Off-the-Grid Solar System Cost

An off-grid solar system is an autonomous power system that operates independently of the electric grid. On-grid systems rely on power from utility companies. Off-the-grid solar systems require a higher upfront investment as they typically involve purchasing additional equipment, such as batteries and generators, to store excess energy for later use. The average cost of a small to medium-sized off-the-grid solar system can range from $20,000 to $100,000. However, the exact price can vary.

Highlights & Key Takeaways

• Off-grid solar systems are generally more expensive than on-grid systems, ranging from $20,000 to $100,000, because they require additional components like batteries for energy storage.
• The cost of an off-grid solar system depends on factors such as the size of the system, location, and energy needs.
• DIY installation may lower the upfront cost of an off-grid solar system, but hiring a professional is recommended to ensure safety and optimal performance.
• Rebates, incentives, and tax credits of 26% or more can help reduce the cost of an off-grid solar system, so it's essential to research and take advantage of available programs.

How Much Does an Off-Grid Solar System Cost?

As stated, the cost of an off-the-grid solar system can vary and largely depends on several factors, such as the location of your house and the daily electricity consumption. The full off-grid solar system cost can vary from $20,000 to $100,000, excluding tax credits and rebates. Typically, a standard household utilizes at least 7kW of electricity daily, requiring around six panels and three batteries to fulfill the energy requirements. 

However, most homeowners spend around $55,000 to install a 7kW off-grid solar system, which can meet the average energy needs of a moderately sunny climate. Homes in sunny climates with backup systems could be as low as $20,000 for their off-the-grid system, whereas homes with moderate sun exposure and excessive energy demands could be closer to $100,000 for an installed 20kW solar system.

Off-Grid Solar System Cost by Type

Not all solar systems are created equal and may require different components to function correctly. A system that works well for a small home in a sunny area may not suffice for a larger house in a more shaded location. Hence, multiple systems can be used to achieve an off-grid solar setup. Generally, AC solar or AC systems with a backup generator are popular among homeowners to ensure an uninterrupted power supply, even during bad weather. However, if you have lower energy requirements, you can opt for smaller, more affordable systems that utilize wind power or fewer batteries. 

Let’s explore the estimated costs for different off-grid solar systems.

DC Solar System

DC solar systems operate on direct current power. These systems are relatively affordable, with installed costs ranging from $6,600 to $11,000. Typically, traditional solar systems are DC or direct current systems that do not require inverters or batteries, supplying electricity directly to the house. However, DC-only solar systems may not best-fit households with significant electricity needs, as they can only power a few small appliances and lights. 

AC Solar System

An AC solar system uses an inverter to convert the direct current (DC) power produced by solar panels into alternating current (AC) power that can be used to power household appliances and electronics. Depending on the system's size, these systems typically cost between $30,000 to $60,000. 

Mixed DC and AC Solar Systems

A mixed DC and AC solar system is a type of solar energy system that combines both direct current (DC) and alternating current (AC) power to meet the electricity needs of your home. These systems tend to require fewer solar panels than a complete AC solar system but can still provide the ability to power more energy-intensive appliances. In a mixed DC and AC solar system, batteries store the DC power produced by solar panels, which is then converted to AC power using an inverter. Homeowners can expect to pay between $11,000 to $55,000 on average. 

AC System with Wind

An AC solar system uses solar panels and wind turbines to generate electricity. The system consists of a combination of solar panels, wind turbines, batteries, and inverters. During the daytime, when there is sunlight, the solar panels generate electricity, and any excess energy is stored in batteries. At night or when there is not enough sunlight, the batteries can be used to power the home. Similarly, the batteries can provide power when there is not enough wind. 

Depending on the size of the system, it can cost between $22,000 to $90,000 for an installed system. This system combines solar panels, wind turbines, batteries, and inverters to generate electricity. 

AC System with Back-Up Generator

An AC system with a backup generator is a typical setup for homes that use solar power off-grid. The system is designed to handle the entire home load, but a backup generator is needed in case of a prolonged period of little to no sun. An installed system with this setup ranges from $44,000 to $80,000. 

The backup generator is crucial when there is not enough sunlight for the system to store energy for several days. While generators are not usually enough to power a home continuously because propane is expensive, they can help eliminate potential downtime with your electrical needs as a backup system.

