAs. They both offer $0 down, and your monthly payments will most likely be less than your current electric bill.
Good news if you are looking to finance your solar panels- NC cities and counties offer low-interest rates that are not allowed to be longer than a 20-year term, with an interest rate cap set at 8 percent.
Other Factors that affect the cost
Solar power is a long-term investment, so think about the cost and savings you will encounter over the next twenty years or so. Good things to consider are:
- Cost of materials needed for installation
- Labor and overhead fees from your installer
- Maintenance fees
- Savings you’ll receive through federal, state and local tax credits
- The cost and average power usage on your current electric bills
- What you can expect to save on future bills
How long it takes to recover from your solar investment financially is known as the payback period. North Carolina’s average payback period is between 9.5-12.4 years. After you surpass the payback period, your savings on electricity would have paid for the full cost of your system. Solar panels often come with a 20-30 year warranty, which means you will generate clean, free electricity (other than connection fees) well after you hit the payback period.
Resident Electricity Rates in NC
North Carolina residents pay an average of 9.04 cents per kilowatt-hour (kWh). This is lower than the national average of 10.48 cents per kWh. Still, electricity is one payment you can eliminate if your solar panels cover your home’s full electrical needs. Keep the 20+ year lifespan of solar panels in mind, and you’ll see that this amounts to great savings on electric bills over time.
The size and configuration of your roof will likely affect your solar installation cost. Consider how steep your roof is, if it has one or multiple levels, and if skylights or other items are installed.
Your roof’s condition also matters. Since solar panels tend to last for 20-25 years, older roofs may need replacement. You can likely bundle this expense into your solar project, possibly qualifying for incentives and rebates.
Costs by City
Costs frequently vary by city or county, and North Carolina is no exception. Bladen County residents pay an average of $23,119 for a 5kW system, with costs going down to $16,183 after applying tax credits. On the other hand, Clay County residents pay an average of $13,642 for the same system or just $9,549 after the same tax credits are applied.
These figures are estimates, so it’s good to check with local installers and to remember that solar systems can be customized to fit your finances and power needs.
Solar power systems are generally quite self-sufficient, with just minimal maintenance needed throughout the year- cleaning and inspection. Regular cleaning of your system keeps it running smoothly, and an inspector will alert you if a problem arises.
The cost of professional cleaning services averages $3 – $10 per panel, or a flat rate of at least $100. Cleaning your own panels is an option- some people do- but be sure to speak with your installer before trying it yourself.
An annual inspection runs about $150 per year. During this inspection, the contractor searches for cracks or issues with the system—the price to repair solar panel averages around $650.
Warranties issued by the installation company frequently covers your system’s performance. If the damage is caused by inclement weather, your homeowner’s insurance may cover some of that expense. Be sure to ask a professional for more information, as warranties and insurance vary.
Home Value Increase
In a recent study, the average U.S. has a 4.1% increase in value when powered by solar energy. This estimate does vary from place to place, with more studies needed to determine accurate figures nationwide. According to a recent Zillow study, no city saw a drop in property value when the owner purchased solar panels outright (leasing may be another story).
How to Determine Your Solar Installation Costs
Solar Panel Cost Calculator
Project Sunroof is a great resource if you’re looking for estimates for your specific property and solar project. This cost calculator uses Google Earth images to view your roof’s shape and determine local weather, two key factors in solar costs. Project Sunroof then asks for your electric bill information to estimate how many solar panels you’d need and what the cost would be. You can then compare funding options for your project.
Solar energy in North Carolina is becoming more affordable than ever. The Tar Heel State grew it’s solar significantly more than other leading states. North Carolina has invested over $7.97 billion in solar energy and is expected to add 4,000 megawatts in the next five years.
This is a great time to make the switch to clean solar energy. Talk with an installer in your area to see if solar power is a good option for your home!
People also ask
Solar cost per watt?
The average cost for solar panels in North Carolina is $2.85 per watt. Prices in North Carolina have decreased and will likely continue to do so, but incentives such as the ITC and NC Solar Rebate won’t last.
Is solar really worth it in North Carolina?
In short, yes. Solar energy is a steadily increasing market and is only expanding. North Carolina benefits from a good amount of annual sunlight and a generous solar rebate.
Solar plans are highly customizable these days, so you’re likely to find one to fit your needs!
How many solar panels are needed to power a house?
This is determined by several factors, including solar panel wattage, home size, average energy usage, and how fully you want your electrical needs covered.
If your household uses an average of 10,400 kWh of electricity per year and has the common 250-watt solar panels, then an estimated 28-34 panels would fully cover your electrical needs.
How long do solar panels last?
Solar panels last for an average of 20-25 years. They may still produce electricity after this mark, but it will likely slow down. Solar panels are quite durable and don’t require much maintenance- just an annual cleaning and inspection to keep them running efficiently.
Take the time to research your panels’ warranties, ensuring they’re well-covered for defects and environmental damage that you may incur over the years.
Can I install my solar panels?
Yes, but with some risks. Home solar kits cost much less than professional installation but without comparable guarantees of quality, workmanship, and proper installation. Be sure to research how reputable the manufacturing company is.
Most installers are properly licensed and certified. They are also highly experienced with the installation process. Think about it before going this route- solar panel warranties usually cover work done by licensed professionals, not necessarily the DIY method. A professional’s experience comes with a higher price tag, but it might pay off in the long run.