Leonardo is an energy consultant with experience in many solar projects funded by the Inter-American Development Bank, in large commercial and industrial buildings. He specializes in feasibility analysis for solar power, which includes calculating the payback period and return on investment offered by solar panels.

two people talking to each other about the solar panels next to them

How the Trump Solar Panel Tariff Affects the Solar Industry

How the Trump Solar Panel Tariff Affects the Solar Industry


Written by qualified solar engineer Leonardo. Last updated:

Trump’s solar panel tariff was introduced in 2018, increasing the price of imported solar cells and solar panels by 30%. Since the import tariff is reduced by 5% each year, a 20% rate applies for 2020. However, the tariff does not increase the final price of solar systems by 20%, since it only affects panels and cells. On average, the solar installed cost increases by less than 10 cents per watt. Therefore, solar power remains among the best investments available for property owners.

For example, a 10-kilowatt solar system will normally cost around $30,000 with current US prices, before subtracting any rebates and incentives available. For a system of this size, the Trump tariff on solar panels will affect the final price by less than $1,000.

How Does the Trump Solar Panel Tariff Work?

According to the US Trade Representative, China was producing 60% of solar cells and 71% of solar panels globally by 2018. This was possible in great part thanks to government subsidies and low-interest financing for solar manufacturers. At the same time, solar panels manufactured in the U.S. were becoming less competitive against the low-cost imported panels.

To protect US-based solar companies and stimulate local production, the Trump administration imposed a 30% tariff on solar panels manufactured outside the US. The tariff was introduced in 2018, with a four-year duration and a gradual reduction of 5% per year. The following table summarizes how the tariff affects a 300-watt solar panel with a price of $100 during each of the four years:

YearSolar Panel Tariff (%)Tariff for a $100 Solar Panel (US$)

Since the tariff uses a percentage instead of a fixed dollar amount, it increases and decreases along with the solar panel price. For example, a 300W panel with a price of $110 would have a tariff of $22, even with the same wattage as the panel in the example above.

These numbers may seem small, but consider that home solar systems often use more than 20 panels. In this case, the tariffs on solar panels result in a cost increase of $400. Commercial, industrial and utility-scale solar projects are affected more, since they use thousands of panels. For instance, one megawatt of solar capacity requires around 3,000 panels. If each of them has a $20 tariff, the one-megawatt project becomes more expensive by $60,000.

As previously mentioned, the import tariff imposes a 20% fee on both solar panels and solar cells. This means manufacturers cannot avoid the tariff by importing solar cells and assembling them into panels inside the US. However, the tariff does not make full a solar power system more expensive by 20%, since the panels are just a fraction of the total cost. Keep this in mind when reading solar tariff news.

Does the Trump Solar Panel Tariff Affect the Federal Tax Credit?

A man accounting for his taxes

The US government offers a federal tax credit for solar power systems, which can be combined with local incentives. Federal solar tax credit information is very abundant online, but the most important facts you need to know are the following:

  • The incentive was 30% until 2019, and it has been reduced to 26% for 2020.
  • There will be another reduction tax credit reduction to 22% in 2021.
  • From 2022 onwards, there will only be a 10% incentive for businesses.

The federal tax credit applies for the full price of an installed solar power system, while the Trump tariff only affects solar panels and cells. In other words, the tax credit is much higher that the extra import tariff. You can also avoid the import tariff by using locally-produced solar panels.

Solar panels are still fairly expensive, but the federal tax credit makes them easier to afford. For example, a 6-kilowatt home solar system has a typical price of around $18,000. If the import tariff increases the cost by 8 cents per watt, you pay an extra $480. However, when you deduct 26% of $18,480, the federal tax credit is $4,805. The numbers may vary when you get offers from solar installers, but in this example the federal tax credit is 10 times larger than the Trump tariff.

Solar panels are worth the investment even with the Trump tariff. Paying 20% may seem like a lot when only solar panels are considered, but the price effect on a completed system is typically less than 3%. Solar panels are also getting more affordable each year, and a percentage-based tariff decreases along with panel costs.


  1. Office of the United States Trade Representative – Section 201 Cases: Imported Large Residential Washing Machines and Imported Solar Cells and Modules
  2. Solar Energy Industries Association – Solar Investment Tax Credit (ITC)

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Deciding Between Solar Roof Shingles or Solar Panels

Deciding Between Solar Roof Shingles or Solar Panels


Written by qualified solar engineer Leonardo. Last updated:

Installing solar panels is a proven way to generate your own electricity and save on power bills. However, solar roof shingles can be a viable option for new homes (or if you are planning a roof replacement). Unlike conventional panels, which are installed with racking on top of your roof, solar shingles have built-in solar cells.

On average, solar shingles are twice as expensive as panels. In the US, a solar panel system costs around $3 per watt of installed capacity, while the cost of solar roof shingles is between $5 and $7 per watt. However, consider that solar shingles also accomplish the function of a roof. While shingles are more expensive than panels by themselves, they save the cost of the roof beneath.

Consider that roof tiles have a lower efficiency than normal panels, which means you need a larger area for a given system capacity. To ensure you are getting the best deal, getting quotes from several solar roof shingle installers is recommended.

The Cost of Solar Roof Shingles

Close up of a Tesla solarglass roof

Just like with solar panel systems, the cost of solar power roof shingles varies depending on the brand and installer. For example, the cost of a Tesla solar roof is normally above $6 per watt, but there are manufacturers that offer solar tiles for less than $5 per watt. Solar roof costs are also affected by the project’s location. Since the technology is less widespread than normal panels, costs increase if there are no providers nearby.

Considering that the price of solar panel installation is around $3 per watt, you can expect to pay around $30,000 for a 10-kilowatt solar system. If you want to reach the same capacity with solar panel roof shingles, you can expect to pay between $50,000 and $65,000. Based on roof area, the installed cost of solar tiles ranges from $20 to $25 per square foot.

  • Since solar tiles have twice the cost of panels for a given capacity, their payback period is also twice as long. However, solar shingles can be financially viable if you were going to pay for a new roof installation anyway.
  • When choosing between solar shingles and panels, the appearance of each option also matters. If you prefer the look of solar shingles and are willing to assume the extra cost, they become an option even if you don’t plan a roof replacement.

In October 2019, Tesla revealed a redesigned version of its solar tile system called the solar glass roof. According to the company website, the estimated cost of a 10-kilowatt system is $33,950. While the price can increase depending on roof conditions and project location, this is much closer to the cost of traditional solar panels.

Do Solar Roofs Get the Federal Tax Credit Incentive?

The federal tax credit for solar panel systems is also available for solar shingle installations, making them less expensive to purchase. However, the benefit only applies for roof sections that use solar shingles. For example, if you plan to replace a 3,000-square-foot roof with 2,000 sq. ft. of solar shingles, the remaining 1,000 sq. ft. are not covered by the federal tax credit.

As of 2019, you can deduct 30% of your solar energy investment from federal taxes. However, this will decrease to 26% in 2020 and 22% in 2021. Only a 10% tax credit will remain from 2022 onwards, and it will only be available for solar energy systems in commercial buildings.

How Much Energy Do Solar Roofs Produce?

If you compare one solar tile with one solar panel, the electricity output of the panel is much higher. Solar tiles normally have a capacity below 60 watts, while many panels now have a power rating above 300 watts. To reach a certain capacity in kilowatts, the required amount of solar panels will be less compared to solar shingles.

For both solar panels and roof shingles, how much energy is produced depends on external factors as well.

  • Some locations are sunnier than others. Regardless of the type of solar energy system, the electricity production increases along with sunshine. For example, California is much sunnier than New York. If you use solar shingles of the same capacity in both states, the electricity output per shingle will be higher in California.
  • The orientation of solar tiles and panels is also important. In the northern hemisphere, south-facing roofs get more sunlight than north-facing roofs. If you only plan to use solar tiles in some areas, find out which sections of your roof get the most sunshine.
  • Shadows reduce the productivity of all solar energy systems, regardless of their type. When defining the layout of your solar installation, shaded areas should be avoided.

A solar shingle can be described as a smaller solar panel embedded into a roof tile. The design principles used to maximize the productivity of the panels apply for shingles as well.

When Are Solar Panels Recommended Instead of Solar Roofs?

A home with solar panels installed on the roof

If you have no plans to build a new home or to change your roof and you are not willing to pay the extra cost of solar shingles, you can still save money by using solar panels. For example, if you recently bought a new home with a normal roof, using solar shingles is like paying for your roof twice.

Compared with solar roof installations, the time it takes to install solar panels is shorter. Solar shingles involve a partial or complete roof replacement, which can take several days, or even weeks in a large property. On the other hand, panel installations are often completed in one day. With a quicker installation, you can start saving on power bills earlier.

Before proceeding with a solar installation, take your time to contact several providers, and get familiarized with the different types of solar panels available. For example, if you have limited roof area, a solar panel model will a high efficiency will maximize the electricity output.

Solar Panels and Solar Roof Shingles: Final Comparison

The following table provides a summarized comparison between solar shingles and conventional panels. Similar to many other home upgrades, each option has advantages and disadvantages.


Solar Panels

Solar Shingles

Typical cost of a 10-kW system


$50,000 – $65,000

Wattage per unit

Over 300 watts per panel

Below 60 watts per shingle

Installation method

Racking on top of your roof

Become part of your roof

Service life

Over 20 years

Over 20 years


Visible panels

Look similar to asphalt shingles

Recommended usage

Existing roof with no replacement plans

New constructions, roof replacements, homeowners who prefer the look of shingles and are willing to pay the extra cost

Solar roof tiles are a higher-cost alternative to solar panels, but they combine roof tiles and panels into a single element. In new constructions and roof replacements, solar tiles can help you save on materials and installation costs.

Solar shingles can be combined with battery systems just like normal panels, to store electricity for nighttime, rainy days, or blackouts. Battery systems can also be used to participate in load management programs where utility companies offer them. The federal tax credit incentive also covers batteries if they get at least 75% of their charge from a solar energy system – this applies for both solar panels and solar shingles.

The cost of solar tiles can be expected to decrease over time as solar panels became more affordable. The new solar glass roof by Tesla is a step in this direction, bringing the cost of shingles closer to that of conventional panels.


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Two solar installers installing a large set of solar panels to the roof of a house

Why are Solar Panels so Expensive?

Why are Solar Panels so Expensive?


Written by qualified solar engineer Leonardo. Last updated:

Solar panels are expensive because they use large amounts of high-purity silicon, and they require qualified installers. They must also be complemented with inverters and electrical protections to provide a reliable power supply. However, the savings achieved by solar panels during their service life are normally much higher than their upfront cost.

Solar power costs are determined by several factors, and the project budget can vary from home to home. The most efficient solar panels tend to be the most expensive, since they are the most difficult to produce. Also consider that the number of solar panels needed increases for larger households, driving up the cost of the project.

Comparing the Costs and Benefits of Solar Panels

Solar panels may seem more expensive than conventional diesel generators when you only compare their upfront cost. However, solar panels operate with sunlight, which is a free energy source. They also have much simpler maintenance requirements than other power generation systems. On the other hand, a diesel genset depends on fuel deliveries to stay operational. Maintenance is also more demanding, since the generator is exposed to mechanical wear and combustion at high temperature.

In a few words, solar panels are more expensive than diesel generators if you only compare their upfront cost. However, when total ownership costs are considered for the entire service life of equipment, the balance tilts in favor of solar power systems. Since sunlight is free and maintenance needs are minimal, solar panels can achieve some of the lowest costs per kilowatt-hour produced.

The price of installing the solar panels determines in great part how they will perform financially. Getting quotes from several solar companies is strongly recommended to make sure you find the best deal available. You should also ask for a detailed breakdown of what the solar offer includes to ensure there are no extra costs like permits and taxes.

Installing Solar Panels as an Investment Decision

For many homeowners, going solar can be as lucrative as investing in a small business. While solar panels are normally installed to reduce power bills, they bring many other benefits. Keep in mind you need reliable information to decide if it is worth installing solar panels. The recommended first step is contacting a qualified solar provider to get a professional assessment of your property. This will give you accurate data on solar system prices and how much you can expect to save.