Off-Grid Solar System Cost by Component

Achieving complete off-grid living requires more than just installing solar panels. Solar panels alone cannot provide electricity during cloudy days or at night, hence the need for additional components to support the system. The most common off-grid system uses solar panels, batteries, inverters, and solar charge controllers for each battery. However, incorporating alternative energy sources like generators or wind power adds extra costs. Here is a breakdown of the components needed for your off-the-grid solar system and how much those items typically cost.

Solar Panels

Though it can vary, most homes require between 17 and 21 solar panels, and costs after credits can range from $16,870 to $23,170. This is where most of the costs come in for your solar energy system. Just remember the number of panels you need may be higher or lower than the average. And the type of panels you choose, monocrystalline or polycrystalline, can also impact your price.

Solar Charge Controller

The solar charge controller is what charges your batteries. Since the batteries can’t handle the energy independently, the controller is needed to convert the energy into a storable form. The number of batteries you need can vary, but typically, you’ll need between two and eight, which means you’ll also need between two and eight controllers to operate them. Solar charge controllers typically cost between $550 and $600 each.

Solar Battery Bank

A solar battery bank is a collection of batteries that store excess solar energy generated by solar panels for later use when the sun is not shining. They are also commonly referred to as solar battery storage systems. The cost of a solar battery bank depends on its size, typically ranging from $5,000 to $15,000.

Inverter

Inverters convert your solar energy into electricity. However, the number of inverters you need, not to mention the size and type, will depend on the number of panels, batteries, and energy you need to generate. The typical off-grid solar invert price is between $7,000 and $8,000, but as with any solar component, costs can vary.

Mounting and Wiring

The mounting and wiring for your off-the-grid solar system make up the labor costs associated with installing everything. All in all, the labor costs only represent a small percentage, up to 25%, of the total cost of your off-the-grid system. For a $50,000 solar energy system, the labor portion could be as low as $5,000, but it is best to budget closer to $12,500. Most companies roll the labor cost into the system’s cost rather than pricing it separately. For this reason, you are unlikely to get separate material and labor charges for the mounting and wiring when installing a new system.

Alternative Energy Source

The price of an alternative energy source can fall between $2,000 to $20,000 or more, depending on the type of system. It's crucial to have a backup energy source in case of prolonged periods of insufficient sunlight or other issues that may cause your primary system to fail. Options for backup energy sources include hydro or wind turbines which cost $6,000 to $11,000, or propane-powered backup generators, which cost around $10,000 to $20,000.

Off-Grid Solar System Cost by Size

Off-grid solar systems can be a great way to power your home or cabin without relying on traditional power sources. As we shared earlier, the average cost of a small to medium-sized off-the-grid solar system can range from $20,000 to $100,000. However, the cost can vary depending on system size, components, and location. Let’s break down the cost of off-grid solar systems by kW size to give you a better idea of what to expect when considering this type of system.

Average Cost of 3 kW Off-Grid Solar System 

According to LawnStarter, a 3 kW off-grid solar system can cost between $10,000 and $15,000. This includes the cost of solar panels, batteries, an inverter, charge controllers, and installation. Remember, however, that the price can vary based on the type and quality of equipment used.

Average Cost of 5 kW Off-Grid Solar System 

The average cost of a 5 kW off-grid solar system is between $25,000 and $50,000. This cost includes the solar panels, battery bank, charge controller, and inverter. A home might require a 5 kW system if it has higher energy demands or more appliances and devices that require electricity than a home that only requires a 3 kW system.

Average Cost of 10 kW Off-Grid Solar System 

LawnStarter indicates a 10 kW off-grid solar system is around $30,000 to $60,000. This system size suits larger homes or small commercial properties with high energy demands. A 10 kW system can handle the energy needs of a large home or a small business, including appliances, lighting, and HVAC systems.

Average Cost of 15 kW Off-Grid Solar System 

The average cost of a 15 kW off-grid solar system is around $50,000 to $60,000. A 15 kW system is suitable for larger homes, farms, or commercial properties with higher energy needs. These properties might have multiple appliances, heavy machinery, or large HVAC systems that require significant power, making a 15 kW system a better fit for their energy demands than a smaller one.

Average Cost of 20 kW Off-Grid Solar System 

A 20 kW off-grid solar system typically costs around $60,000 to $80,000. A 20 kW system is much larger than a 3 or 5 kW system and is typically used for larger homes or businesses with high energy demands. It may require more solar panels, batteries, and other components to handle the increased load, which results in a higher overall cost.

