Most homeowners and businesses who install solar panels have the goal of reducing their monthly power bills. Solar power can also reduce the environmental footprint of a property, which is a great feature in locations with clean energy mandates.
Governments are becoming more aware of the benefits of solar energy, and they may also offer tax benefits for individuals and corporations who use it. The US has a nationwide tax incentive for solar power, which is officially called the Federal Solar Investment Tax Credit (ITC).
You have most likely seen in the news that the US is facing the highest inflation in 40 years, and the energy sector has been one of the most affected. Between April 2021 and 2022, energy costs in general increased by 30.3%, according to the latest Consumer Price Index data from the US Bureau of Labor Statistics.
Here is a summary of the 12-month cost increase for energy products and services used by homeowners every day:
Electricity prices have increased by 11%
Piped natural gas prices have increased by 22.7%
Gasoline prices have increased by 43.6%
Solar panels can operate independently from these energy inputs. After the initial investment is covered, they can last for over 25 years with minimal maintenance, and many brands are now offering long-term warranties.
When using solar power, you are not only saving electricity at the current price, but also the impact of any kWh price increases during the following decades.
If you plan to build a new home or own a property that needs a roof replacement soon, you can also consider a solar roof.
The Solar Energy Industries Association (SEIA) publishes a quarterly report about the US solar industry, which is officially called the Solar Market Insight Report.
The latest edition was published on March 10, 2022, and it provides detailed information through the end of fourth quarter of 2021. The SMI report covers the installed PV capacity and average costs per market segment: residential, commercial, community, and utility-scale.
Along with Wood Mackenzie, a global consulting firm with ample experience in the renewables industry, the SEIA forecasts how the US solar industry could grow in the near future.
SEIA analyzes the potential impact of current opportunities and threats, such as the disruption of global supply chains, and how these factors could impact solar installations and their costs.
Here we will provide a summary of the main points in the latest Solar Market Insight Report, focusing on solar costs in the residential sector. We will also cover the installed capacity and number of installations in 2021, which was a record-breaking year for home solar power, despite COVID-19 and global supply chain issues.
What Is the Cost of Solar Power for Homes in 2022?
Each quarter, the SEIA estimates the average cost of solar power across the three main market segments: residential, commercial, and utility scale. To achieve this, they track the wholesale price of solar components, while conducting interviews. They also analyze the installed cost of standard mono-PERC solar panels and other high-efficiency modules.
According to the latest report from March 10, US homeowners can expect to pay $3.10 per watt of installed capacity. The following table summarizes the average prices you can expect for some common system sizes, based on this figure.