Solar panel installer fitting a set of solar panels on the roof of a home

After installing solar panels, the money you save on electricity bills is strongly determined by local conditions:

  • Solar panels are more productive in sunny locations. There is more solar radiation hitting their surface, which means they can produce more electricity.
  • Solar energy is more valuable in places with expensive electricity. If two solar panel systems in different cities have the same energy output, savings will be greater in the city with the highest kWh prices.

A lesser-known benefit of solar panels is that they increase property value. A building that is capable of producing its own electricity is worth more than an identical building that depends 100% on the power grid. In addition, many states give you a tax exemption for any increase in home value that is due to a solar panel system. In other words, your home is worth more and it has smaller power bills, but your property taxes stay the same!

Depending on local regulations, it may be possible to make money from your solar panels. Consider that panels are only productive during the day, and most of their energy output occurs in the hours around noon. On the other hand, homes consume energy during the day and night. However, if the local utility company offers net metering, you can become a small-scale electricity supplier.

  • With net metering, the local power company purchases any electricity produced by your solar panels that is not used at home.
  • On the next power bill, the balance in your favor is subtracted from the electricity consumed from the grid.
  • Depending on how large your solar panel system is, it may be possible to bring the power bill down to zero, or even accumulate a balance in your favor.
  • Some power companies carry over your balance to the next power bill, while others actually pay you in cash.

If solar panels will pay back what you spent on them within a reasonable timeframe, they can be considered a solid investment. Solar panel manufacturers normally offer a 10-year warranty against factory defects, and a 25-year warranty for energy production above 80% of the rated value. However, the payback period can be less than 5 years under favorable conditions.

Using high-quality products is important to get the best results with solar power, but also make sure you check all the solar financial information available. Ideally, a solar panel system should be properly installed and covered by warranties, but it should also offer an attractive return for every dollar spent.

How Solar Panels Can Pay for Themselves

For homeowners with access to low-interest loans, it may be possible to go solar with zero net cost. The solar panel installation can be paid with the bank’s money, and then you can use power bill savings to cover the loan. If the annual savings are higher than the loan payments, your solar power system can purchase itself.

Couple checking their solar energy bills together

Consider there is also a 30% federal tax credit for solar power systems in the US. This means you can cover part of the project cost with money that would have otherwise been paid in federal taxes. Depending on where you live, there may be additional incentives such as state tax credits, solar power rebates, or renewable energy credits.

Solar panel systems seem expensive if you only focus on their sales price. However, their operation and maintenance costs are very low and they have a long service life. The upfront cost of solar panels is normally recovered multiple times in the form of power bill savings.

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solar panel out in the field facing towards the sun

What Direction Should Solar Panels Face?

What Direction Should Solar Panels Face?


Written by qualified solar engineer Leonardo. Last updated:

If you live in the USA or any other country in the Northern Hemisphere, the best direction to face solar panels is south. Since most sunlight comes from the south, this will make your panels more productive. However, if the local power company charges higher prices in the afternoon, your panels should face west to maximize the dollar savings.

The electricity output of solar panels is directly related to how much sunlight they receive. Therefore, you should install them on the sunniest part of your rooftop. Also consider that solar panels are not productive when in shaded areas, and they represent a wasted investment. You can find out more about this by reading our article on solar panels in the shade.

If you are charged constant kilowatt-hour prices, your goal should be maximizing the electricity production of solar panels. However, if you are charged variable kWh prices throughout the day, solar panels should maximize production when the highest prices are being applied. This will increase the savings on your power bill.

Why Do Solar Panels Produce More Energy When Facing South?

To maximize the return on investment, the first step is knowing where to install the solar panels. Since the Earth is a sphere, sunlight reaches each geographic location with a different angle. If you track the sun’s position in the sky for an entire year in the USA, you will notice it is mostly towards the south. As a result, solar panels facing south produce the most electricity.

Consider reading about how a solar panel works before moving forward. Different results can be expected based on its orientation:

  • Since the sun rises in the east, solar panels facing in that direction are more productive in the morning.
  • On the other hand, west-facing panels are more productive in the afternoon, since the sun sets in that direction.
  • Installing panels that face north is not recommended, since it results in the lowest electricity output.

As you move farther to the north, the sun has a lower position in the sky and solar panels must be tilted more. In locations that are not far to the north, such as Florida or Texas, solar panels do not need a drastic tilt. However, if you must use them in Alaska, they must be tilted almost vertically to collect as much sunlight as possible. Qualified solar installers can determine the optimal tilt angle based on your geographic location. We can help you when it comes to choosing a solar installer.

A set of solar panels facing the direction of the sun

Make sure you get an inspection of your property to find the best areas for a solar energy system. Consider that the size of a panel does not affect the optimal orientation: the recommendations above apply for both 60-cell and 72-cell panels. You can read our article about the importance of the size of a solar panel for more information.

The efficiency of solar panels is not affected by their orientation either. The electricity output varies because the amount of incident sunlight also varies, but the conversion from sunlight to electricity is not affected. If you’d like to know more, take a look at what we’ve written about solar efficiency.

How Electricity Tariffs Affect the Optimal Solar Panel Orientation

Your panel can have different monetary values, so it’s important to know about the energy produced by a solar panel. If you are always charged the same kilowatt-hour price, your goal should be getting maximum production from solar panels.

However, many electric companies apply time-of-use (TOU) tariffs, which change throughout the day. The highest kWh prices are normally billed in the afternoon and evening, since that is when the grid faces maximum consumption. There are many factors that increase operating costs, and this leads to higher tariffs:

  • Electric companies must bring more power plants online to meet the peak in consumption, including the plants with high generation costs.
  • Since power lines and transformers are carrying a high current, they waste more energy as heat emissions.
  • Electrical faults are more likely when the grid is burdened, creating a higher risk of blackouts.

Many power companies apply higher electricity prices at times of peak demand to compensate for their higher operating cost. The high kilowatt-hour price also disincentives consumption in homes and businesses, helping unburden on the grid.

As previously mentioned, solar panels become more productive in the afternoon if they face west. If you are charged a TOU electricity tariff, you can take advantage of this. A solar power system facing south will produce more kilowatt-hours than an identical system facing west. However, if the kilowatt-hour price increases sharply in the afternoon, your dollar savings will most likely increase.

Solar Panel Orientation Tips for Roof and Ground Systems

When finding the optimal orientation for solar panels, a ground installation offers more flexibility than a roof installation.

With a rooftop solar system, you are limited to the orientations and slopes of your existing roof sections. If an optimal solar panel placement is not possible, you may need to purchase additional panels to increase generation. On the other hand, with a ground solar system, you can adjust the orientation and tilt angle of panels for maximum productivity.

A set of solar panels placed on a roof facing towards the sun

While ground solar systems offer more flexibility for positioning, they also have their limitations. In the first place, you must have a property with enough ground space for solar panels, while a rooftop installation does not need extra space. Also, since a ground solar system has a lower elevation, finding a spot without shadows can be more challenging. This applies especially with products such as decorative outdoor solar string lights which solar panel is installed on ground, easily exposed to shading. If you need more information on how all of this works, feel free to take a look at our article about solar installation.

Since each property is unique, the best recommendation is getting a professional inspection and a customized solar panel system design. Getting quotes from multiple solar companies is also recommended, since you can compare several options and find the best deal.


  1. Solar Panel Orientation – University of Calgary

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couple checking their electricity bills

How Much Money Do Solar Panels Save You on Electricity Bills?

How Much Money Do Solar Panels Save You on Electricity Bills?


Written by qualified solar engineer Leonardo. Last updated:

On average, solar panels will save you over $1,100 per year on your electricity bills. This is assuming a system size of 6 kilowatts, which is common in the US. The estimate also considers the average sunshine available in the country, and the average electricity price of 13.34 cents per kilowatt-hour reported by the Energy Information Administration.

The US is a large country, however, where sunshine and electric tariffs change a lot from place to place. For this reason, average performance values can be misleading. Solar panels offer increased savings in places with abundant sunshine or expensive electricity. California has both conditions, for example, and the annual savings from a 6-kW solar system can reach up to $2,000.

Solar panels have become popular thanks to their simplicity and excellent return on investment. When you install a home solar system, the long-term savings can be up to 3 times higher than the upfront cost. Also consider that electricity prices tend to increase each year, making solar energy more valuable over time.

How Local Sunshine Affects Solar Panel Savings

The savings achieved by solar panels are directly related to the sunshine they receive. To visualize the concept, assume you have two identical solar systems in different states, where one gets 50% more sunshine. Since the panels simply convert sunlight into electricity, you can expect them to produce around 50% more kilowatt-hours as well.

  • The local sunshine cannot be changed, but you can make solar panels more productive with smart placement.
  • Ideally, they should be installed in an area that does not get shadows from surrounding objects or buildings.
  • Avoiding shadows can be tricky: their position changes throughout the day depending on the sun’s position in the sky.

In the US and other Northern Hemisphere countries, most sunshine comes from the southern portion of the sky. To take advantage of this and save more energy, solar panels should be tilted slightly south. If you work with qualified solar installers, they can arrange your panels so they avoid shadows, while having an optimal orientation to increase the sunlight received.

solar installers arranging where to place the solar panels

Solar companies use a metric called the “specific yield” to describe solar panel productivity under the sunlight conditions of a given site. The specific yield provides the annual output in kilowatt-hours, for every kilowatt of installed capacity. Since the metric is expressed per kilowatt, it applies for solar power systems of any size.

For example, if the specific yield is 1,600 kWh per kW with the local sunshine, a 10-kW solar system will deliver 16,000 kWh per year.

  • A specific yield of 1,400 kWh/kW can be considered average for the US.
  • A value of 1,200 kWh/kW would be considered below-average.
  • On the other hand, a value of 1,800 kWh/kW indicates above-average solar productivity.

The electricity produced by a single solar panel can be estimated if you know the specific yield for the project site of interest. You just have to multiply the panel wattage by the kWh/kW value, and then divide the result by 1,000. For example, if you are considering a 330-watt solar panel model and the local sunshine allows a specific yield of 1,500 kWh/kW, each panel produces around 495 kWh per year.

How Electricity Prices Affect Solar Panel Savings

There is a common misconception that solar panels are worth the investment only in sunny places, but this is not the case. If local electricity prices are high, even a modest electricity output can cut your power bill significantly. Generating 2,000 kWh with a tariff of 12 cents achieves the same result as generating 1,200 kWh with a tariff of 20 cents. In both cases, $240 are subtracted from your power bills.

Of course, the highest possible savings are achieved when you have both abundant sunshine and high kilowatt-hour prices. The following table estimates the annual savings for a 6-kW solar panel system, considering various electricity prices and solar productivity values (specific yield):

Annual Savings ($) with Various Specific Yield Values (kWh per kW Installed)

Electric Tariff (Cents/kWh)

1,200 kWh

1,400 kWh

1,600 kWh

1,800 kWh

2,000 kWh































This table demonstrates how both sunshine and electricity prices are important when estimating the savings achieved by solar panels. Even sites with below-average sunshine can be viable for solar panels if local electricity prices are high.

The US Northeast provides a clear example of how solar panels can save money even with modest sunshine. These states are not particularly sunny, but they have some of the highest electricity prices in the country. Even if solar panels are less productive compared with sunnier states, their electricity output has a high monetary value.

If your state has a Solar Renewable Energy Credit (SREC) program, this is great news. In addition to saving on electricity bills, you will earn one SREC for every 1,000 kilowatt-hours generated by your solar panels.

  • A 6-kW solar panel system will normally accumulate between 7 and 10 SRECs per year.
  • SRECs have a variable sales price, but they represent extra income beyond your power bill savings.

The best recommendation is getting in touch with SREC broker to sell yours, since the required paperwork can be complex. In states that have SREC markets, they typically sell for over $150 each. This means that 7 SRECs will leave over $1,000 in your pocket!

Comparing the Upfront Cost and Long-Term Savings of Solar Panels

While it is true that solar panels are expensive, the savings they achieve in the long run outweigh their upfront cost. Solar panels are durable and easy to service, and they come with solid warranties if you purchase them from a trusted supplier.

