Table of Contents
- What to know?
- How long does it take to see a return on your investment in Michigan?
- Is Michigan good for home solar panels?
- How to pay for solar panels in Michigan
- What affects the cost of solar panels in Michigan?
- How to save on Michigan solar panel costs
- Michigan-specific solar considerations
- Who are the best solar installers in Michigan?
What to know
- Cost: About $13,755 for a 5 kW system to $16,506 for a 6 kW system after tax credit.
- Savings: 10 year payback; about $14,635 saved over 20 years.
- Environmental benefits: Potential to reduce your carbon emissions significantly.
Going solar in Michigan now averages about $3.94 per watt. That means you can expect to pay roughly $3,936 per kilowatt (kW) of installed capacity before incentives. For example, a 5 kW system typically costs around $19,650 before applying the 30% federal tax credit. Once you factor in that tax credit, the out-of-pocket cost for a 5 kW installation comes to about $13,755
However, a 5 kW system isn’t necessarily the best size for homeowners in Michigan. According to our data, Michigan residents currently pay an average of 19.09¢ per kWh, with a typical electric bill of around $118.27 per month for 619 kWh of consumption. Considering this energy usage, a 6 kW system is ideal to cover the energy needs of most.
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How long does it take to see a return on your investment in Michigan?
The upfront cost is what you pay for a system (whether you pay cash or finance doesn’t factor in this equation). The payback period is the amount of time until you break even on your investment considering savings from energy bills. And the net 20-year savings is what you save over 20 years minus the upfront costs. All of these work together to show how much you could save with solar in the state.
| 5 kWh System | Michigan Average | U.S. Average |
|---|---|---|
| Upfront Cost | $13,755 | $12,530 |
| Payback period | 10 Years | 7 Years |
| Net 20-year savings | $14,635 | $21,888 |
| *These are estimates. Getting personalized quotes from local installers is crucial for accurate pricing. | ||
Federal tax credit impact: The 30% federal Residential Clean Energy Credit significantly reduces your installation costs. For example, a $20,000 system would cost you $14,000 after the credit.
Is Michigan good for home solar panels?
To gauge potential, we look at average roof size, system capacity, and electrical production.
- Roof size: 644 sq. ft.
- System capacity: Up to 9,746 kW DC
- Electricity production: About 1,310 kWh AC per year
On average, a solar power system in Michigan can lower your electricity bill and pay for itself over time.
Below you can see power generation, cost, and savings of different system sizes.
| 2 kW System | 3 kW System | 4 kW System | 5 kW System | 6 kW System | |
|---|---|---|---|---|---|
| Roof Space | 143 ft² | 215 ft² | 286 ft² | 358 ft² | 429 ft² |
| Annual power value | $500 | $750 | $1,001 | $1,251 | $1,419 |
| Average cost | $5,502 | $8,253 | $11,004 | $13,755 | $16,506 |
| Average yearly production | 2,620 kWh | 3,930 kWh | 5,240 kWh | 6,550 kWh | 7,860 kWh |
| Average monthly savings* | $41.69 | $62.53 | $83.38 | $104.22 | $118.27 |
| Full payback period | 4 years | 6 years | 8 years | 10 years | 12 years |
| CO₂ reduction per year | 1.88 tons | 2.82 tons | 3.76 tons | 4.70 tons | 5.33 tons |
| *Savings assume a $118.27 monthly electricity bill | |||||
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How to pay for solar panels in Michigan
Purchasing solar panels is no small task. Here are a few ways you can pay for solar:
- Cash purchase: This is the best choice if you can afford it. Paying in cash gives you the best long-term savings but requires a larger upfront investment, of course.
- Solar loans: You can spread the cost over time with a loan, but be mindful of interest rates and loan terms.
- Solar leases and PPAs: Power purchase agreements (PPA) and leases have lower upfront costs. However, you don't own the system, which means you save the least over time. There can also be complications if you want to sell your home.
What affects the cost of solar panels in Michigan?
Several factors impact the final price of your solar installation:
- System size: Larger systems cost more upfront but often yield greater long-term savings.
- Panel type and efficiency: Monocrystalline panels are generally more efficient and expensive than polycrystalline or thin-film options.
- Installation complexity: Roof type, shading, and site-specific challenges can increase installation costs. Permitting and inspection fees also factor in.
- Additional considerations: Battery storage adds to the initial investment but provides backup power and greater energy independence. Labor and installation quality are also essential cost considerations.
How to save on Michigan solar panel costs
Getting the most bang for your buck is essential when investing in solar. Here are some strategies to save money:
- Maximize the federal tax credit: Understand the eligibility requirements and claim the full 30% credit.
- Shop around for quotes: Get quotes from multiple installers to compare pricing and services. Don't just focus on the lowest price; consider reputation, experience, and warranty.
- Consider system size: Be careful of going overboard. A properly sized system will meet your energy needs without unnecessary costs. Analyze your energy usage to determine the optimal size.
- Explore financing options: Compare loan interest rates and terms carefully. If considering a lease or PPA, understand the long-term implications and potential trade-offs. Cash purchases often offer the best long-term savings.
- Negotiate with installers: Don't be afraid to negotiate on price. Inquire about any discounts or promotions they may offer.
- Optimize your home's energy efficiency: Before going solar, improve your home's energy efficiency. This will reduce your overall energy consumption and potentially allow you to install a smaller, less expensive solar system. Simple steps like sealing air leaks and upgrading appliances can make a difference.
- DIY (if possible and permitted): While professional installation is generally recommended, some homeowners may be able to handle certain tasks themselves (like site preparation). Check your local regulations and be honest about your abilities.
- Ask about rebates and incentives: Many states, cities, and utility companies offer rebates, net metering, and other incentives. Check with your local utility and city/county for any available programs.
- Time your installation: Sometimes, installers offer discounts during slower periods. Inquiring about seasonal promotions might yield savings.
Michigan-specific solar considerations
- Weather Impacts: Michigan's weather is a mix of seasons—with warm, sunny summers and cold, snowy winters. While your solar panels will perform well during the bright summer months, you may see reduced output in winter due to shorter days and snow cover. Designing a system that can handle these seasonal swings is key.
- Regulatory and Legal Considerations: In Michigan, permitting processes are generally clear, though they can differ between municipalities. Be sure to check local building codes and any HOA guidelines if you live in a community with specific rules for solar installations.
Get a custom solar quote in Michigan
Going solar in Michigan can be a financially and environmentally sound decision. By understanding how much it costs and how much you can save, you can make an informed investment and enjoy using clean energy for years to come. Get multiple quotes from reputable installers, compare your options, and take control of your energy.
Go Solar for less than your cell phone bill.