How Much Do Solar Panels Cost In Colorado? (2023)

byAdmin -October 09, 2023

Cost of solar panels in Colorado. On-site installation price

According to our research, solar panel systems in Colorado typically cost $2.82 per watt, which is closer to the average of $2.85 per watt. The following table provides price estimates for photovoltaic (PV) systems ranging from 5 to 10 kW, a typical size range for residential systems.

*Average values based on market research and surveys of 1,000 homeowners as of March 2023. Actual cost may vary depending on your location, installer, equipment and site conditions.

You can use our solar calculator to estimate the cost of solar panels in your area.

What affects the cost of solar panels in Colorado?

The size of the solar panel system is a major determinant of cost. For example, a 10 kW solar system will cost more than a 5 kW system. However, other factors affect the cost, such as the types of equipment used, your installer, and where you live.

Size of the solar system

A larger solar system costs more because it uses more solar panels, accessories and labor. As the number of panels increases, you will need more cables to connect equipment and more racks to hold the panels in place. You'll also need a large inverter to convert the direct current (DC) electricity generated by your panels into the alternating current (AC) needed to power your home.

The best solar companies can calculate the ideal size for your home system based on your monthly energy bill. Reputable installers will conduct a site survey to determine which areas of the roof receive the most sunlight throughout the year.

Additional components also increase the cost of solar power. For example, installing a solar panel to meet your home's energy needs at night can add more than $10,000 to your budget.

Types of solar panels

Installers divide solar panels into three types based on the photovoltaic components used to convert sunlight into electricity.

Monocrystalline panels are the most popular choice for residential applications due to their high efficiency, producing more kWh of energy per square foot of coverage. Although monocrystalline panels are more expensive than other options, you can expect more power, especially with the Colorado sun.

Your installer and financing options

The total cost will depend on the installer you choose and how you pay for your system. Some installers are more expensive than others, and the price of equipment also affects the cost of the system. For example, homeowners on a budget can choose cheaper solar panels to save money.

You'll save the most by paying cash for your system, which will avoid interest on your solar loan over time. However, if you can't afford the upfront cost of solar, financing your panels with a loan offers a more manageable monthly payment. You'll realize minimal savings over time with solar leases and power purchase agreements (PPAs), neither of which qualify you for solar incentives.

Solar panels purchased for cash or on credit can qualify for a combination of incentives that will reduce your upfront costs. Common solar starters include:

Fiscal advantages. Tax incentives offered at the federal and sometimes state level help reduce the cost of a solar system and the income tax burden.
Tax advantages :
Solar Solar Rebates and Assistance. Some states, local governments, and utility companies offer cash incentives for tanning. Examples include discounts for government agencies or local services, as well as grant programs for nonprofit organizations.

Colorado residents benefit from three types of solar incentives:

Solar Incentives in Colorado

Colorado solar incentives can help reduce the overall cost of your solar system and improve your return on investment. There are several incentives for homeowners in the Centennial State, including:

Federal Sunshine Tax Credit

Like other U.S. states, Colorado homeowners have access to a federal solar tax credit, officially called the Solar Investment Tax Credit (ITC). This federal program allows you to claim 30% of the total cost of the solar energy system as a tax credit for the year the panels are installed. If you can't apply for a full loan, you can extend the balance for up to five years.

State and local benefits in Colorado

Colorado offers several incentives to help reduce the overall cost of solar energy systems, including:

Exemption from sales and use taxes . The state does not impose a 2.9% sales tax on residential solar panels and other renewable energy systems.
Property tax exemption . If your home's value increases after installing solar panels, Colorado will exempt you from paying additional property taxes. For example, if installing solar panels increases the value of your property from $350,000 to $380,000, you will pay $350,000 in property taxes.
Holy Cross Energy Rebates . Holy Cross Energy offers customers $250 per kilowatt of installed solar capacity for solar home systems up to 6 kilowatts. The company offers $100 per kilowatt for large systems up to 25 kilowatts.
Energy Smart Colorado . This program offers cash incentives of up to $2,500 for home solar systems, but availability varies by location and power company.
Colorado Home Energy Improvement Loan (RENU) . A program offering low-interest home improvement loans of up to $75,000 with a 20-year repayment term.

Your solar installer should be familiar with state and local incentives and can help you apply programs as part of your solar plan.

Colorado Net Metering Policy

Net metering is an electricity billing program available in many parts of the country, including Colorado. With net metering, you can send excess energy generated by your system to the grid and receive credits on your energy bill. Your utility provider will automatically deduct the credits you earn from your bill, helping you cover your grid's electricity usage when your solar panels aren't producing electricity (like at night).

Colorado has an adequate energy metering program. When you send excess solar power to the grid, you receive a credit for the full cost per kilowatt hour of retail electricity. Other states have less favorable policies, offering only partial credits for excess solar energy. Your solar installer can help you implement net metering.

Best Solar Installation Company in Colorado

There are about 400 solar energy companies operating in Colorado, according to the SEIA. Based on our research and reviews, some of the best options for solar installers in Colorado include:

Should you use solar panels in Colorado?

Thanks to the state's abundant sunshine, a 6-kilowatt solar system can produce more than 9,600 kWh per year in cities like Denver or Colorado Springs. The U.S. Energy Information Administration reports that the average cost of electricity in Colorado is 14.37 cents per kilowatt hour, which means you can save $1,380 on annual energy costs.

At an average price of $2.82 per watt, a 6 kW system would cost approximately $16,920. After subtracting the 30% federal tax credit, the net asset value drops to $11,844 with a payback period of 8.6 years.

The best solar panel companies will extend your solar panel warranty to 25 years, which is much longer than the payback period provided in the example above. Reputable installers will also provide technical product warranties and performance guarantees, providing additional protection to your clean energy investment.

While investing in solar technology is ultimately up to you, going solar in Colorado may be worth it if you want to save on your energy bills and offset your home's carbon footprint.

How we collected cost data

We have conducted extensive research and considered a number of factors to determine our costs, including:

Investigate. In March 2023, we surveyed 1,000 homes with photovoltaic systems about the cost of solar panels, then compared average prices by system size and installer.
Look for reliable sources. We compiled data from trusted solar energy sources like the Solar Energy Administration (SEIA), National Renewable Energy Laboratory (NREL), and Energy Information Administration (EIA) to determine the national average cost of solar panels. Cost of Electricity and Solar Energy Systems by State.
Expert Advice. We spoke with experts like Jesse Solomon, co-founder of NCSolarNow, to understand the cost of going solar for consumers and utilities.