So What is the cost of solar panels in Washington state?

When it comes to solar, last year’s facts are this year’s fiction. The solar industry changes at a rapid pace, leaving prospective solar buyers reading old news when trying to make a decision. This can often get in the way of homeowners making well-informed choices about their solar energy needs.

Despite the cloudy weather, solar power is increasingly becoming more popular with homeowners in the Washington. These homeowners are becoming more environmentally friendly while saving money on their utility bills, locking in their electricity rates, and increasing their property values.

To ensure you get the best possible solar education, we’re going to look at the primary reasons to switch to solar in Washington, and break down the average cost of a standard solar system after incentives

The Cost Of Electricity Has Increased by 20%

In Washington, the average cost of a single kilowatt hour of power is about 9.6 cents. In 2010, the average cost of a single kilowatt hour of power was about 8 cents. Retail electricity rates have risen across the state by 20% over the last 10 years. The trend of utility companies continuing to raise electricity rates is unlikely to change in the near future.

The Cost Of Solar Has Dropped By More Than 55%

An averaged-sized residential system has dropped from a pre-incentive price of $40,000 in 2010 to about $18,000 today. This is one of the primary reasons why more and more Washingtonians are choosing to go solar.

Solar Boosts Property Resale Value

Solar panels don’t just reduce your energy costs and help the environment; they also increase your property value. According to Zillow, homes with solar sold for nearly 3% more than comparable homes without. That means an average home with solar across the United States sold for an additional $9,274.

Zillow’s findings reflect similar studies published by the Lawrence Berkeley National Renewable Energy Laboratory, which drew on a sample of 23,000 homes across the country.

Understanding Property Resale Value

Your property value will increase by an average of 3% the moment you go solar. For instance, if your property value was $400,000 before installing solar, it will be worth $412,000 after installing it.

What About The Clouds?

Germany leads the world in solar power production, yet it’s slightly cloudier than places like Vancouver, Olympia, and Seattle on an annual basis. Much like Germany, Washington benefits from long summer days with mild temperatures — ideal conditions for maximum solar production. This helps balance out lower production in the cloudy winter months.

When you go solar, you take advantage of Net Energy Metering. During the summer months, your solar system will produce more energy than you consume. The excess energy will be sent back into the grid. Think of it as a sort of “energy storage bank.” During cloudy months, when your solar isn’t producing as much energy as you’re consuming, Net Energy Metering will automatically distribute the excess energy you stored away over the summer.

Solar Incentives

Washington State Solar Tax Exemption

As of July 1st, 2019, all solar systems smaller than 100 kilowatts are exempt from state and local use tax. This tax exemption helps Washingtonians save thousands when installing solar panels on their property. For a standard-sized solar system, this will save Washington property owners $1,500+ on the overall cost of going solar.

Federal Solar Investment Tax Incentive (ITC)

The federal government incentivizes you to purchase solar by reducing the barriers to entry. This incentive lowers your federal tax obligations on a dollar-to-dollar basis, through a cash rebate. There is no ceiling on the tax credit. The Federal Solar Investment Tax Incentive is worth 30% of the total purchase price of your solar system, regardless of the system size or cost.

How To Break Down A Solar Purchase

The overall cost for solar panels in Washington range between $3,000 and $4,000 per kilowatt. When it comes to your specific solar price, the size of your solar system and your property’s unique installation conditions will be the determining factors. While installation costs can vary, the average installed cost of solar in Washington is $3,300 per kilowatt. The average size of a solar system in Washington is about 5 kilowatts, and the average sales tax rate in Washington is 8.6%.

Average Pre-Incentive System Cost in Washington

Average System Size in Washington: 5 Kilowatts

Average System Cost Per Kilowatt in Washington: $3,300


Average Sales Tax in Washington: 8.6%

5 Kilowatts in Size x $3,300 Per Kilowatt = $16,500 Pre-Tax Cost

$16,500 Pre-Tax Cost x .086 Sales Tax Rate = $1,419 Sales Tax

$16,500 Pre-Tax Cost + $1,419 Sales Tax = $17,919

Average Pre-Incentive Solar System Cost in WA: $17,919

Calculating Average Washington Solar Incentives

Using the average pre-incentive system cost of $17,919, let’s calculate how Washington and federal cash incentives will further reduce the cost.

