Per Watt Price Coming Down

Published on June 5, 2009 by Tor a.k.a. "Solar Fred".
Categories: Affordable Solar, Buying Solar.

Over the last couple of years, I’ve been telling people to expect to pay between $8 to $10 per watt for your installed solar system before any rebates or tax incentives. I’m revising today. A typical home owner should now be paying between $6 and $8/watt DC before any rebates or discounts. I’ve also seen in the $5.50-$6 range in Colorado.

So what does that mean? It means that for an average size 4000 watt (4KW) system, the non-subsidized installed price of solar has come down from as high as $40,000 ($10 x 4000 watts) to as low as $24,000 ($6 x 4000). That’s huge price cut, and again doesn’t include the rebates and tax incentives, which could cut that price in 50% or even 60% if you live in certain parts of the country. (To find out about your specific state and utility incentives, visit www.dsireusa.org/solar.)

The above being said, that low side of $6 to $7/watt is for ideal solar conditions and roofs, so it’s definitely going to differ. Why? Some installers buy panels through distributors–who need to make a profit–while others buy direct from manufacturers, thus cutting out the middle person. There’s also the matter of rent, labor costs, insurance, etc, which vary widely depending on where you live. Also, your home potential for solar can also make things more or less expensive.

So, why am I revising this price estimate before regional and federal incentives? Mainly, it’s due to Solar Buzz, which surveys solar panel prices, and from my recent conversations with installers and emails from readers who are asking me if they are being quoted a reasonable price.

Due to overproduction of solar panels and the economy, Solar Buzz is currently showing the lowest price for solar panels as $2.74/watt to $3.26/watt, depending on the type of panel. Previously, it was hovering around $4/watt range. Again, this price does not include labor, other parts, or rebates, but does contribute to costs coming down.

On the installed retail side, I’ve been pleasantly surprised that the quoted price to people contacting me is often between $6.50 and $8.50/watt before their state/utility rebates.

So take this as being a non-scientific anecdotal new price point. If you’re looking at a solar quote, I would be looking for $6 to $8/watt or less in competitive markets for homeowners– and probably much less for large commercial installations that don’t finance through a commercial solar PPA.

SolarFred Caution: Compare quotes apples to apples. Some installers may give you a $ per DC watt quote, while others will give you per $ AC watt. They’re just different ways of measuring the power coming into your home. What I’m talking about is per $6 to $8 DC Watt, so ask all quotes to be in DC so you can make a fair comparison between quotes.

photo:flickr/Jeremy Levine Design

What’s the Diff? Solar Lease vs. Solar PPA »« Solar Cash: New Carolinas Subsidy