Solar panel costs in the United States have dropped by more than 50% in the past decade, making 2025 one of the best times to invest in solar energy.
In 2025, the average installed cost of solar panels in the US is around $2.70 per watt, which means a typical 6 kW residential system costs about $16,200 before incentives, or $11,340 after the 30% federal tax credit.
Average Solar Panel Cost Breakdown
| System Size | Avg. Cost per Watt | Gross Cost (Before Tax Credit) | Net Cost (After 30% Credit) |
|---|---|---|---|
| 4 kW | $2.70 | ~$10,800 | ~$7,560 |
| 6 kW | $2.70 | ~$16,200 | ~$11,340 |
| 8 kW | $2.70 | ~$21,600 | ~$15,120 |
| 10 kW | $2.70 | ~$27,000 | ~$18,900 |
💡 Tip: Most US homes use 6–8 kW systems. Your actual price may vary depending on your state, installer, and available local incentives.
Solar Cost Calculator
Factors Affecting Solar Panel Cost
1. Location & Sunlight Hours
States like Arizona, Nevada, and California have lower effective costs because of higher energy production.
2. Equipment Type
Premium panels (SunPower, REC, Panasonic) cost more per watt but may last longer and have higher efficiency.
3. Installation & Labor
Local labor rates and roof complexity significantly affect installation costs.
4. Incentives & Rebates
The federal tax credit (ITC) is 30% through 2032, plus many states offer additional rebates or SRECs (Solar Renewable Energy Credits).
Federal & State Incentives (2025)
Federal Solar Tax Credit (ITC): 30% credit on total installed cost.
State Rebates: California, New York, Massachusetts, New Jersey, and others offer additional incentives.
Net Metering: Most states still allow you to earn credits for excess electricity sent back to the grid.
Typical Payback Period
With current prices and the 30% federal tax credit, average payback time is 6–8 years depending on your state and electricity rates.
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FAQ
Q1: What is the average cost of solar panels per watt in 2025?
A1: Around $2.70 per watt for residential systems in the US.
Q2: How much does a 6 kW solar system cost after incentives?
A2: Approximately $11,340 after the 30% federal tax credit.
Q3: Are solar panels cheaper in some states?
A3: Yes. States with lower labor costs and more sunlight (AZ, TX, FL) often have cheaper solar installations.
Q4: How long do solar panels last?
A4: Most panels come with 25-year warranties and last 30+ years with proper maintenance.
Q5: Will solar panels increase my home value?
A5: According to Zillow, homes with solar sell for ~4% more on average compared to similar non-solar homes.