In the US, the cost of installing solar panels on a house is around $3 per watt of capacity. Assuming a capacity of 6 kW, which is quite common, the expected budget is around $18,000. However, the 30% federal tax credit cuts the net price to around $12,600, and incentives from local utilities and authorities can make solar panels even less expensive.

Assuming favorable conditions, a 6-kW solar panel system can save over $30,000 during its service life. In other words, the long-term benefit is 2 to 3 times higher than the upfront cost. Also consider that electricity tariffs increase over time, typically between 2% and 4% annually. On the other hand, solar panels have minimal maintenance costs after the initial investment.

With high-quality equipment and a professional installation, the lifespan of your home’s solar panels will likely be over 25 years. In other words, you get a reliable electricity source that will not become more expensive over time, unlike the local utility service.

How Smart Financial Decisions Can Help You Purchase Solar Panels

If solar panels pay for themselves, they can be installed at zero net cost. For example, if you borrow $12,600 for a 6-kW solar system, with an interest rate of 4% and a repayment period of 15 years, the annual debt payment is slightly over $1,100. Typically, the annual savings will be higher than this, and no money will come out of your pocket.

Depending on local regulations, it may even be possible to make money from solar panels.

  • Utility companies in the US normally offer net metering, which consists on giving credit for any surplus solar generation you inject into the grid.
  • If the power generation from your solar panels exceeds your monthly consumption, there is a balance in your favor.
  • Most electric companies carry the balance over to the next month until you consume it. However, in some cases you may be offered cash payments for surplus electricity, which essentially turns your home into a small-scale power plant.

Another financial benefit of solar panels is increasing the value of your home. Property values depend on several factors, but an average home with solar panels is around $20,000 more valuable than an identical home without them. Also, there are many states that offer a property tax exemption for clean energy systems: you will not pay higher property taxes if the increase in home value is due to a solar panel installation.

When you have more solar financial information at your disposal, you can make better purchasing decisions. Using high-quality solar equipment and working with qualified installers is important, but you also need make sure you’re analyzing all of your purchasing options.

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An image showing the difference between a monocrystalline and polycrystalline solar cell

What Are the Differences Between Monocrystalline and Polycrystalline Solar Panels?

What Are the Differences Between Monocrystalline and Polycrystalline Solar Panels?


Written by qualified solar engineer Leonardo. Last updated:

The main differences between monocrystalline and polycrystalline solar panels are their efficiency, color, shape, and material composition. Monocrystalline panels have solar cells made from a single silicon crystal, characterized by their black color and higher efficiency. Polycrystalline panels have cells made from multiple silicon crystals, with a blue color and a slightly lower efficiency.

Thin film solar panels are a less common type. They have a lower price than the two crystalline types, but this is offset by a much lower efficiency. This article will focus on monocrystalline and polycrystalline solar panels.

Before installing a solar power system for your home or business, you must decide which type of solar panel will be used. Polycrystalline panels are the most common, followed by monocrystalline panels. Both types use solar cells made from silicon, but their microscopic structure changes.

Do Monocrystalline and Polycrystalline Solar Panels Have the Same Quality?

Monocrystalline solar panels have a higher efficiency, but this does not mean that polycrystalline panels have a lower quality. The efficiency is determined by the material properties of solar cells, and should not be viewed as an indicator of product quality. If your solar panels are from the top global brands, both monocrystalline and polycrystalline panels are subject to stringent quality standards.

Comparing the two types of solar panels is similar to comparing a sedan with an SUV. High-quality cars of both types are available, but a compact car will have a better gas mileage thanks to its lower weight.

Since high quality is available with both types of solar panels, you can expect an excellent return on investment regardless of the type chosen. The best recommendation is purchasing panels in the Tier 1 list from Bloomberg New Energy Finance: they offer high quality, and they are supplied by companies with a solid financial condition. Having a good product is important, but you should also ensure the manufacturer will be around in the future, in case of a warranty claim. The Tier 1 list includes both monocrystalline and polycrystalline solar panels.

Choosing Between Monocrystalline and Polycrystalline Solar Panels

As mentioned above, quality is not an issue when comparing monocrystalline and polycrystalline panels. Assuming you have an available space that is not covered by shadows, both types will work well. However, monocrystalline solar panels become the best option under the following conditions:

  • You have limited space for solar panels.
  • Your priority is generating as much electricity as possible.

When space is limited, you cannot make your solar system larger to produce more electricity. The maximum production with the available space is only obtained with the more efficient monocrystalline panels.

Assuming space is not a limitation, you can use any type of solar panel. The best recommendation is getting quotes from multiple solar companies, to find the one that offers the highest return on investment and the quickest payback period.

If you plan to use all your available roof area for solar panels, you will probably have plenty of surplus generation around noon. All the electricity you don’t consume is sent to the power grid, and this may be viable or not depending on how the utility company gives credit. Assuming you fill the roof with solar panels, their surplus production will be higher if they are monocrystalline.

  • Some power companies purchase surplus generation from your solar system at the retail price of electricity.
  • However, other power companies only give partial credit for every kilowatt-hour sent to the grid by your solar panels.

If the local power company gives full credit for surplus generation, it makes sense to fill your rooftop with monocrystalline panels and maximize production. On the other hand, if you only get partial credit, you can use polycrystalline panels and take advantage of their lower price.

At the end of the month, the balance in your favor is subtracted from the power bill. By producing enough surplus electricity, it may be possible to reduce the power bill to zero. If the balance in your favor exceeds your power bill, the difference is normally carried to the next month. Some electric companies may also even pay you in cash, but this is less common.

Physical Differences Between Monocrystalline and Polycrystalline Solar Panels

Monocrystalline and polycrystalline solar panels differ in both appearance and efficiency. Their manufacturing processes have key differences, which are reflected in the final product.

The materials of a solar panel are the same in both cases: solar cells are made mostly from silicon, with small amounts of other elements. However, the structure of the silicon crystals changes depending on the type of solar panel. Monocrystalline panels have solar cells that are composed of a single silicon crystal, as implied by their name. On the other hand, polycrystalline panels have solar cells that are composed of multiple silicon crystals fused together.

  • Monocrystalline panels are more expensive because their manufacturing process is more difficult. Molten silicon must be grown carefully into large crystals called ingots, which are then cut into individual solar cells.
  • Polycrystalline panels have a less demanding manufacturing process, since there is no need to grow single crystals from molten silicon. Instead, silicon solidifies into a multi-crystalline block, which is then cut into individual solar cells.

side by side monocrystalline and polycrystalline solar panels

Electric current travels more easily through monocrystalline cells, since they have an ordered crystal structure. On the other hand, polycrystalline cells have divisions in their crystal structure, which cause a slight disruption of electric current. This is exactly why polycrystalline panels have a lower efficiency. However, they are the most popular type because they are easier to produce and more affordable.

Monocrystalline and polycrystalline solar panels also differ in how their solar cells are cut, and this affects the appearance of the finished product. As mentioned above, monocrystalline solar cells are cut from single-crystal silicon ingots. Due to how the ingot is cut, these solar cells have an octagonal shape. On the other hand, the silicon wafers used for polycrystalline cells are made with square molds, and the solar cells have a square shape with straight edges. Polycrystalline solar panels have a lower cost for two main reasons:

  • Their manufacturing process is simpler.
  • Less silicon is wasted while cutting the wafers into solar cells.

The weight of the solar panel does not change much between the monocrystalline and polycrystalline types. Consider that both panel types use the same material, and what changes is the crystalline structure of silicon.

  • The 60-cell panels that are commonly used in home solar systems weigh between 42 and 44 pounds each.
  • On the other hand, the larger 72-cell panels weigh between 51 and 53 pounds.
  • Therefore, the structural requirements for roofs are the same for both types of solar panels.

The color in solar panels is determined by how sunlight interacts with the solar cell materials. Since polycrystalline panels have solar cells made from multiple silicon crystals, sunlight spreads in multiple directions, causing a blue color and a shiny appearance. On the other hand, monocrystalline solar panels appear black because they absorb sunlight more effectively.

Manufacturer warranties and the expected service life are the same for both solar panel types. Normally, you can expect a 10-year or 12-year warranty against manufacturing defects. There is also a 25-year warranty against the loss of energy production. Solar panel manufacturers guarantee that energy production will not drop below 80% over a 25-year period.

Advantages and Disadvantages of Each Type of Solar Panel

When comparing monocrystalline and polycrystalline panels, it is not possible to say that one type is better than the other. The following table summarizes the advantages and disadvantages of each solar panel type:

Solar Panel Type




-Highest efficiency available

-More electricity generation per square foot

-The solar power system can be more compact

-Higher price

-Their manufacturing process produces more waste


-Lower price than monocrystalline modules

-Their manufacturing process produces less waste

-Technical support is widely available, since this is the most common type of solar panel

-Lower efficiency than monocrystalline modules

-Lower electricity generation per square foot

-For a given system capacity, they use more space than monocrystalline modules

In general, monocrystalline solar panels are a more expensive option to maximize electricity production with the space available. On the other hand, polycrystalline panels offer a more affordable option when space is not a limitation.

Comparing Monocrystalline and Polycrystalline Panels: A Simple Example

If you ask for a specific solar system capacity, such as 10 kilowatts, polycrystalline panels will tend to use more space. Since these panels have lower efficiency, they need to cover more space than monocrystalline panels. However, keep in mind that polycrystalline panels also have a lower cost.

As an example, assume you are comparing the two following solar panel options for a 10-kilowatt installation:

  • 275-watt polycrystalline panels, with a retail price of $250 each
  • 305-watt monocrystalline panels, with a retail price of $340 each
  • Both options have 60 cells, and they have the standard solar panel size of 65” x 39”.

You need 37 of the polycrystalline panels to reach 10 kW of capacity, but you only need 33 of the monocrystalline panels. In other words, you need four additional panels if they are polycrystalline, and the solar system will cover 12 percent more area.

Each solar panel covers around 17.6 square feet. You will cover around 652 square feet with the polycrystalline panels, and around 581 square feet with the monocrystalline panels. However, this is not an issue if you have abundant space. On the other hand, if you only have 600 square feet available, you can only reach 10 kW with the monocrystalline panels.

With the data in this example, the total price of the 37 polycrystalline panels is $9,250. On the other hand, the 33 monocrystalline panels cost $11,220. In this case, one monocrystalline panel is 36% more expensive than one polycrystalline panel. However, reaching 10 kilowatts is only 21% more expensive with monocrystalline modules, since you need less of them.

Keep in mind this is just an example, and solar panel prices vary depending on the model, manufacturer, and project location. In the US you can expect to pay less than $1 per watt if the panels are polycrystalline, and above $1 per watt if they are monocrystalline. Lower prices are possible in large-scale solar systems, such as those in commercial and industrial buildings.

In home solar systems, the cost of solar panels is only around one-third of the total project cost. Consider that panels also need racking for support, as well as inverters, which convert their electricity output into the AC power used by home appliances. A solar power system also requires electrical protection devices, which protect your investment from short circuits and other electrical faults. These costs are similar for monocrystalline and polycrystalline panels.


  1. Photovoltaics -Department of Energy
  2. Photovoltaics – SEIA

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The Different Types of Solar Panels

What Are the Different Types of Solar Panels?


Written by qualified solar engineer Leonardo. Last updated:

Most solar panels used in homes and businesses can be classified into three types: polycrystalline, monocrystalline, or thin film. There are many ways to manufacture solar panels, and this determines their final appearance.

The different types of solar panels are easily identified based on their appearance, and each type has advantages and disadvantages. Silicon is the most common material used for solar panels, and it is used for both monocrystalline and polycrystalline cells. There are more materials available to produce thin film solar panels, but many are manufactured from silicon as well.

In terms of physical appearance, the main difference between monocrystalline and polycrystalline solar panels is the color and shape of the solar cell. While monocrystalline panels have black cells with rounded or notched corners, the polycrystalline ones have blue cells with square corners.

a monocrystalline solar panel and polycrystalline solar panel side by side

Monocrystalline Solar Panels

Mono stands for single, which indicates that monocrystalline solar cells are produced from a single crystal of silicon. During their manufacturing process, silicon crystals are grown into large ingots which are then cut into individual solar cells. These cells are then assembled into solar panels.

