THE INSTALLATION COSTS OF A HOME SOLAR POWER SYSTEM

WHAT AFFECTS YOUR PRICES

A solar electric (photovoltaic) power system allows you to reduce the amount of electricity you buy or even sell its excess back to the utility, makes you less vulnerable to future price increases, and reduces air pollution.

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However such a system requires a substantial initial investment. The prices of a PV system depends primarily on its output power rating. That's why its cost is usually compared in terms of dollars per watt. Currently, the installed costs of most complete residential PV systems vary from $7 to $11 per watt (which is $7,000-$11,000 per kilowatt) before any financial incentives or tax credits. That includes the panels, inverters, wiring, hardware and labor. The actual number depends on manufacturer, retailer, and installer, as well as your system's configuration and equipment options. It also varies widely across states. The per-kW rates are the highest for smaller systems (≤2 kW): $9.2/W in average. Larger systems run in average for $8/W. More than half of this amount is driven by the cost of PV panels. A battery based backup system runs about 20-30% more. Various federal, state and utility incentives can offset up to half of the above installation expenses: in 2008, the average net installed cost for homeowners after incentives was $5.4/W.

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ESTIMATING THE SYSTEM's SIZE AND THE PRICE.

This solar system cost calculator helps you estimate the size and cost of a PV electric system in your area. Note that it provides only a rough estimate, and may not necessarily take into an account all federal, state, or local incentives and rebates. These numbers do not include a possible roof reinforcement which may be required.
To use the calculator you need to decide what percentage of your average electricity usage do you want to meet with your solar system. You may choose of course to generate all of your electricity with the sun, however this will result in an oversized system and may not be the most cost effective solution. Most homeowners which are connected to an utility grid, install a smaller system that meets most of their need and rely on the grid for the times of peak energy use. According to National Renewable Energy Laboratory of U.S. Department of Energy, the average US home can meet 80% of its electricity needs with a 2-kW system. The estimated price in this calculator is based on the assumption of $8000/kW, which is an average price of an installed residential PV electric system rated above 2 kW before incentives.
The calculator also gives you for a reference rough estimates on how much carbon emissions your current electricity usage generates.

References and additional information:
The Installed Cost of Photovoltaics in the U.S. from 1998–2008
The Database of federal, state, local, and utility incentives for renewable energy

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