Are Solar Panels Worth It?

For a 6.5 kW installation, the average solar panel costs range from $16,600 to $20,500, according to our research comparing information from the U.S. Department of Energy and prices from more than 50 solar panel manufacturers.

This size of system is average for standard, midsized household needs. Depending on the size and needs of other homes, costs can range from $7,700 to more than $34,000. For a better way to estimate, consider that solar panels cost between $2.55 and $3.15 per watt. Although the panels themselves cost between $0.30 and $0.90 per watt, labor and other fees (including permits) add to the final price.

Ongoing Solar Costs

Solar panels are regarded to be relatively low-maintenance and long-lasting. Still, it’s good to be aware of some recurring costs that you might encounter.

Maintenance: Solar panels are designed for longevity and durability. But to keep them working as efficiently as possible, routine cleaning and maintenance is recommended. Depending on where you live, the size of your solar panel installation and other factors, annual maintenance costs an average of $140 to $180.

Monitoring: Solar panel monitoring services are often app-based and allow users to track energy usage and check in on the status of their solar panels. Many companies include this service complimentary with the solar panel installation. If not, solar load controller monitors are available for about $150 to $500.

Repairs: Although terms and conditions vary, solar panels are often covered by long-term warranties that may cover repair or replacement costs if issues arise. Be sure to read the fine print of a contract to understand the limitations of any parts or labor warranties.

Based on our research, it takes an average of four to 13 years for most solar panel installations to pay for themselves. How long it takes depends on the size and cost of the system as well as personal factors, such as net metering policies, climate conditions, home type and more.

To assess how long it takes to break even on solar panels, you need to determine average monthly energy costs. “The higher the bills, the more savings the homeowner is likely to see from switching to solar,” says Landon Wimmer, a solar expert and owner of Empower Home Services. “Before installing solar panels, we will review the past 12 months of energy usage to determine the right size of the system for the home.”

Then, assuming those costs will be covered by the energy produced by a properly sized solar panel installation and utility company net metering, calculate how many months of savings it takes to catch up to the solar panel investment.

For example, say a 6.5 kW system costs $12,000 after accounting for the current 30% federal solar tax credit. If that homeowner had been paying $100 per month for electricity and that is now covered by the solar panels, the homeowner saves $1,200 per year—and pays for the solar panels in 10 years.

A well-planned solar panel installation should cover the costs of your electricity bill, so monthly savings will be a reflection of what you’ve been spending. “A copy of a recent utility bill will help a lot,” says Ben Zook, the owner of Belmont Solar and a solar panel installation designer. “Electricity costs often vary by area [and] usage type.”

In winter months when the days are shorter or in seasons when there is less direct sunlight, the solar panels may not produce enough electricity to cover needs. However, if your solar panels are tied to the grid and your utility company has a net metering program, the excess energy you produce in some months can cover your shortage during other seasons.

The most valuable and widespread solar incentive is the federal solar tax credit (ITC), which allows homeowners who install solar panels to get a 30% tax credit during the tax season following the year their installation was completed and activated. For example, if a system cost $15,000 to install, the homeowner can get a tax credit of $4,500, bringing their all-in cost down to $10,500.

The federal program was previously authorized for a 30% tax credit through 2032. However, the passage of the One Big Beautiful Bill Act in July 2025 eliminated funding for this program and set it to end after 2025, with no phaseout period. That means homeowners must install and activate solar panel systems by December 31, 2025, if they want to claim the tax credit. As of August 2025, this change has not been reflected on the IRS or Department of Energy’s websites.

Beyond that, tax credits and incentives vary by state and local governments. Common incentives include tax exemptions, rebates and net metering.

According to our 2024 survey of 1,000 United States customers who installed solar panels within the past five years, 84% vouched for solar panels—saying, yes, they would recommend them to family or friends.

On a purely financial level, there is about a 10% solar panel return on investment rate,which can be valuable even if you don’t stay in the home long-term. A standard 6 kW system can also save about $125 per month in electricity costs.

State or local tax incentives may make solar panels more financially viable and appealing. As you begin researching, consider what programs you may be eligible for and inquire about the process with any installer you consider.

Then there are the environmental benefits: Installing solar panels lessens your demand on the traditional energy grid and uses sustainable energy from the sun. “Sometimes, just doing the right thing for this generation and the next can help make the deciding factor,” Zook tells Forbes Home. “Sharing your specific goals and knowing the why is very important.”

Solar panels are a significant investment. While these upfront costs can be returned in time through energy bill savings, it’s not always feasible or practical to pay that much or enter into a financing agreement.

Some regions or specific addresses are also not as well-suited to solar panels. Because solar panels work best with direct sunlight, homes that are heavily shaded or experience more cloud or night sky conditions will not produce as much energy. “Shading makes the biggest difference,” Zook says “The amount of available surface area also matters. Exact orientation usually does not make much of a difference.”

Regional and Local Factors That Can Affect Solar Panel ROI

Geo-specific climate conditions affect the amount of energy produced by solar panels. In turn, this can extend the amount of time it takes to recoup the investment. But those aren’t the only factors that can affect solar panel return on investment.

Local Credits or Incentives: Explore incentives available in your state, your city and from your utility company. One-time tax credits or rebates can be helpful, but a long-term net metering policy can be even more financially valuable.

Electricity Costs: There is a better return on investment with solar panels in areas with high electricity rates. The bigger the electricity bill you are replacing each month, the faster you will see the solar panels pay for themselves.

Market Interest: Local market attitudes can affect how much adding solar panels will increase the value of your home.

If you are interested in purchasing and installing solar panels, 2025 is the time to do it so that you can use the 30% federal solar tax credit to bring down your costs. Beyond that point, solar panels bring good value—both in terms of energy savings and the increase to a home’s value. It may take longer for solar panels to pay for themselves as costs increase without the federal tax credit, but they can still be worth it for financial and environmental reasons.