Thanks to their uniform crystal structure, monocrystalline solar panels have the highest efficiency among the types commercially available, which is above 20%. Monocrystalline panels are also characterized by their color, which is black or a very deep blue.

Compared with other solar panel types, monocrystalline panels are the most efficient option but also the most expensive. They are normally recommended when there is little space available, since their high efficiency maximizes the amount of electricity obtained. Monocrystalline panels were the first type to be invented, and as a result they are the most developed.

Polycrystalline Solar Panels

Also known as multicrystalline solar panels, these are the most common type. As their name suggests, polycrystalline cells consist of several small crystals of silicon in an irregular arrangement. The crystal fragments produce when monocrystalline cells are cut can be recycled to produce polycrystalline cells.

These panels are manufactured by melting multiple silicon fragments and pouring them into a mold, instead of using a single crystal. This process has a lower cost, but it results in a slightly lower efficiency of 15% to 20%. As a result, a larger area must be covered with polycrystalline panels to convert a given amount of sunlight into electricity. However, thanks to their lower price per watt of capacity, polycrystalline panels command the largest market share.

Polycrystalline panels can be considered the intermediate option in terms of cost and efficiency. They are less expensive than monocrystalline panels, while offering a higher efficiency than the thin film. These panels are recommended for most projects, since they offer decent efficiency for a reasonable cost.

Thin Film Solar Panels

As their name implies, this type of solar panels does not use silicon cells. Instead, the semiconductor material is simply applied as a thin layer on a substrate. This manufacturing process is very cheap, but it results in a much lower efficiency compared with monocrystalline and polycrystalline panels. This doesn’t mean they aren’t useful.

Most thin film panels only have an efficiency slightly above 10%. The most efficient models reach an efficiency close to 15%, which is comparable to the lower end of efficiency for polycrystalline panels. Unlike the other solar panel types, these can be manufactured from materials other than silicon, including cadmium telluride (CdTe) and copper indium gallium selenide (CIGS).

Many portable solar panels are of the thin film type to achieve a lower weight. The thin film manufacturing method can also be used to produce flexible solar panels or roll up solar panels. Thin film panels are also common in mobile applications where low weight is an advantage, such as RV solar kits.

How to Categorize the Different Types of Solar Panels

Once you know the appearance of each type of solar panel, telling them apart is very simple. You must simply observe the physical features and color of the panel:

  • If the solar panels have a uniform surface that is not divided into individual cells, they are thin film panels, regardless of the color.
  • If the solar panels have blue cells with straight edges, they are polycrystalline. As mentioned above, this is the most common type.
  • If the panels have black or dark blue cells with rounded edges or an octagonal shape, they are monocrystalline.

In spite of their differences, the three solar panel types are based on the same physical principle. When sunlight reaches their surface, photons (light particles) cause the movement of electrons, producing an electric current. In fact, this happens when solar panels are exposed to any source of light, but sunlight happens to be abundant and free.

Monocrystalline and polycrystalline panels can also be described by the number of solar cells they have. 60-cell and 72-cell panels are the most common, and 96-cell panels are also available. Some solar panels have their cells cut in half with laser, which provides a slight improvement in service life and efficiency.

The following table summarizes the advantages and disadvantages of the three main types of solar panels. The best choice depends on the application, and neither of the types can be considered better than the rest:

Solar Panel Type




Good efficiency. Intermediate price.

Less efficient than monocrystalline panels.


Highest efficiency.

Highest price.

Thin film

Lowest price. Lightweight.

Lowest efficiency.

The appearance of solar panels is a subjective factor, but it can also influence the purchasing decision. Assuming a client has the budget and site conditions for any type, the solar panel choice may be based on how it looks. For example, while some building owners may prefer the uniform surface of thin film panels, others may prefer the conventional blue color of polycrystalline panels.

Another important factor that clients must consider is the life and quality of the solar panel type. Monocrystalline panels are more expensive because of their efficiency. Oftentimes, higher efficiency leads to a longer life and faster charging times. They also power almost four times the electricity of thin film solar panels, and they’re much more space-efficient. If a consumer was looking to buy panels for a fast-paced environment requiring consistently large amounts of electricity, the consideration of monocrystalline panels would be wise.

With that same logic, thin film panels are ideal if you’re looking at carbon offset. They’re also very good when you have a large space that needs covering (without the need for the highest-efficiency) because of their ability to easily cover massive spaces and rooftops.

Other Types and Styles of Solar Panels

The three solar panel types described above are the most common, but other options have been developed for specific applications. This section will describe other ways to harness sunlight.

Thermal Solar Panels

Thermal solar panels are different from the other types, since they are designed to heat water instead of producing electricity. Instead of having solar cells, these panels have tubes that are designed to circulate a combination of water and antifreeze. The tubes are painted black or covered with a dark surface to maximize the amount of sunlight absorbed.

Bifacial Solar Panels

Bifacial solar panels are characterized by their ability to gather sunlight from both sides, by exposing both the front and the backside of solar cells. This increases electricity generation: all the sunlight reflected from the surface below the panels reaches the solar cells as well. Bifacial panels can be monocrystalline or polycrystalline, and they are available in framed and frameless versions.

Transparent Solar Panels

Transparent solar panels are still an emerging concept. Since they are transparent, a large portion of the sunlight received is allowed through. While this reduces efficiency, it also increases the possible applications of transparent solar panels. They can be used as windows in homes or vehicles, and as covers for the screens of mobile devices, among other applications. The more panels used, the higher the efficiency will be.


Heliostats are not solar panels strictly speaking, but they are used for large-scale power generation with sunlight. Heliostats are mirrors that track the sun, reflecting light and focusing it on a specific target. Arrays of heliostats can be used to gather sunlight from a large area, focusing it to create an intense heating effect. The concentrated heat is enough to drive a steam turbine and generator. This concept is called concentrating solar power, or CSP.

Concentrator Photovoltaics (CPV)

Concentrator Photovoltaics is an emerging technology that uses lenses or mirrors to focus sunlight into a highly efficient solar panel. CPV technology achieves a higher efficiency than even monocrystalline panels, but the potential applications are limited by a high cost. CPV systems are often combined with solar trackers and cooling systems to increase efficiency further, but this also makes maintenance more complex – adding to the overall cost. Maintenance costs add up, and this is an important factor to consider when purchasing.


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How Much Energy Does a Solar Panel Produce?

How Much Energy Does a Solar Panel Produce?


Written by qualified solar engineer Leonardo. Last updated:

Each solar panel can be expected to produce between 400 and 600 kilowatt-hours per year. The exact electricity production depends on the panel specifications and the amount of sunshine received. Smart design decisions can also improve the productivity of a solar power system.

Assuming that sunshine does not change, there are two main ways to increase the amount of energy a solar panel produces:

  • Making the panel larger, to capture more sunlight.
  • Achieving a higher efficiency with an improved solar panel design.

Solar panel manufacturers prefer to work with standard sizes, since this simplifies fabrication. For this reason, you will find that most panels have either 60 or 72 solar cells. Current research focuses on improving cell efficiency to increase energy production with the same panel sizes.

How much energy a solar panel produces depends on several factors. Solar panel efficiency and size are important, since they determine how much sunlight is captured and converted into electricity. Solar productivity also depends on the local climate, since more sunshine translates into a higher energy output. Finally, the panel orientation affects the amount of sunlight hitting its surface. The best solar companies make sure that no panels are covered by shadows, while finding the orientation that captures the most sunlight.

What Is the Average Wattage of Solar Panels?

The power rating of solar panels is commonly misunderstood. All panels are tested under equivalent laboratory conditions, and the resulting wattage becomes their rated power. However, the operating conditions in actual projects differ from the ideal lab scenario, and energy production also varies.

Solar panels with 60 cells normally have a wattage in the range of 250 to 350 watts. Some 72-cell panels go above 400 watts, since they have 12 additional solar cells producing electricity.

The controlled laboratory conditions for panel wattage tests differ from those found in most project sites. However, the power rating gives an idea of how solar panels compare with each other. A 360-watt panel will tend to produce around 20% more energy than a 300-watt panel, even if they don’t operate at their rated wattage in actual projects.

Based on the efficiency of the average solar panel, you can expect to convert between 15% and 20% of sunshine into electricity. However, some of the most efficient solar panels available go above 22%.

How Solar Panel Specifications Affect Energy Production

The productivity of solar panels depends on site conditions and the properties of the panels themselves. Site conditions cannot be changed, but the panels can be positioned to get maximum sunshine. With respect to the panels themselves, energy production is strongly dependent on the following specifications:

Panel size

A 72-cell panel has 20% more area than a 60-cell panel, thanks to the 12 additional solar cells. They are more productive simply because they capture more sunlight.

Panel material

Assuming the same size, monocrystalline panels have the highest energy production, followed closely by polycrystalline panels. Thin-film panels produce the least energy per square foot.

Temperature coefficient

Solar panels lose wattage as temperature increases, and this is represented as a percentage loss per degree Celsius. Thin-film panels are the least affected, with losses under 0.30% per °C. On the other hand, mono and polycrystalline panels normally lose over 0.40% power per °C.

Consider that performance loss with temperature is a temporary effect, and it does not represent permanent damage. When the temperature drops, panels recover their lost wattage.

You will notice that 60-cell panels are rated at 20 volts, while 72-cell panels have 24 volts. This data is used by solar installers to design electrical connections, but wattage is the value that matters when estimating the amount of energy produced. Under equal conditions, a 20V 350W panel will have the same productivity as a 24V 350W panel.

close up of a 72 cell black solar panel

Solar panel specifications can change a lot from vendor to vendor, but the way they function stays the same. Installation costs are roughly equivalent for all types.

How Much Electricity Do Solar Panels Produce Each Year?

Solar panels are characterized by their versatility. They can be used in nearly all buildings and climate zones, as long as the following conditions are met:

  • Having a roof with enough structural capacity for the panels, or a large enough property for a ground installation.
  • The prospective area for solar panels should not have serious shading issues. Solar panels produce a lot more energy when there are no shadows.

How much electricity does a solar panel produce? An accurate answer is only possible if a solar company inspects your property, to then design a suitable solar power system. However, there are online solar calculators that provide a broad estimate of production based on your geographic location and electricity consumption.

When comparing sites, a very useful metric is the yearly kilowatt-hour production per kilowatt of installed capacity, or kWh / kW.

  • For example, if your home solar system has an installed capacity of 10 kilowatts, and the output in year was 14,500 kWh, you are getting 1450 kWh per kW.
  • This production rate increases in sunny locations, since there is more solar radiation that can be converted to electricity.

NASA and other scientific institutions have compiled solar productivity data based on location. The SOLARGIS website has solar productivity maps for over 180 countries, and you can check the expected kilowatt-hour production for every kilowatt of solar capacity.

Annual Productivity with Various Solar Panel Wattages and Sunshine Conditions

The following table estimates the kilowatt-hours a solar panel can produce per year, considering five panel wattages and five sunshine conditions:

Solar Panel Wattage

1300 kWh/kW

1500 kWh/kW

1700 kWh/kW

1900 kWh/kW

2100 kWh/kW

240 W






270 W






300 W






330 W






360 W






This table provides an idea of what production to expect from a single solar panel, based on wattage and the local sunshine. However, only a solar company can provide an accurate estimate. A solar system design considers factors like rooftop orientation and the presence of shadows, which are unique for each site.

Solar productivity values in kWh per installed kilowatt normally include the conversion from direct current to alternating current. The DC power output from panels is not suitable for home appliances directly, and it must be converted to AC by an inverter. The best solar inverters have an efficiency of over 97%, but losses are unavoidable because no energy conversion system is perfect.

