Solar Panel Costs in Utah: Local Solar Installation Prices (2022)
Here’s a quick look at the estimated cost of solar in Utah:
- Average Cost Per Watt: $2.68
- Cost of Average System: $15,866*
- Cost of Energy Without Solar: $31,642
- Payback Period: 16 Years**
- Lifetime Savings of Going Solar: $10,202
*Average system size is calculated using data from the Energy Information Administration. This price is after tax credit.
**Payback period is calculated assuming the system is purchased in cash.
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Looking to go solar, but want to know more about the average cost of solar panels in Utah? In this article, we’ll go over solar panel pricing in the Beehive State and show you how to save money on your home’s installation.
The figures we use in this article are averages, but solar costs can change significantly based on your home’s configuration and your household energy needs.
To get an accurate, free estimate of what it would cost to put solar panels on your roof, you can get a quote below or to be connected to a certified installer near you.
How Much Do Solar Panels Cost in Utah?
The good news for residents of Utah is that the cost of solar panels in the state is on par with the national average. Based on market research and data from top solar brands, we’ve found the average cost of solar panels in Utah to be $2.68 per watt, while the national average stands at $2.66.
At $2.68 per watt, a typical 5-kilowatt (kW) system would cost $9,904 after the federal solar tax credit is applied. A price tag under $10,000 for a residential solar system is usually considered excellent. For pricing of solar power systems between the 5 kW to 10 kW (which are the most common system sizes for residential installations), take a look at the chart below.
|Size of Solar Panel System||Cost of Solar Panels in Utah||Cost After Federal Tax Credit|
While the numbers in the table are reliable, they are based on the average cost per watt and hence only indicate approximate system prices. The best way to get the correct pricing for your home is to contact nearby installers. We recommend getting several free quotes before selecting the best solar company for your project.
Consulting installers near you not only gets you a more accurate price range, but also several other important numbers such as your projected solar payback period, your net return on investment and more. These can prove to be key indicators of whether solar panels are worth it for your home.
What Determines the Price of Solar Panels in Utah?
Solar panels are neither produced by a single manufacturer nor installed by a single provider. So, naturally, it is impossible for solar systems to have uniform costs throughout the state. Let’s take a look at the factors that most affect the cost of solar panels in Utah:
Like any other technology, solar equipment is designed and built by different companies using varying types and qualities of components. Some manufacturers prefer to build extremely durable panels that last long and save in the long term, while others focus on making cheap solar panels that may not hold up but have an attractive sticker price.
Each manufacturer also offers a unique set of features — a sleeker look, built-in microinverters, app-based monitoring capabilities, long warranties and so on. The same variance applies to mounting structures, inverters, wiring, solar batteries and other components of the system.
Solar panel prices have dropped 64% since 2010. Even still, the majority of U.S. homeowners may not be able to afford a multi-thousand-dollar investment out of pocket. Most solar customers thus tend to look for options that don’t require large upfront payments. Here’s a quick overview of all available options:
A cash purchase is the most desirable option if you’re thinking long-term, but it’s the least convenient in the short term. Although you’ll need to cover a large amount of money upfront, paying in cash has the highest money-saving potential over the system’s lifespan, as there is no interest or fees to account for.
A solar loan increases the total cost of a system, owing to interest rates and/or processing charges. However, it does not require the buyer to spend a large amount at once, which makes solar financing options popular. A highlight of solar loans is that despite staggered payments, they still allow the user to claim the federal tax credit in the year their system goes into service.
Lease or Power Purchase Agreement
A solar lease is similar to a solar loan, except that the ownership of the system remains with the installer. As a result, the homeowner is not eligible to claim the solar tax credit and misses out on other incentives and benefits like added property value. Solar leases often also have longer tenures than loans.
With a solar lease or power purchase agreement (PPA), a solar company will install the panels on your home for free, and you will make a monthly payment to access the power they produce.
While zero upfront costs might be tempting, a lease or PPA provides the least monetary value in the long run and is not recommended unless it is the only feasible option.
A typical solar installation company purchases dozens of individual components from several different suppliers. It also employs a bunch of people to survey, design and install your system. As such, this level of complexity means not every installer is going to be charging the same price.
Additionally, the size and scale of a company will also matter. Pricing will be different between a national brand and a local entrepreneur. There is no general rule as to what is best — the cheapest company isn’t always best, and the same is true for the largest company.
As mentioned, we recommend getting solar quotes from multiple companies and comparing them on several parameters when trying to find the perfect match for your installation.
Utah Solar Incentives
When considering the cost of solar panels in Utah, it helps to take into account the financial incentives available to residents. Here’s an outline of the major solar incentives in Utah:
|Utah Solar Incentive||How it Affects the Cost of Solar Panels in Utah|
|Utah Renewable Energy Systems Tax Credit (RESTC)||The RESTC offers a state tax credit worth 25% of the residential solar installation costs, with a maximum of $800 for installations completed in 2022. The maximum value falls to $400 in 2023 and will not be available thereafter.|
|Net metering||Net metering allows users to send excess solar energy back to the local power grid in exchange for credits to use against future energy bills. This eliminates energy storage costs while also reducing monthly electric bills. Rocky Mountain Power has a net metering program in Utah.|
|Local solar incentives||A number of counties and utility companies may offer rebates and other incentives for solar panel installation. Don’t forget to check for any available incentives in your region before going solar.|
|Federal solar investment tax credit (ITC)||The ITC allows solar energy system owners to claim a credit equivalent to 26% of their solar system’s costs. The value of the tax incentive is set to reduce to 24% in 2023 and will be phased out for residential systems thereafter.|
FAQ: Cost of Solar Panels in Utah
Multiple studies have shown that having solar panels on a home increases its value, which makes sense considering the fact that solar panels can save thousands of dollars in power bill savings over decades.
A Zillow study showed that on average, solar panels increase property value in the U.S. by 4.1%. Other studies have shown similar property appreciation with solar panels.
Although solar panels succeed in eliminating a portion of your energy costs, the equipment itself is not free. However, residential solar panels have witnessed a whopping 64% reduction in prices since 2010. Additionally, the panels pay themselves off in a few years and save a significant amount over their lifetime, making them a highly profitable investment.
If you hear of a company offering “free solar panels,” it’s likely a marketing tactic to get you to sign a solar lease or power purchase agreement. However, the amount you pay for your lease (plus your monthly utility bill) may not be less than what you were paying each month before you installed your system.
The Utah Renewable Energy Systems Tax Credit (RESTC) is an incentive created by the Utah Office of Energy Development to promote clean energy technologies. Any residential or commercial entity that installs one of the eligible renewable energy systems can avail of the tax deduction.
The incentive covers solar photovoltaic (PV), wind, geothermal, hydro, biomass, and certain renewable thermal technologies. However, this credit is phasing out. As of 2022, residential customers can claim 25% of their system cost, or $800, whichever is lower. The value decreases to a maximum of $400 in 2023, and the program will end in 2024.
Commercial solar customers can claim a deduction of 10% of the solar project cost, or $50,000, whichever is lower.
When you consider the combined effect of the federal solar tax credit and the RESTC, the Utah solar panel costs drop notably.
Aniket Bhor is a solar engineer who has spent nearly a decade studying and working in the solar power sector in the European, Asian, and North American markets. He is a climate enthusiast and avid cyclist, and he also loves to lose himself in books and cooking.