Washington State Solar Tax Exemption

The State of Washington will waive all of your sales tax.

Average Solar Sales Tax Exemption in Washington: $1,419


The federal government will provide a cash incentive of 30% of your total system cost.


$16,500 System Cost W/O Sales Tax x 30% = $4,950 Incentive


Average Federal Solar Incentive in Washington: $4,950

Calculating the Average Cost of Solar in Washington

Average Pre-Incentive System Cost In Washington: $17,919


Average Solar Sales Tax Exemption in Washington: $1,419


Average Federal Government Incentive in Washington: $4,950


$17,919 Pre-Incentive Cost – ($4,950 Federal Incentive + $1,419 Tax Exemption) = $11,550


Average Post-Incentive System Cost in Washington: $11,550

Solar Purchase Options

Think of purchasing solar like buying or renting a home. You can own it outright by paying cash up front, you can finance it and pay little to nothing up front, or you can choose to rent (lease).

At Smart Solar Energy, we don’t believe in leasing (renting) our solar systems. You have to split the savings with your solar company, you don’t get to take advantage of the federal and state solar incentives, and selling your property can be a challenge. If you’ve ever heard of someone with solar who struggled to sell their home, they were probably leasing their system.
Much like owning a home, owning your solar system allows you to maximize your investment benefits. While paying everything up front is the best way to purchase solar, most people would prefer to hold on to their hard-earned cash. We have a variety of financing options with local credit unions and can work to find you a solution that meets your specific needs.

Does Solar Make Sense For You?

We believe in educating our prospective clients so you can make well-informed decisions about your solar energy needs. Our Free SolarAudit will help you understand whether your property is a good candidate for solar. From there, we can make recommendations based on the incentives available to you and develop a unique plan that addresses your solar energy needs. 

How Much is a Solar System for a 1,500-Square-Foot Home in Washington?

The cost of integrating a solar system for a 1,500-square-foot home in Washington is contingent upon various factors, including energy needs and property specifications. Smaller homes generally consume less electricity, but individual consumption is influenced by numerous elements. For instance, a 5 kW solar panel system in Washington State costs around $15,000, prior to factoring in the federal solar tax credit.

Applying the Solar Tax Credit

Applying the solar tax credit can significantly reduce the net cost of your solar system by 30%. Consult with a tax professional to ensure eligibility.


$15,000 x 30% = $4,500

Has the Cost of Solar Panels Decreased?

The cost of residential solar systems experienced a substantial drop, stabilizing in 2017. Despite a 40% decrease in the past decade, the most significant reductions occurred earlier due to technological advancements, heightened competition in the solar industry, and manufacturing economies of scale.

How Much Do Solar Panels Cost?

Solar panel prices fluctuate based on factors like durability, efficiency, power output, and warranties. For example, a 100-watt solar panel can be acquired online for less than $100, but a 400-watt panel may cost double or triple that amount. Premium solar panels with enhanced durability and extended warranties are used at Smart Solar Energy.


The total cost of solar panels is just one component of the entire solar system cost, encompassing labor, a solar inverter, mounting equipment, and other components.

Cost of Solar Panels by Type

Three commonly used types of solar panels in residential installations in Washington are:

Monocrystalline Solar Panels

Offering high-efficiency solar cells, monocrystalline panels are space-efficient and have a longer lifespan. Despite a higher upfront cost, they produce more solar power per square foot.

Polycrystalline Solar Panels

More cost-effective to produce, polycrystalline panels are budget-friendly but generally less efficient and have a shorter lifespan compared to monocrystalline panels.

Thin-Film Solar Panels

With a lower cost, lightweight and flexible thin-film panels are effective in low-light conditions but are generally less efficient overall and have a shorter lifespan of ten to twenty years.


Now is an Excellent Time to Go Solar

The cost of solar panel systems has significantly decreased, making it an affordable option for many homeowners. The precise cost depends on individual property and energy usage. For an accurate assessment, contact Smart Solar Energy for a free solar audit, analyzing the solar potential of your property and providing a customized solar system proposal, backed by a 25-year warranty.