Since solar panels only operate at rated wattage in laboratory settings, you will find that the inverter is specified smaller than the total wattage of solar panels. For example, you may find that a 5-kW inverter is connected to panels that add up 5.5 or 6 kW of capacity. This may seem like a design mistake at first, but actually it is the best decision:

  • Solar panels operate below their rated wattage most of the time. A larger inverter would simply be wasting capacity while being more expensive.
  • Inverters can “clip” any solar production that exceeds their capacity. They will not be damaged if there is a sudden peak in the amount of power from panels.

How Much Electricity Does a Solar Panel Produce per Month and per Day?

The annual productivity of solar power systems is relatively constant. However, the monthly productivity is more variable due to the effect of the seasons. As you might expect, solar panels are more productive in summer and less productive in winter.

A set of solar panels on a roof that are covered in snow

Using an example from the table above, a 360W panel will produce around 684 kWh per year in a site that offers 1900 kWh/kW. On average, this is equivalent to 57 kWh per month and 1.87 kWh per day. However, the monthly and daily productivity will be above the average value during summer, and below the average value during winter.

Having a higher productivity during the summer months is actually useful, since that is when air conditioners operate at full capacity. The additional power consumption of air conditioners can be offset by the extra production from solar energy systems.

Solar offers from the best companies will normally include production estimates by month. These can give you a better idea of how the productivity of your solar panels will change throughout the year.

Why Solar Panel Output Matters

The productivity of panels is important when designing solar systems, since it determines how many are needed to reach a certain energy production target. When the square feet available are limited, getting the highest possible output from each panel is important.

The sufficient number of solar panels needed to power your home depends on your electricity consumption and savings goal. For example, reducing a power bill by 80% requires more panels that reducing it by 50%. If energy storage is added to use electricity from solar panels at night, the production calculations must also consider the kilowatt-hours required to charge batteries.

Solar shingle installations follow a completely different approach, since solar cells are embedded in roof shingles. This makes them worth installing in new homes, since there is no need to install a separate roof and solar energy system. Conventional solar panels are still the best option for existing homes. Solar shingles would require a complete roof removal in this case, which is very expensive.

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the stacked up solar panels with an energy efficiency chart on top

Understanding Solar Panel Efficiency

Understanding the Fundamentals of Solar Panel Efficiency


Written by qualified solar engineer Leonardo. Last updated:

Typical solar panel efficiency ranges from 15% to 20%, and the most efficient solar panels commercially available are slightly above 22%. Some laboratory prototypes have reached efficiency values over 40%, but they are still very expensive and not viable for commercial use.

In simple terms, solar panel efficiency can be described as the conversion rate from sunlight to electric power. If solar panels from many brands are exposed to the same sunshine, the ones with the highest efficiency will produce the most kilowatt-hours per day.

The efficiency of solar panels is often misunderstood, and a value of 20% may seem small when some natural gas power plants are above 50%. However, there is an important difference:

What Does Solar Panel Efficiency Mean?

The solar panel efficiency describes how much sunlight is converted into electricity. For example, if you place a panel that is 20% efficient under 1,000 watts of sunshine, it will produce 200 watts of electricity.

picture of half a house and half a chart of energy efficiency

In this case it may seem that 800 watts are being wasted, and solar panels often get criticism for their low efficiency. However, consider that all 1,000 watts of sunlight were being wasted before! It would be more correct to say that solar panels obtain electricity from an abundant resource that is otherwise wasted. The outlook for fossil fuels is very different, since all inefficiencies result in wasted fuel, operating expenses and greenhouse gases.

You can use solar energy even if your panels are at the lower end of the efficiency scale. In fact, a lower efficiency often makes the solar system more affordable, and you may get a shorter payback period. If your panels are from a quality brand and covered by solid warranties, your project can be successful even with modest panel efficiency.

What Is the Average Solar Panel Efficiency?

As of 2019, the average solar panel efficiency is from 15% to 20%, but consider that some manufacturers have panels that fall outside this range. The SunPower brand has the current solar panel efficiency record among commercial products, at 22.8% conversion efficiency from sunlight to electricity.

Solar efficiency is provided by manufacturers along with panel specifications. However, you can compare them more easily by looking for a solar panel efficiency chart from a trusted source, such as the National Renewable Energy Laboratory (NREL).

Energy efficiency gets a high priority when deciding if solar panels are worth it. However, keep in mind that a higher efficiency often comes with an increased price. In this case, you must make sure that the additional savings compensate the additional costs.

  • A good recommendation is asking solar companies to provide a financial analysis along with their proposals.
  • The solar panels that achieve the highest return on investment and the shortest payback period will not necessarily be the most efficient ones.

When comparing your options, also make sure you are looking at solar panel efficiency 2019 data. Manufacturers are constantly investing in research and development, to improve the efficiency of their solar cells.

How to Calculate Solar Panel Efficiency?

Solar panel efficiency is calculated with a set of Standard Test Conditions (STC), which are used by the entire solar industry. They are tested in laboratory conditions, with a light source that provides 1,000 watts per square meter, and a solar panel surface temperature of 25°C. Also, the test light source must closely replicate sunlight that has moved through the atmosphere.

When solar panels are installed on homes and businesses, the site conditions differ from the idealized lab conditions. As a consequence, the actual efficiency achieved by solar panels differs from the laboratory efficiency. However, the standard efficiency rating is very useful to compare solar panels under equal conditions.

calculator working out the efficiency of solar panels on a home

Solar panels can also be tested under other conditions called NOCT, which stands for Nominal Operating Cell Temperature. These conditions are designed to simulate a typical project site:

  • A light source that provides 800 watts per square meter.
  • An air temperature of 20°C with a speed of one meter per second.
  • The panels are mounted with an open back side, to allow air circulation.

The NOCT efficiency test considers factors that are ignored in the STC test. However, keep in mind that both are reference values for panel efficiency. To know the exact performance that solar panels can achieve in your property, you must get a professional design that is based on a site assessment.

How to Increase Solar Panel Efficiency?

Solar panels have become more efficient as the manufacturing technology for solar cells has evolved. This factor is beyond the control of the homeowners and businesses who use the panels. However, smart design decisions can also improve the efficiency of a solar energy system.

The solar panel angle efficiency loss is a very important factor during the design process. The orientation of solar panels affects efficiency, and electricity production is increased when they are placed optimally:

  • Solar panels that receive sunlight head-on produce more electricity that those getting sunshine at an angle.
  • Ideally, the panels should have an orientation that maximizes efficiency in the presence of direct sunlight.

Solar companies use several software solutions that calculate the solar panel angle for maximum efficiency. If you live in the northern hemisphere, the south-facing side of your roof will typically get the most sunshine, unless an obstacle is casting a shadow. For countries in the southern hemisphere, the north-facing side of the roof is preferred.

Ground-mounted solar panels have more flexibility with respect to their orientation. Solar companies can calculate the exact angle that maximizes electricity production, to adjust the racking accordingly.

Working with a qualified solar company is important, since the installation quality is just as important as the solar panel quality.

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What are Solar Panels Made Of?

What Are Solar Panels Made Of?


Written by qualified solar engineer Leonardo. Last updated:

Most solar panels are manufactured from silicon. Depending on how silicon is processed, it can be monocrystalline, polycrystalline, or amorphous. Crystalline panels are the most common, while amorphous silicon panels are part of the “thin-film” category, which is used less.

Solar panels generate electricity without moving or producing noise, making them an excellent renewable energy source for buildings. Nobody is exposed to heavy machinery in movement, and the distracting effect of noise is prevented. With these unique features, one of the first questions asked by home or building owners is: “what are solar panels made of?”.

All monocrystalline and polycrystalline panels are made from silicon, but thin-film panels can be produced with other substances. The materials used in solar roofs of the thin-film type include cadmium telluride (CdTe) and copper indium gallium diselenide (CIGS).

Processing Silicon into Solar Cells

By itself, pure silicon does not produce electricity under sunlight. However, other elements can be added in small amounts to achieve this effect. Adding phosphorus produces a surplus of electrons to carry electricity, and the result is N-type silicon. On the other hand, the addition of boron or gallium causes an electron deficit, and the product is called P-type silicon. When both types of silicon are arranged in layers, light induces an electron movement between them, producing an electric power output.

Pure silicon is not found in nature, and instead it must be obtained from silicon dioxide, which contains impurities. Silicon dioxide is melted, and unwanted elements are removed with physical and chemical processes. Once the silicon has been purified, it is converted into N-type or P-type silicon by adding other elements in controlled amounts.

Amorphous silicon is the type used in some thin-film panels, and it gets its name because the molecular structure is not crystalline.

How to Identify the Different Types of Solar Panels

The language used when describing the types of solar panels may sound very technical. However, the three main types can be easily identified based on their appearance.

If a panel has a grid-like surface that is separated into solar cells, it belongs to one of the crystalline types. Monocrystalline panels use only one silicon crystal per cell, and they are characterized by their black color. On the other hand, polycrystalline cells are made of multiple crystals, and they have a lighter blue tone. Solar cells are produced from molten silicon in both cases. However, monocrystalline cells demand more process control to ensure they are made from a single crystal.

set of solar panels with a bright blue sky in the background

Identifying thin-film panels is even easier, since they have a uniform surface without divisions. This is due to their manufacturing process, where the solar material is deposited in layers rather than individual cells.

Before choosing between the solar panel types, the first step is understanding how they work. Consider that electricity is only produced when sunlight is available, and the maximum production is only achieved around noon. If you want to use solar energy 24/7, you must add battery storage for the night or cloudy days.

Comparing the Types of Solar Panels: Advantages and Disadvantages

The different types of solar panels have pros and cons, like in most other decisions that deal with technology.

  • Monocrystalline panels are the most efficient, which means the production of electricity per square foot is higher. Therefore, these panels are the best option if you have limited space for the solar energy system. However, monocrystalline panels are also the most expensive, since they are the most difficult to produce.
  • Polycrystalline panels have a moderate efficiency, but they are also more affordable than monocrystalline panels. They are also the most common type.
  • Thin-film solar panels have the lowest cost and weight. However, they are also the least efficient panels, having the lowest electricity production per square foot. In other words, thin-film panels need more space than crystalline panels to reach a specified capacity. All three types of solar panels lose performance when they heat up, but thin-film panels suffer less from this effect.

The costs associated with installation are similar for all types of solar panels. Thin-film panels are easier to handle thanks to their low weight, but you also need to install more of them. Polycrystalline and monocrystalline panels are similar in terms of weight and size.

The appearance of solar panels is a subjective factor, but it can also influence purchasing decisions. While some users may like the smooth surface of thin-film panels, other may prefer the traditional appearance of crystalline panels. All three types of solar panels achieve good results when installed by a qualified company. However, if you prefer thin-film panels, make sure you have the roof space to accommodate a larger installation.

A worker installing a large set of solar panels on a roof

The solar panel buying information provided by manufacturers contains many details about the panel type and efficiency. Solar installers use these technical specifications to select the best option for your property.

Additional Materials Needed to Produce Solar Panels

Silicon solar cells are the core of solar panels, but other materials are needed to allow their use in outdoor settings. Solar cells are protected by a housing, which is normally produced from aluminum or fiberglass. Also, the side of solar cells that faces the sun is covered by glass, so sunlight can reach them. Most commercial solar panels use either 60 or 72 cells per unit.

Solar panels also have internal wiring, since the solar cells must be connected together to gather their electricity production. The connection terminals of a solar panel are really the ends of a circuit that connects all the cells inside.

It is important to note that solar panel manufacturing methods have evolved over time. At first, solar power was regarded as a technology for satellites and other outer space applications. Therefore, manufacturers focused on lightweight designs. When solar power became a viable electricity source for homes and businesses, panel designs became more robust and durable.

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  1. Solar Photovoltaic cell Basics – Department of Energy
  2. Photovoltaics – SEIA
man checking on the status of his solar panels

How Long do Solar Panels Last?

How Long Do Solar Panels Last?


Written by qualified solar engineer Leonardo. Last updated:

High-quality solar panels last more than 25 years, and their payback period is only between 4 and 8 years. If you purchase panels with a solid warranty, the return on investment is assured. However, keep in mind that warranties are only valid if the panels are installed properly. Working with a qualified solar installer is strongly recommended.

