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Solar panel installations vary in cost from state to state, roof to roof and contractor to contractor. To compare costs across projects, the solar industry talks about the cost of installations in watts per dollar: the total capacity of a solar installation divided by its cost. Solar panel costs are falling but for uneven reasons. While hardware costs are falling faster than labor, permitting and other "soft costs."
The cost of panels is also affected by incentives like the federal investment tax credit for solar, which returns 30% of the cost of a solar panel installation come tax time.
The volume of solar installations in the Dakotas and Nebraska is among the lowest in the country, so much so that there isn't enough meaningful data to talk about average solar prices in those states. Across the rest of the region, pricing tends to be above average compared to the rest of the nation, according to FindEnergy data.
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System size (kW) | Price per watt | Installed cost | |
---|---|---|---|
Iowa | 8 | $4.01 | $32,040 |
Illinois | 7 | $3.76 | $26,288 |
Indiana | 9 | $4.10 | $36,857 |
Kansas | 8 | $3.34 | $26,720 |
Michigan | 7 | $4.06 | $28,389 |
Minnesota | 7 | $4.03 | $28,229 |
Missouri | 10 | $3.37 | $33,678 |
Nebraska | N/A | N/A | N/A |
North Dakota | N/A | N/A | N/A |
Ohio | 9 | $3.41 | $30,732 |
South Dakota | N/A | N/A | N/A |
Wisconsin | 7 | $3.88 | $27,175 |
Nationwide | 8.6 | $3.67 | $31,558 |
The infographic below charts the average total cash price, cost per watt and system size for a solar panel system in your state, according to data from FindEnergy.com. Any prices you see don't account for tax credits or state incentives. Certain states don't have any FindEnergy solar data and are grayed out on the map.
A solar system can be a big purchase to save up for, although some argue it's one of the last things you should save for. That's partly because there are so many ways to finance a system and then accumulate savings from one right away.
Cash: If you do opt to gather up all the cash in advance of scheduling an installation or you already have it lying around, surely some installer will accept it. It's also a good time to start saving thanks to decent rates in numerous high yield savings accounts.
Solar loan: A few installers and financial institutions offer loans designed with solar in mind. Ask around in your area and also check with banks, credit unions and even government agencies and nonprofits working on energy issues about options.
Other types of loans: Aside from solar loans you can typically bring your own financing to any solar project, be it a personal loan, home equity loan or HELOC.
Lease or power purchase agreement: There are even options that don't require buying your solar system. It's possible to lease panels for a monthly rate over a certain term just like you might a car or office. Another arrangement is a power purchase agreement in which a solar company essentially leases your roof and agrees to sell you the power produced for a favorable rate. This looks similar to a lease in practice, but with monthly payments that fluctuate based on your energy usage. One downside to these arrangements is that they can be tough to get out of if you find yourself needing to move.
No matter where you live in the region, you should be eligible for the federal clean energy credit that allows you to get up to 30% of the cost of your solar installation back in the form of a reduction to your income tax liability.
The state of Illinois also adds some generous incentives of its own, as Newell pointed out. This includes the Illinois Shines program that can offset up to a third of the cost of a system (in addition to the federal credit) by prepaying for 15 years of renewable energy credit that your system will produce. Another program helps pay for upfront costs for lower-income families.
Wisconsin also offers a one-time $500 rebate while Minnesota residents may be able to receive as much as $5,000 or more back in rebates depending on their utility.
Meanwhile, things are moving in the other direction in neighboring Indiana, where net metering for residential solar is being rolled back. Other states like Missouri, Iowa, Kansas, Nebraska, North Dakota and South Dakota offer property or sales tax exemptions but little else in terms of incentives.
Newell said Illinois' big investment in solar is thanks to a long history of organizing and advocacy in the state.
"I am hopeful, but I haven't seen it yet in other places (in the Midwest)," she said.
The Midwest doesn't have quite as many peak sun hours as the southern reaches of the country, but it still has more than enough potential to make solar systems worthwhile.
"Even in the winter time we can get a significant amount of sun," Newell said.
She pointed out that the Midwest also has an abundance of other resources that can be scarce elsewhere.
"We have a lot of land here."
Some of that land is what is known as brownfields, which are usually defined as land that's contaminated in some way and can't be developed. "Except you can put solar panels on brownfields," she added.
One such project outside Springfield, Illinois will be one of the largest in the country, producing over 800 megawatts starting as soon as 2024 to offset a majority of Chicago's energy usage.
In addition to figuring out how much you might save over time, there are other considerations to take into account before signing any solar contract.
The condition of your roof: Solar panels are meant to be permanent, so if your roof doesn't have enough life left in it to support them for the long haul, consider replacing it beforehand.
HOA and neighborhood regulations: You'll need permission to operate your solar system from your utility and regulators, but you might also require a thumbs up from your homeowners or neighborhood association. Keep in mind that most states ensure certain rights to install solar and maintain solar easements.
Insurance coverage: A solar system may impact your homeowners or other relevant policies. Be sure to check the fine print before making a final decision.
Your location: In the Midwest, you'll typically receive more average sunlight hours the farther south you are, but any place receives adequate sun to at least consider solar. It's still a relevant data point to have when figuring out the payback period for a potential system.
The companies we listed above as "the best" are curated from CNET's best solar companies list. Companies making the best list are scored on the equipment, warranties and customer service they offer. Then, we make sure these recommendations are available in your state. You can read a full breakdown of how we review solar companies here.
Companies listed under the local installers were chosen in a less rigorous way. We chose them because they offered something unique or notable to customers in the state, they seemed well-regarded by internet reviewers or because they were one of the few installers we could find information on in the state.
Whether we've completed a full review on a company or not, it's always a good idea to get multiple quotes from different installers before choosing a company.
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Do solar panels save money?
Solar panels can save money over time by providing energy that would otherwise be purchased from a utility. Some utilities offer credits for solar energy production released to the grid via net metering.
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Net metering is a system, usually enshrined in state law, through which utilities are required to compensate homeowners who install solar energy on a home that is connected to the grid when the energy produced is made available for others to consume via the same grid.
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Source: cnet.com