Buying solar panels in 2024: The complete guide

1. You save on electric bills: The average homeowner saves between $20,000 and $90,000 on electric bills over the life of their solar panel system. If you electrify home appliances, like your heating & cooling system, car, or cooktop, you can often lower your other energy bills with solar. 

2. Your home value could increase: Studies show that having a solar panel system increases home value by an average of 4%.

3. You lower your carbon footprint: Unlike fossil fuels such as coal, oil, and natural gas, solar doesn't directly release carbon dioxide or other greenhouse gasses into the atmosphere (which contribute to climate change). 

1. It takes time to break even on your investment: On average, it takes EnergySage shoppers about eight years to save enough on their electric bills to cover the cost of their solar panel system. However, with some financing options, like $0-down loans, you can start saving on day one.

2. Solar panels don't work at night: They need sunlight to generate electricity, so they don't work in the dark! You can pair your solar panels with a battery backup system to store excess electricity produced during the day for use at night. A battery will add to the cost of the system, so you'll want to factor that into your total cost of ownership and how much savings you're hoping to achieve.

3. Your solar panels could (eventually) end up in a landfill: In the United States, solar panel recycling is still in its infancy, so today, most solar panels end up in landfills at the end of their lives. Some companies, like We Recycle Solar, are looking for ways to improve solar panel recycling in the future, but none of them have achieved widespread adoption yet. 

You might have heard or seen the terms monocrystalline or polycrystalline in your solar panel research. Monocrystalline solar panels have cells made of a single silicon crystal. They're typically black in color and more efficient. Polycrystalline solar panels have cells made of multiple silicon crystals melted together. They're generally blue in color and more affordable. 

Also referred to as its wattage or capacity, your solar panel's power output refers to the amount of electricity it generates under standard test conditions. The higher the power output, the more electricity your panel will produce. Solar panels generally range from 350 to 450 W in quotes provided through the EnergySage Marketplace. As of 2024, our most commonly quoted power output range is 400 to 410 W.

Efficiency measures your solar panel's ability to convert sunlight into usable electricity. The higher its efficiency, the more electricity your panel will produce. Today, solar panels quoted on EnergySage generally range from 19.7% to 21.6% efficiency. Some of the most popular brands on EnergySage have efficiency ratings above 22%. SunPower offers the most efficient solar panels from EnergySage installers at 22.8%. 

Like most electronics, solar panels perform best when they're kept cool. Your solar panel's temperature coefficient or performance measures how much its power output will decrease as the surrounding temperature increases. For every degree above 25° C (77° F), your panel's solar production will fall by its temperature coefficient.

If your panel's temperature coefficient is -0.26%/°C and the surrounding temperature increases one degree from 25° C (77° F) to 26° C (79° F), its electricity production will decrease by 0.26%. The lower the temperature coefficient, the better your solar panels perform on hot, sunny days. 

As with any significant investment, you'll want your solar panels to last. Most solar panels have a lifespan of about 25 to 30 years, but the best way to guarantee your panels will continue to perform well for a long time is to select a model with a great warranty. 

Generally, there are two critical components to a solar panel warranty. The product or materials warranty guarantees that the manufacturer will replace your panel if it fails due to manufacturing defects within a specified warranty term. The performance or power warranty guarantees that your panels will still produce a certain percentage of their original output by the end of the fixed warranty term. Many other factors indicate the strength of a solar panel warranty, including labor coverage, shipping overage, and bankability of the company (e.g., how likely they'll be around to fulfill your warranty). 

The best way to get a great deal on your solar panel system is to compare quotes based on cost, equipment, and installer reputation. Historically, many solar shoppers only received one solar quote from a door-to-door salesperson or a cold call. But how can you feel confident in your solar decision if you only see one quote?

The free EnergySage Marketplace makes this easy by gathering up to seven custom solar quotes for you from our network of pre-screened installers. On average, solar shoppers who receive quotes on EnergySage pay 20% less for their solar systems than those who don't.