Installing solar panels is one of the most effective ways to reduce your electricity bills. They may seem expensive at first, but their long-term savings are greater than their upfront cost. In other words, every dollar spent on a solar power system is recovered tenfold. After understanding how long solar panels last, it makes complete sense as an investment.

Understanding the Two Types of Solar Panel Warranties

When purchasing warranties, you will notice there are two types. One of them covers manufacturing defects, while the other covers electricity production. Each warranty protects your investment from different issues.

The warranty against manufacturing defects is normally for 10 to 12 years. If your solar panels are correctly installed and any of them fail, this warranty gives you replacements at no cost. Just keep in mind that the faulty panels must be removed and replaced, so make sure your solar provider offers support.

The energy production warranty is much longer, and leading solar manufacturers offer 25 years or more. Solar panels degrade over time like any power generation system, but this warranty covers you if they degrade faster than normal. High-quality panels will have at least 80% of their initial capacity after 25 years, and many warranties use this value.

  • A panel with a power rating of 330W will have dropped to 264W after 25 years.
  • If you use 20 of them in a 6.6-kilowatt system, the capacity after 25 years will be 5.28 kW.

Warranties are only useful if the manufacturer will be around in the future to make them valid. The best recommendation is purchasing panels from Tier 1 solar manufacturers: they offer quality products while being companies with financial health. Your solar warranty becomes useless if the manufacturer goes bankrupt!

Like with any other product, high-quality solar panels from top brands tend have a higher price. However, they are worth it when you consider performance and warranty coverage. Panels can last even longer than their 25-year warranty with adequate maintenance. However, keep in mind that energy production will wane over time, even with top-tier panels.

The long warranty period is one of the main factors that makes solar panels a good investment. Since the typical payback period is shorter than the warranty period, your power bill savings are assured. Just be warned that warranties are voided by an incorrect installation, hence the importance of working with a qualified installer.

Do Solar Panels Save Less Electricity over Time?

Due to the degradation rates of solar panels, you may be thinking that electricity savings will shrink each year. However, consider that kilowatt-hour prices tend to increase over time.

  • If your panels lose 0.8% of their capacity in a year, but the local power company raises its tariffs by 3%, your electricity savings will increase.
  • According to a research project by the National Renewable Energy Laboratory (NREL), most panels degrade at a rate of less than 1% per year.

When solar companies estimate the electricity savings and payback period of a solar energy system, they consider degradation rates. In other words, solar panels are a good investment even with their loss of production over time. Solar panel roofs have become popular for the simple reason that they make financial sense.

Technician checking the performance of a solar panel

If you are planning a home addition in the future, you can simply increase the number of panels. This way, they can keep up with your electricity needs. You must only make sure that the additional panels are compatible with the original installation. You can also ask your solar installer to leave the provisions for an eventual expansion.

How Long Do Solar Inverters and Batteries Last?

Consider that the panels are only one part of an operational solar power system. Components like racking and wiring are very durable, and you can expect them to last as long as the panels. However, solar inverters have a shorter service life than panels, and you must plan for an eventual replacement. The same applies for batteries, in case your solar power system uses them.

Due to the way they work, solar panels produce electric power in the form of direct current (DC). However, your home appliances need alternating current (AC), which is the type of power provided by utility companies. Solar inverters gather the electricity produced by panels, converting it into AC power. However, the life expectancy of an inverter is only around 10 years, which means your panels will eventually need a new one.

The quality of your inverter is just as important as the quality of your panels. The leading inverter suppliers normally offer a 10-year warranty, similar to the panel warranty against manufacturing defects.

A solar power system can work without batteries, making them an optional component. However, they bring additional benefits when present:

  • You can store solar energy for nighttime and cloudy days, which means you rely even less on the local power company.
  • The battery system can assume the role of a backup generator during a blackout.

Lithium-ion batteries are now available with a 10-year warranty. Conventional lead-acid batteries last much less, normally between 1 and 3 years. Lithium-ion batteries are also more flexible and efficient, while lead-acid batteries must be fully charged between discharging periods.

The shorter service life of inverters and batteries does not mean they have a lower quality than solar panels. That is simply the current development stage of those technologies, and it is likely that more durable versions will be available in the near future.

Do Solar Panels Need Maintenance?

Compared with other renewable energy systems, solar panels have simple maintenance needs. If they are kept clean and protected from damage, a long service life is assured. In addition, since the panels don’t have moving parts, they are not exposed to mechanical wear.

Solar providers follow different procedures when calculating the cost of solar panels. When you receive offers, ask the providers about solar maintenance services. In fact, some companies may include a period of free maintenance after installing the solar system.

Worker on his ladders fixing a solar panel

If you get solar power through a lease or Power Purchase Agreement (PPA), the contract will normally make the provider responsible for maintenance. This includes inverter and battery replacements after around 10 years, so you don’t have to plan and budget that purchase. In solar leases and PPAs, the price to pay for these benefits is sharing your savings with the provider.

Like any electrical device, solar panels must be protected with suitable circuit breakers. Panels without adequate electrical protection are more vulnerable to faults, and there is also a higher risk of fire or electric shock. However, this aspect is covered if your system is designed and installed by a qualified solar company.

Consider that 25 years is a long time, and your home surroundings can change. For example, trees around your home can cast shadows on the panels or on your solar panel roof, reducing their energy production. Avoid planting trees in locations where they can cause shading issues for your solar energy system, and make sure you trim any branches that block the sun.

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Are Solar Panels Worth It?

Are Solar Panels Worth It for Your Home?


Written by qualified solar engineer Leonardo. Last updated:

If you have a good site for solar panels then they will be worth the investment. Every $1,000 invested upfront will yield over $3,000 in savings during the next 25 years. Solar panels are like any other investment, where capital is spent in exchange for a greater benefit. In the US, you can expect an upfront cost of around $3 for every watt of installed capacity. This means a 6-kilowatt solar system will cost around $18,000, although prices can change slightly depending on the provider and location.

The first step for knowing whether or not solar panels are worth it is getting detailed solar offers with financial projections. The payback period depends on the monthly savings achieved, and this is determined by two main factors:

  • The solar electricity production per year.
  • The local price of electricity.

If you have a solar energy system that produces 10,000 kWh per year, and your local power company charges 20 cents per kilowatt hour, you save $2,000 per year. However, someone who generates 16,000 kWh and pays 12.5 cents per kWh will also save $2,000 per year.

Other than the solar installation costs and electricity rates, you must consider any local incentives. These normally take the form of tax benefits or cash rebates. They reduce the net cost of solar panels, leading to a higher return on investment. Some states also have Solar Renewable Energy Certificates (SREC), which give you extra cash for every 1000 kWh produced by your home solar system.

10 Financial Facts That Make Going Solar an Easier Decision (Infographic)

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The Costs Involved When Installing Solar Panels?

The first step to analyze solar power as an investment is factoring in how much solar panels cost. As previously mentioned, you can expect an initial investment of $3 per watt. However, this cost can be covered more easily if you look for financing options. If you have access to a low-interest loan, you can go solar with money from a bank, and then pay the debt with solar savings.

Calculating the cost of installing solar panels requires a professional inspection of each property. There are different types of roof structures, and their slope also varies. Since these factors affect the difficulty of solar panel roof installations, they must be considered by solar companies.

A technician installing solar panels on a roof

The use of solar shingles has been increasing, and they allow the construction of roofs with embedded solar cells. They are over two times more expensive than panels, leading to a longer payback period. However, they are a viable option if you are considering a new home, since you don’t have to pay for a separate roof.

To estimate the roof area required for the project, the first step is knowing how many solar panels you need. For example, assume your solar installer suggests a capacity of 6 kilowatts, or 6000 watts. If each panel has a capacity of 250 watts, you need 24. The panels are normally smaller than 20 square feet each, which means this project will use less than 480 square feet.

Which Are the Incentives for Solar Panels?

If you have access to solar incentives, the net cost of your system will be less than the sales price in the solar offers. There are three main types of incentives that reduce the cost of going solar:

  • Tax credits
  • Tax exemptions
  • Cash rebates

Tax exemptions and credits may seem similar, but there is an important difference. When solar energy systems are not subject to a tax that would normally apply, you have an exemption. On the other hand, when you can deduce part of a solar investment from your tax burden, you have a credit. The two types of tax benefits work differently, but their benefit is the same: paying less to own solar panels.

Cash rebates have nothing to do with taxes, since they are simply payments you get for going solar. Rebates are normally offered by local government programs or electricity companies. When both rebates and tax credits are available, the credits are calculated with the net cost after subtracting rebates.

Solar power systems become more affordable each year, which may lead to the conclusion that you should wait for lower prices. However, there is a catch: there is a 30% federal tax credit that ends in 2019, and it will be reduced to 26% and 22% in 2020 and 2021. Once the year 2021 ends, this benefit becomes zero. While the sales price of solar panel systems will continue to decrease, the net price after the tax deduction will increase. This means you are likely to pay more in the short term if you wait, even if the cost of panels continues to drop.

To summarize, the cost of installing a solar system is equivalent to the sales price from your solar installer, minus any incentives available.

How Much Money Do Solar Panels Save?

As previously mentioned, the savings achieved by solar panels depend on how much energy they produce and the local electricity cost. While panels are guaranteed to save money, the exact amount depends on these factors.

  • There is a common misconception that solar energy systems are only useful in sunny places. However, you can get decent savings in place with moderate sunshine and expensive electricity.
  • New York is a good example: the state is not very sunny, but local electricity prices are among the highest in the country. Solar power is growing fast in the state, since the dollar savings are high even with modest sunshine.

Two solar power systems of the same capacity in kilowatts can have different results depending on where they are installed. This is a consequence of the way solar panels work: they only operate at peak capacity when they get full sunshine. At other times, the panels only deliver a fraction of their rated capacity. This is simply how the technology works, and not a quality issue.

Installing efficient solar panels pays off, since they convert a larger portion of sunshine into electricity, which is reflected as extra savings in your electricity bill. It’s important to consider that they last a long time; more than 20 years for high-quality brands.

calculator that reads 'save money' being held up in front of solar panels

Most solar incentives reduce the ownership cost, but there is a specific type that increases the savings achieved: Solar Renewable Energy Certificates (SREC). These programs can be summarized as follows:

  • If you own a solar system, you get one SREC for every 1000 kWh generated.
  • States that have SREC programs also have minimum clean energy requirements for utility companies and large-scale consumers. If these organizations don’t generate or purchase enough clean energy to reach the target, they can fill the gap by purchasing SRECs.
  • By selling SRECs, you get extra cash beyond the solar power savings.

Assume you live in a state where electricity costs 15 cents/kWh and SRECs are sold at $150 each. For every 1000 kWh generated, you save $150 on power bills and get a SREC that sells for an extra $150. The total benefit for every 1000 kWh is $300, which is like saving 30 cents per kWh.

When Is Solar Power a Good Investment?

Are solar panels worth it? As discussed in this article, the answer to this question depends on several factors. Some of them can be controlled, while others are external.

The ideal location for solar power would be a sunny state with expensive electricity and abundant incentives, but this combination is rare. New York is a good example of a state with many favorable conditions, in spite of not being very sunny:

  • The 30% federal tax credit is combined with a 25% state credit, for a total of 55%. In other words, you can deduct more than half of the solar investment from your tax burden.
  • There is a sales tax exemption for solar systems, and a property tax exemption for the increase in home value after installing them.
  • The NY-Sun rebate program covers residential solar systems, as well as commercial and industrial installations.
  • Local electricity prices are among the highest in the country, exceeding 20 cents per kWh in some tariff schedules.
  • There is a net metering program for solar installations up to 25 kW. Any surplus electricity fed back to the grid is credited at retail price on the next power bill.

These are excellent conditions to buy solar panels: their net cost is reduced, and the savings per kWh are high. The lack of sunshine is not an issue in this case, since there are so many financial benefits for going solar.

The best solar companies will provide financial projections with their offers, considering local electricity prices and including any incentives available. Solar power can offer a payback period below 5 years with favorable conditions, which is great for an investment that lasts over 20 years. A solar calculator can estimate your costs and benefits, but only a professional assessment provides an accurate budget and savings estimate.

