How much should rooftop solar cost?

Bottom Line Up Front (BLUF): Every home and home owner is different therefore every rooftop solar system will be different. There is no one-size-fits-all.

One of the reasons I started Tucson Solar Insider is because I felt that there are some low-integrity types that try to take advantage of unwitting home owners.

One area that manifests in is that of getting quotes from a solar company. There is a real issue to understand here for a home owner that I would like to discuss…

I can’t speak for the average home owner but I am capable of getting really defensive really quick when I encounter sales people. Especially those who knock on my door or call my phone.

My default reaction is ‘shields up’.
Usually, all I want is information-
not a sales person trying to twist my words against me. I would rather ‘look into it’ on my own than have someone trying to ask me leading questions.

This is all learned behavior over the years because the sales industry is what it is. The ones that struggle push harder and most sales folks struggle. The 80/20 rule seems to reign supreme in many areas, including the sales industry so it is likely that most of the sales folks you’ve dealt with have learned some behaviors that cause a resistance in you to build up.

Anyways, long talk for a simple idea-
Many home owners (if they are like me) might respond to a solar sales team with something like ‘send me the proposal’ (or estimate, or quote). On the surface that sounds reasonable- give me the written paperwork and I will review it in privacy and on my schedule.

But there’s a huge problem with that.

-Every home is different (roof size, orientation to sun, shading, penetrations, type, age, condition, etc.).
-Every home owner is different (wants to go off-grid style with batteries, wants to just reduce future increases in power bills, something in between, etc.).
-Every finance situation is different (paying cash, downpayment and a loan, lease, Power Purchase Agreement, tax status, etc.)
-Every home and home owner has a unique power usage requirement, and some have future plans like adding electric cars or heat pumps to replace gas furnaces, etc.

The is simply no way to come up with a rooftop solar system that is designed to meet a particular home/home owner’s needs and desires without first understanding those unique needs and desires.

Without an accurately designed system proposal, it is impossible to calculate costs and timelines. For example- consider batteries are expensive and also might have long lead times to get the equipment in. If the solar company has everything in their supply chain lined up well, they might be able to give you a with and without battery estimate and timeline- but that’s just one option among many.

More often than not, when a sales person hears a customer say ‘send me the proposal’ they tend to assume the customer is price shopping. Makes sense, right? It sounds like the customer is saying they want to see the proposal to compare to other proposals to me…

This has a negative effect- it leads sales teams to put together the smallest and least costly proposal together and it may not meet the needs of the home owner at all. When this happens and the home owner chooses based on price, they often get a system that doesn’t perform the way they assumed it would.

So, if I haven’t said it before- a rooftop solar power system is a rather complex thing that must be designed specifically for the home and home owner’s needs and intentions. We’re talking about a system that will last far longer than most cars or even longer than most home owners own the home.

Getting the design right at the beginning is critical.

I imagine you’re like “OKAY!, we get it” at this point, if not, I haven’t done my job that well…

Anyways, all that said, how much should a rooftop solar system cost?

Very generally they could go anywhere between 12-15K on the low end all the way up to 50K or more.
Systems with batteries cost more, obviously…

One way to better estimate for your home might be to try to figure out how big the system you would need, then use about 3.00 per watt to figure out what that system might cost (without batteries).

So to estimate for a 10kW rooftop solar power system it would be 10,000 x $3.00 = $30,000 total cost to get the system designed, installed, and power turned on.

Remember, the Investment Tax Credit for ‘clean energy’ allows for 30% tax credit- in this case 30% of $30,000 would be $9,000 that could ultimately reduce the ‘net price’ of the system to $21,000 (but the tax credit doesn’t work well for those folks who don’t pay a lot of taxes in the first place- so get tax advice from a qualified professional, NOT the sales team and definitely NOT ME).

More-

Assuming a loan on the system- the monthly payment can often be right around the cost the home owner was already paying for their power bill. In this scenario, making the switch to rooftop solar is almost a ‘wash’. No (or little) new money is being spent, but the home owner starts to build equity in the rooftop solar power system.

One popular was to try to make sense of it all is to divide the system cost by the money it saves you to figure out the payback period- the number of years it takes to pay for itself…

A quick example of a no-battery system- completely made up for illustration only.

Power bill averages $200 a month.
Solar system cost $30,000
ITC credit works for this home owner- $9,000
Monthly electric bill after solar installed- $25 a month
Monthly savings- $175
$30,000-$9,000 = $21,000
$21,000/$175= 120 months or 10 years

I think the correct way to look at this-

At the ten year mark, the home owner has spent the same amount of money but in one scenario they have nothing to show for it, and in the other- they have complete ownership of the rooftop solar system that should have 10-15 (or more) years of good productivity left.

Another factor to consider is for the duration the home makes and uses it’s own power, the power bill is not susceptible to price increases from inflation or random monopolistic utility fee increases… it has the effect of price locking the homes power bill for more than two decades.

Anyways, I’ve provided an extreme pay back period example. Typical payback periods fall more along the 7-9 year timeframe.

To me, I look at it this way- I want a rooftop solar system that allows me to make my electric bill go to zero (cannot in Tucson, TEP connection fees will always apply). I want the system to be paid off based on the concept above at longest 10 years. I might be willing to accept a longer pay off period for the benefit of a battery and disconnect switch so that I could truly operate ‘off grid’ if I needed to (blackouts).

This would lock in my power bill for, lets say the 10 years of payback, and then significantly reduce my power bill for the following 10-15 years as I got free power from something I’ve already paid off and own free and clear.

Anyways, just an idea.

If you are looking into rooftop solar I have a book coming soon that will help you navigate the solar marketplace and help keep you safe from the Solar Sales Bros. Click here to be notified when Tucson Solar Insider Desk Guide for Solar is released.

Be Good!
Curtis