Now that you have multiple quotes to compare, it's time to choose the best installer. EnergySage's mission is to help you choose with confidence. Our team of expert Energy Advisors can walk you through your quotes (even if you didn't get them through EnergySage) and answer all your questions so you can pick the system that meets your needs at the right price. Once you've selected an installer, you'll need to sign a contract. Thoroughly review it first for details on costs, incentives, equipment, cancellation terms, and clauses. 

You'll next need to schedule a site visit with your installer as a final check to ensure the solar panel system you're purchasing is suitable for your home. (Learn why most installers prefer a signed contract before completing a site visit.) During this step, an engineer (not a salesperson) will check your roof and electrical panel to decide if they need any updates before you go solar. An installer can conduct a site visit in person or virtually. Check out this article to understand how to prepare for a virtual site visit.

Your installer has determined your house is solar-ready and is prepared to proceed with your installation. Now you'll need to decide how to pay for your system. Generally, we recommend paying with cash for the best long-term savings or a loan if you want to start saving immediately.

• Upfront with cash: Paying for your solar system with cash is the best way to maximize your long-term savings: You won't owe anything in interest or be subject to origination, dealer, or closing costs (which can add up!). However, many homeowners lack the cash to purchase their solar panel systems upfront.

• Solar loan: Most people choose to finance their solar panel systems with a solar loan. You'll still qualify for incentives, and you could start saving on day one if your monthly loan payments are less than your previous electric bills. Your savings will be lower than if you pay with cash, but using a solar loan makes it much easier for most people to go solar.  

• Solar lease or PPA: With a solar lease or PPA, you don't own your system, so you don't qualify for some of the best solar incentives. With a solar lease, you pay a fixed monthly lease payment, whereas with a PPA, you agree to purchase the power generated by your system at a set price per kWh. Your savings will be the lowest with a lease or PPA. They can also make it difficult to sell your home if the new owner doesn't want to take over the payments.

You've done all the hard work on your end! Now it's time to watch it pay off with a brand new solar panel system. Before installation day, your solar company will begin submitting the paperwork required for installation, interconnection to the grid, and any available incentives. 

On the day of your installation, you can expect about 5-10 employees of your installation company to be onsite, ranging from certified electricians who do all of the electrical work to the solar panel installers who will be up on your roof putting the panels in place and attaching them to your roof. Depending on the size and scope of your installation, it will likely take about 1-3 days to complete. 

Following your installation, you'll need permission to operate (PTO) from your utility before your installer can turn on your system, which can take anywhere from a few weeks to a few months. As part of PTO, your utility company will likely send a representative to your house to examine your system and install or update your meter so they can track the solar energy you send to the grid. Once PTO is complete, you'll receive official documentation to turn your solar panel system on for electricity generation officially!

The federal investment tax credit (ITC) is today's best solar incentive. Unlike a tax deduction (which reduces your taxable income), the ITC allows you to apply 30% of your solar system's upfront cost as a credit toward your federal tax bill. If you've overpaid your taxes during the year, you can even receive the ITC as a refund, as long as it doesn't exceed your total tax liability. If it does exceed your tax liability, the remaining credit will roll over to the following year. 

When the sun's shining, your solar panel system will likely produce more electricity than you need. Luckily, many states have a solar policy called net metering in which you'll receive credits from your local utility company for the excess electricity you send to the grid. At night or on a rainy day when your panels aren't generating enough energy, you'll pull electricity from the grid, which will count against the credits you've banked over time. At the end of your billing cycle, you'll only be billed for your "net" energy consumption (meaning your electric bills could be $0)!

Many states have additional incentives that make it even easier to go solar. You might be eligible for a state tax credit that works similarly to the ITC but for your state taxes. You could even receive an up-front rebate for installing your solar panel system. If your state has a renewable portfolio standard (meaning it's required to procure or generate a certain percentage of electricity from renewable sources), you might be able to earn additional income for the electricity your solar panels generate by selling solar renewable energy certificates (SRECs). As a homeowner, you can earn one SREC for every megawatt-hour (MWh) – aka 1,000 kWh – of electricity your solar panel system generates.