Keep in mind: you can go solar without assuming the full upfront cost by taking a loan or leasing the solar system. Loan financing makes sense when the terms are favorable, and debt payments are lower than the energy savings. Leasing has the advantage of transferring maintenance responsibilities to the provider, but you lose owner benefits like rebates and tax benefits.

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How do Solar Panels Work?

How do Solar Panels Work?


Written by qualified solar engineer Leonardo. Last updated:

Solar panels work by converting sunlight into electricity at the atomic scale. When solar cells are struck by light, they produce a flow of electrons, or electric current. Since this process happens at such a small scale, it is invisible for humans. Compared with other renewable energy systems, panels are characterized by their lack of movement.

Solar panels produce a certain amount of energy that is determined by two main factors: the amount of sunlight reaching the panel, and the material composition. Some panel materials can collect more sunlight per square foot, leading to a more efficient and compact installation.

Solar panels have become a popular renewable energy option for homes and businesses, and this makes perfect sense when you weigh their costs and benefits. Solar power systems become more affordable each year, while electricity costs continue to rise. From a financial standpoint, adding panels to a building is an excellent investment. In this article we will be answering the common question of “how do solar panels work”?

How Exactly Does a Solar Panel Work?

A solar panel can be viewed as the opposite to an LED bulb, which is also an electronic device that uses semiconductor materials. Just like an LED bulb converts electricity into lighting, a solar panel absorbs light to produce electricity. This behavior is called the photoelectric effect, and it was first studied in the 19th century.

Small diagram of a house with small solar panels and how the convert sunlight to electricity

The name of solar panels can be misleading, since they work with any type of light. If you place a panel under an artificial bright light, it will start to produce electricity. However, only sunlight is a viable energy input, since it is delivered for free. Other light sources have either a fuel cost or an electricity cost.

The material used to make solar panels is normally silicon, which has many applications in the electronics industry. With a special chemical process, silicon can be treated so it will produce electricity in response to ligh541t.

  • Energy conversion begins when a solar cell is hit by photons, which are the elemental particles of light.
  • Photons separate electrons from the silicon atoms, and the movement of electrons is equivalent to electric current.
  • The combined movement of electrons from multiple solar cells provides the total output of a solar panel.
  • The concept is then repeated when the panels are wired together, adding up their individual production.

Producing electricity without moving is a significant advantage of solar power systems. Other generation systems like wind turbines and diesel generators have moving parts, which are subject to mechanical wear. In these cases, the constant need for lubrication and part replacements makes maintenance difficult. Taking care of solar power systems is much easier, since the most demanding maintenance task is keeping their surface clean.

Why Are Solar Panels Connected to an Inverter?

You may have noticed that panels are not connected directly to home appliances. Instead, they are wired together and their electricity production passes through an inverter. This is necessary because the electricity produced by panels does not have the properties required by home appliances.

Solar panels produce direct current (DC) electricity, while home devices use alternating current. A DC power source provides a constant voltage, while an AC source has a voltage that oscillates between positive and negative. Electric companies use AC power because it provides many advantages in electricity generation and transmission.

Basically, a solar inverter converts the DC output of panels into an AC power supply that is suitable for home appliances. Since the power grid also uses AC voltage, it can be synchronized with the solar power system. This has several advantages:

  • When solar power production is not enough for home appliances, any additional electricity can be drawn from the grid without changing any connections.
  • Surplus production can be exported to the grid, to be subtracted from your power bill.

When a solar power system is synchronized with the power network, it is called a grid-tied installation. This is the most affordable system configuration, and also the most common.

What are the Different Types of Solar Panels?

As previously mentioned, solar panels use materials that produce electricity when exposed to light. Most panels are made of crystalline silicon cells that are wired together to add up their voltage. Typically, a panel will have either 60 or 72 cells.

  • A 60-cell panel has 10 rows of six cells.
  • On the other hand, a 72-cell panel has 12 rows of six, making it 20% longer.
  • The amount of solar panels needed for a specific building will change depending on the type. Since 72-cell panels have more cells, they typically have a higher wattage.

60-cell panels are more common in the residential sector, while 72-cell panels are more common in business applications and solar farms. Nothing limits the use of 72-cell panels in home solar systems, but their larger size can be an issue when roof space is limited. 60-cell panels can be used without problem in large commercial buildings as well, but the need to use more of them can increase labor costs.

Two men installing solar panels on a large commercial building

Crystalline silicon panels can be classified into two subtypes. Monocrystalline panels have solar cells made from a single silicon crystal, and their surface is black. On the other hand, polycrystalline panels have blue cells that are made from several crystals. The efficiency of solar panels is higher if they have monocrystalline cells, but their price is also increased.

Some panels do not have silicon cells, and instead they have a uniform surface. These are called thin-film panels, since the material that converts sunlight into electricity is deposited as a layer.

  • These panels have a lower cost that the crystalline ones, but they also need more space to compensate for their lower efficiency.
  • The cost per watt of capacity ends up being similar since the panel has a lower cost — but you need more of them.

Monocrystalline, polycrystalline, and thin-film panels are the three main options available, and the polycrystalline ones have dominated the market. Solar shingles are emerging as a fourth option. They combine roof shingles and panels into a single element.

Understanding the Cost of Installing Solar Panels

The panels themselves only represent a fraction of the cost of a complete solar power system. The costs involved when installing solar panels include special racking, the solar inverter, and electrical protection devices. When all solar costs are factored in, you can expect to pay $3 per watt of capacity in the United States.

As previously discussed, an inverter converts the output of panels into AC power for home appliances. Special racking is used to attach the panels to the roof, since they are not designed for direct installation. Also, solar panels need circuit breakers like any other electrical device. Electrical faults such as short circuits and ground faults can severely damage solar panels and their associated components.

Knowing how to install solar panels has become a useful asset in the United States job market, due to the high demand for solar systems.

Managing Solar Energy Production Effectively

Solar power is clean, and its cost continues to drop each year. However, solar systems still have a limitation that is shared with wind turbines: they depend on variable energy inputs to produce electricity. For this reason, you cannot go off-grid with solar panels alone, and batteries become necessary for nighttime and cloudy days.

Governments and power companies have developed and interesting concept to manage the variable nature of solar power, which is called net metering:

  • Surplus energy production from your solar energy system can be exported to the grid.
  • The power company gives credit for that energy on the next electricity bill.

With net metering, your home can get savings for unused solar energy production. If your solar system is large enough to produce surplus electricity at noon, it can be exported to the grid and deducted from your nighttime consumption.

Solar panels work better when they receive direct sunlight. They can be mounted on tracking mechanisms to always face the sun, but this approach is only recommended when space is a limitation. In most cases, adding more panels is a better option than using a few panels with a solar tracker.

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Man on the roof of a house installing brand new solar panels

How Much Do Solar Panels Cost to Install?

How Much Do Solar Panels Cost to Install?


Written by qualified solar engineer Leonardo. Last updated:

The cost of installing solar panels depends on many factors, but a U.S. homeowner can expect to pay around $3 per watt. For example, a 5000-watt solar panel installation would cost about $15,000. These figures are excluding solar tax credits which reduce costs by 30% to around $10,500.

Solar energy systems experience economies of scale. This means a large installation will tend to have a lower cost per watt, even when the total cost increases. Medium-sized businesses may reach solar system costs below $2 per watt, which is lower than the residential installed cost. In large facilities, solar energy can achieve an installed system cost below $1 per watt.

Residential solar power does not have such a drastic cost variation. However, you can still expect a slight price variation based on scale. A 10-kW solar system is more expensive than a 2-kW installation, but its cost per watt will be slightly lower.

Solar companies often have panel cost calculators on their websites, which gives you an idea of how much you can expect to pay. However, an accurate solar panel installation cost can only be determined with a professional assessment of your property. Keep this in mind when using a solar calculator.

How Much do Solar Panels Cost for an Average House?

Residential solar systems can be found in a wide range of sizes, but the typical household in the United States can get good results with around 5 kilowatts of capacity.

This example assumes a national average solar system capacity of 5kW, but actual projects are based on a professional assessment of each property. The amount of energy solar panels produce is determined by the local sunshine, which means you need more panels in places that get less sunshine.

The amount of solar panels needed for an average house depends on their individual capacity. An installation that uses 250-watt panels will need 20 to reach 5 kilowatts, but a system using 320-watt panels will only require 16. The most efficient solar panels need less space, since you are installing more watts per square foot. However, the specific panel capacity has little effect on the average cost of solar power.

Before purchasing a solar power system for your home, make sure you contact several contractors to compare their solar offers. Your first option will not necessarily be the most affordable.

What Solar Panel System Size Does My Home Need?

Solar panels have a modular design, which allows their use in projects of all scales. However, finding the right system size is a very important design decision. Both undersized and oversized installations have disadvantages.

An undersized installation has a lower price, but the average cost per watt will tend to be higher. This makes the payback period longer, while reducing the return on each dollar spent. If the number of panels is too small for your home, your power bill will only be reduced slightly.

A solar panel system installed on the roof of a small home

On the other hand, oversized solar systems represent a waste of capacity. If your utility company offers net metering, any solar generation you don’t use is exported to the grid and subtracted from your energy bill. However, power companies often place limits for net metering:

  • You can use surplus generation to offset your electricity usage at night. However, in most cases you can only expect to reduce the power bill to zero. Only a few power companies pay you for producing more than what you consume in a year.
  • There may be system size limits for net metering, and any capacity beyond the limit is not eligible.
  • Surplus electricity production is not always credited at the full kilowatt-hour price. Many power companies apply a smaller rate, which reduces the value of surplus generation.

The main factors that determine the optimal solar system capacity are the energy needs of your home and the local rules for net metering. Larger solar power systems with surplus production make sense if these rules are favorable.

Are There Financial Incentives for Residential Solar Panels?

The average price of $15,000 for a 5kW installation ignores the incentives available for solar power throughout the US. Once these benefits are factored in, you can expect to pay much less. The most common types of incentives are the following:

  • Making solar systems exempt from the sales tax or the property tax
  • Federal and state tax credits
  • Rebates, where the power company or local government gives you an upfront cash incentive for going solar

Tax exemptions are great, since they reduce the ownership cost of solar panels directly. Solar tax credits do not reduce the installation cost directly, but they let you deduct a percentage from your tax burden. The US has a 30% federal tax credit for solar installations, which applies for the entire country until the end of 2019.

Solar rebates are cash incentives that reduce the net cost of the installation. When rebates and tax incentives are available in the same location, the credits are calculated with the net price after subtracting the rebate.

Of all the incentives mentioned in this section, only the 30% solar tax incentive from the federal government applies in the entire country. The availability of state tax benefits and rebates changes by location.

What Happens to the Federal Solar Tax Credit After 2019?

Thanks to the 30% federal tax credit, a solar installation with a sales price of $15,000 has a net cost of only $10,500. However, this incentive will be gradually reduced between 2020 and 2022. The following table demonstrates how the federal incentive would drop in the case of a 5-kW system with a price of $15,000.


Solar Tax Credit (%)

Tax Deduction ($)

Net Cost ($)

















The federal tax incentive becomes 0% for residential solar energy systems in 2022, and only a 10% credit will remain for commercial installations. Even if the cost of solar panels continues to decrease during the next years, they will seem to be more expensive as the tax incentive is phased out. The solar panel costs that are possible in 2019 thanks to the tax deduction will not be available again, until the sales price of solar systems decreases by 30%.

The 30% federal tax credit applies for solar batteries as well, but there are two conditions:

  • Batteries only get the credit if they get at least 75% of their charge from solar panels or another eligible renewable energy system.
  • The solar panels and the batteries must have the same owner.

The credit given for batteries is based on their solar charging percentage. For example, a home battery that gets 80% of its charge from solar panels gets 80% of the credit, equivalent to 24%. On the other hand, a battery that is fully charged with solar generation gets the full credit of 30%.

When using a solar panel cost calculator, check if the tool deducts tax benefits automatically. Some solar providers have this feature built in, while others calculate the price before incentives.

Understanding the Price of Solar Panels

If you look for solar panels online, you will notice that the cost per watt is much lower than $3. However, the number is lower because only solar panel prices are considered. Some manufacturers have achieved solar panel costs below $0.30 per watt.

Small home with solar panels on top of a calculator

A complete solar system is much more expensive than the individual panels. However, it makes sense once you learn how solar panels are installed:

  • To be installed safely on your rooftop, solar panels are mounted on special racking.
  • Solar panels must also be connected together with special wiring, in order to collect their energy production.
  • Because of how the solar panels work, electricity is produced as direct current. A solar inverter converts the electric power into alternating current, which is suitable for home appliance.
  • Like any electrical installation, a solar system must be protected by special breakers. These are found inside a fuse box.

All of these components count towards the total price of a solar power system, and you must consider there are delivery costs as well. Also, keep in mind that solar companies are businesses after all, and they add a profit margin. You can find the best solar company by comparing several offers.

The prices discussed in this article are for conventional solar systems. Solar roofs are much more expensive, typically above $8 per watt. However, solar shingles can be viable in new constructions, since the consolidate the roof and the panels into a single element.

Recommendations When Purchasing a Solar Panel System

The installation cost of solar panels is important, buy focusing on price only is not the best approach. When comparing offers from different solar contractors, consider the following aspects:

  • How long solar panels last: Solar panels can be expected to last for over two decades, but make sure you are covered by warranties. The best solar panels come with a 10-year warranty against manufacturing defects. There is also a 25-year warranty for energy production above 80% of the rated value.
  • Knowing how efficient solar panels are: Solar panel efficiency can be estimated by dividing their rated wattage and area. If two panels of the same size and different brands are rated at 320W and 250W, the 320W panel is more efficient. High efficiency panels use the available space more effectively, but this is only an issue if your roof space is limited.
  • The amount of money solar panels save you: Offers from solar companies may differ not only in price, but also in savings achieved. There may be cases where a more expensive system also produces more energy, and its extra cost is recovered many times as power bill savings.

When negotiating with solar installers, ask for a detailed budget of the project. The solar offers should be broken down into line items with unit prices, instead of presenting a lump sum. This way you can compare individual components, and you get a clear picture of what you are purchasing. When a lump sum is provided, there is no information on how the solar cost is broken down, and there could be hidden costs.

The solar system price you get should cover all components and activities necessary to have the panels installed and operational. Ask your solar contractor if the following costs are covered:

  • Solar panel and component deliveries
  • Taxes, work permits, and interconnection fees

A complete solar offer also includes a savings estimate with the expected kilowatt-hour output. While this is not part of the project cost, it gives you an idea of the payback period and return on investment. The solar offer with the lowest cost per watt will not necessarily be the one with the best performance.

Install Solar Panels at Zero Upfront Cost

Solar power offers an attractive return on investment for homeowners, but the upfront cost can be high. However, there is no need to assume the full cost at once. Many banks offer solar panel finance options, which bring several benefits:

  • The upfront cost is covered by the bank’s money.
  • Loan payments are covered by the solar savings.

This approach works best if you have access to favorable loan conditions, such as a low interest rate and a long repayment period. High-interest financing options such as credit cards are not viable if you want a solar panel installation to pay itself.

If you are unwilling to take a loan to install a solar power system, leasing is also a viable option. The solar panel lease cost is calculated to be lower than the power bill savings, leaving cash in your pocket from the first month of use.

When choosing between solar loans and leasing, consider the pros and cons of each option. Loan financing lets you claim the solar tax credits and rebates, since you own the installation. However, you are fully responsible for system maintenance and component replacements. On the other hand, a solar lease makes the provider responsible for maintenance, but you lose the ownership benefits.

An online solar panel calculator is useful as a starting point for a purchase decision. However, it cannot replace a professional assessment. There are many site-specific factors that affect the cost of a solar energy system. The cost varies by state, so that is also something important to consider.

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multiple solar panels on a house

How Many Solar Panels Do You Need?

How Many Solar Panels Do You Need to Power Your Home?


Written by qualified solar engineer Leonardo. Last updated:

A home that consumes 1,000 kWh per month will normally need between 20 and 30 solar panels. The exact number changes depending on the specifications of the chosen panel model, as well as the sunshine available at the project site. Before purchasing a solar energy system for your home, an important step is finding out how many solar panels you need.

Solar Panel Calculator

Solar Calculator
1. How many kilowatt hours (kWh) do you use per month?
2. What percentage of this power do you want to offset with solar?
3. Which state is your house in?

Minimum PV System Size (in watts)
Recommended PV System Size (in watts)

Solar panels have been successful as a clean energy source thanks to their modular design. You can purchase just the right number of panels according to your home needs, instead of having to choose between predetermined system sizes. Solar energy can adapt to buildings of any scale, ranging from small homes to large industrial parks.

To size a solar system correctly, the best recommendation is getting in touch with a qualified solar contractor. He/she will also help you in knowing how much solar panels cost to install. A residential system has an average installed price of $3 per watt. Solar installers consider the following factors to calculate the number of panels needed:

  • Local sunshine: How much energy a solar panel produces depends on the sunlight received. If two homes in different locations need the same amount of energy, the home with the sunniest weather will need less panels.
  • Home size and energy usage: A larger home typically needs more panels to cover its consumption. However, usage habits and the efficiency of home appliances are also important. Two homes of the same size can have very different energy needs.
  • Panel specifications: The power rating of panels varies depending on the model and manufacturer, but most range from 250 watts to 330 watts. For any given energy production target, you need fewer panels if their individual wattage is higher. When roof size is limited, efficient panels with a high wattage can make the system more compact.

How Many Solar Panels do I Need – Solar System Size Comparison

System Size

Average Annual KWh Production

Estimated Number of Solar Panels Needed






















How to use a Calculator to Calculate how Many Solar Panels you Need

Our solar calculator can estimate the number of panels needed for your home. The tool works by taking your average monthly energy usage in kilowatt hours (kWh).

  • Calculators that use kilowatt hours are more accurate because they consider your exact energy needs
  • Those that ask for home area must assume the electricity consumption

Each electric company has a different power bill format, but they all display your electricity consumption for the billing period. The exact description will vary, but you should look for a term such as “kWh used” or “kWh consumed”.

Solar calculators also ask for your home location to determine how much sunshine is available. Based on those two values, they can estimate the system size in kilowatts. Some solar calculators assume a wattage for panels, while others ask you directly. Based on the total kilowatts and the rated watts per panel, the calculator can determine how many are needed.

woman calculating how much she saves by using solar panels on her house

It is important to understand the difference between kWh savings and dollar savings. kWh savings refer to the amount of energy that your panels produce. On the other hand, dollar savings are obtained when the solar electricity production is multiplied by the kWh price.

How Many Solar Panels do you Need for 1000 kWh per Month?

A family with several siblings can easily reach a monthly consumption of 1,000 kWh. In places with expensive electricity, this results in monthly electric bills of over $200. However, solar power is an effective solution to reduce energy expenses.

As explained above, the number of panels needed to reach 1,000 kWh per month changes depending on local sunshine and panel wattage. To simplify calculations, solar radiation is specified in peak sun-hours per day. Weather scientists calculate this value by measuring the total sunshine in a location and converting it to equivalent hours of peak sunshine.

  • Peak sun hours should not be confused with daylight hours
  • Since sunlight is moderate in the early morning and late afternoon, these hours do not count as complete peak sun hours
  • You may find a site that gets 12 hours of average daylight, and 6 peak sun hours per day

There are many online databases that provide peak sun hours based on site coordinates, including the Atmospheric Science Data Center from NASA. Once you know the peak sun hours, estimating the number of solar panels needed for 1,000 kWh is simple.

  • The first step is calculating the kilowatts needed. You must simply divide the average daily kWh by the peak sun hours
  • Assuming a 30-day month, an electricity generation of 1,000 kWh is equivalent to 33.33 kWh per day
  • If the site gets 6 peak sun hours per day, you need 5.56 kilowatts

Since no energy conversion system is perfect, you cannot assume the solar array will deliver its theoretical production. To compensate for this, you can increase the calculated wattage by 20%. In the example above, adding 20% yields a capacity of 6.67 kW or 6670 watts. The final step is dividing the total wattage by the individual panel watts.

  • If you use 250W panels, you need 27 of them
  • On the other hand, if they are 330W panels, only 21 are needed

Solar shingles are smaller than panels, and their wattage is lower as a result. However, you can use the same procedure to estimate how many are needed. For example, if the amount of power needed is 5,000 watts and each shingle is rated at 50W, you need 100.

How Many Solar Panels do you Need for a 2000 Sq. Ft. Home?

Estimating the number of panels based on home area is an indirect approach, since you must assume the kWh consumption. Some homes have more efficient appliances, and habits also influence electricity usage. However, average values can be calculated from official data:

  • The US Energy Information Administration estimated that the average home uses 867 kWh monthly
  • The US Census Bureau determined that single-family homes have an average area of 2467 square feet
  • When dividing these values, you obtain 0.35 kWh per square foot

Assuming 0.35 kWh for a 2,000 sq. ft. home, the estimated electricity consumption is 700 kWh. At this point, you can use the calculation procedure described in the previous section. Considering 6 peak sun hours per day and 300-watt panels, you need 16 to produce 700 kWh each month.

If you have limited roof space, the best recommendation is installing the most efficient solar panels available. This will maximize the watts installed per square foot, compensating the area limitation. Finding out how efficient solar panels are is simple: you must only divide their individual wattage and area. The panels with the most watts per square foot have the highest efficiency.

How Many Solar Panels do you Need for Common Household Items?

If you are considering solar energy for your home, you may also be asking how many panels are needed to power specific appliances. However, it is important to understand how solar generation works:

  • Solar systems deliver most of their energy production in the hours around noon
  • During the early morning and late in the afternoon, solar generation is much lower. This is because there is less sunlight reaching the panels
  • Households have the highest energy consumption in the evening and early morning

Since solar panels depend on sunlight, you cannot control their electricity production. Powering home appliances directly with panels is impractical and potentially dangerous, unless you use a solar battery to store energy. If you connect home appliances directly to the panels and inverter, a dark cloud passing over your home will shut off the power. At night, you would have to switch to the local power supply anyway.

house appliances next to a solar panel

The most practical solution is synchronizing solar systems with the local power supply, which lets them operate as a single power source. When solar generation cannot power your home appliances by itself, the rest of the energy comes from the grid. If your panels have surplus production, you can send it to grid to get a credit on the next electricity bill.

Sunlight is a variable input, and your electrical devices need 24/7 availability. For this reason, you cannot compare the wattage of panels directly with that of home appliances. Instead, you must balance the kWh produced with the kWh consumed. The following table estimates the number of solar panels needed for common appliances, assuming 300-watt panels and 5 peak sunlight hours per day.



Monthly kWh

Panels Needed

20 LED bulbs

10 watts each

6 hours per day



12,000 BTU/h

Mini-split AC

SEER 16 efficiency

8 hours per day




Always on



Water Heater, 5 kW

2 hours per day



This table considers the most power-hungry appliances found in homes. Most small appliances and electronic devices have a very low consumption, which does not even match the production of one panel.

How Many Hours of Daily Sunlight Does Your State Receive?

The sunlight available to produce electricity varies greatly throughout the United States. Southwest states like California and Arizona get the most sunshine, while northeast states like New York and Massachusetts get the least.

However, you should not discard solar power just because you live in a state that isn’t sunny. For example, New York only gets moderate sunshine, but it has very high electricity prices. Solar panels are worth it in this case, since they achieve high savings even with reduced production. Saving 750 kWh when you are charged 25 cents/kWh is better than saving 1,000 kWh at 12 cents.

After estimating how many panels are needed in your home, you can make better purchasing decisions. Keep in mind that you don’t have to pay the full system cost upfront. Many banks finance for solar panels, and you can pay off the loan with the electricity savings achieved. Leasing solar panels is also a viable option, where you pay a monthly price instead of purchasing the system. Your local solar installer may offer several purchasing options, adapting to your needs.

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