Other Factors that Affect Off-Grid Solar System Cost

While the size of an off-grid solar panel system plays a significant role in the overall cost, other factors, such as the system's efficiency, the number of panels required, and the tax incentives and credits available, can also impact the total cost. Additionally, the amount of sun exposure your location receives, and the type and quality of the individual components used can all play a role in determining the final cost of an off-grid solar system.

Efficiency of Solar System

The efficiency of an off-grid solar energy system is a critical factor that can impact its overall cost. More efficient solar panels and other system components are more expensive than less efficient ones. However, the increased cost of these components can be offset by savings on electricity bills in the long run. A more efficient system may require fewer solar panels, reducing installation costs. Therefore, it's important to consider efficiency when designing an off-grid solar energy system to find the right balance between cost and performance.

Solar System Manufacturer

Choosing the appropriate solar panel manufacturer is crucial in determining the cost of your off-the-grid solar system. Each manufacturer offers various levels of efficiency and quality, which can impact the panel's price and installation costs. Premium manufacturers like SunPower or LG may charge more, but their higher-quality panels can result in long-term savings through enhanced durability and efficiency. Hence, it's essential to consider the manufacturer's quality and efficiency when selecting the components of your off-the-grid solar energy system.

Solar Panel Material

Two primary types of solar panels are monocrystalline and polycrystalline. The main difference between the two is the level of crystal purity in their cells. Monocrystalline panels are made from a single silicon crystal, resulting in higher crystalline purity, while polycrystalline panels are made from multiple silicon fragments melted together. Mono panels tend to be more efficient but expensive due to their manufacturing process, while poly panels are less efficient but more affordable. 

Number of Panels Needed

As a rule of thumb, most homes require between 17 and 21 solar panels. And the number of panels you need will significantly impact the cost of your off-the-grid solar energy system. Larger systems with more panels will cost more than smaller systems with fewer panels. However, the cost per watt decreases as the system size increases, similar to buying in bulk. Keep in mind, too, that while larger systems may require more upfront costs, they also have the potential to save you more money in the long run by offsetting your electricity bill. Financing options such as solar panel loans make investing in a more extensive system that maximizes your solar savings easier.

Tax Credits & Incentives

Federal tax credits can significantly reduce the cost of installing solar energy systems for homeowners. The federal government offers a solar investment tax credit (ITC) that allows homeowners to deduct up to 26% of the cost of their solar panel system from their federal taxes. This tax credit applies to residential and commercial systems, and there is no cap on the amount that can be claimed. 

Labor Costs to Install

While labor costs can vary, Sinovoltaics indicates that installing a 5kW solar energy system, consisting of 15 to 25 panels, typically costs around $30,000. The labor cost for installation averages $0.59 per Watt, accounting for about 10% of the total system cost (though be prepared to pay up to 25%). Therefore, installing a 5kW solar energy system would require at least $3,000 in labor charges, which includes electrician installation and non-electrician labor costs. 

Geographical Location

The cost of your solar system is also impacted by factors such as climate and sunlight availability. In areas with high levels of sunshine, solar energy systems are more efficient and can produce more electricity, leading to a lower overall cost. In contrast, areas with less sunlight require more solar panels to generate the same amount of electricity, increasing the installation cost. Additionally, harsh weather conditions such as snow, hail, and high winds can damage solar panels, increasing maintenance and repair costs. 

Amount of Sun Exposure

The amount of sunlight, climate, and season can impact the effectiveness of your solar panels. Areas with abundant sunshine throughout the year, like Arizona, California, and Florida, are great for solar panel installations as they can produce more power. However, states like Washington and Oregon with lower sun exposure may experience lower efficiency from their solar panels.

Maintenance of Solar System

Solar panels require very little maintenance. Nevertheless, having a solar professional inspect and clean them annually is essential. While we recommend hiring a professional, if you prefer a DIY route, know that you should avoid using a pressure washer, regardless of the roofing material. Instead, opt for a gentle, low-pressure spray and a commercial detergent made for roofs. This method can effectively remove dirt and debris, improving energy efficiency while also preserving the integrity of the solar panels or shingles and avoiding any potential damage that high-pressure washing may cause.

How to Estimate the Cost of an Off-Grid Solar System for Your Home

These steps can assist you in comprehending the typical expenses associated with solar panel installation if you sincerely contemplate using solar panels.

• Determine your energy needs. assess your household's energy consumption by reviewing your monthly electricity bills and determining how many kilowatt-hours (kWh) of electricity you use on average.
• Calculate the size of your solar panel system. After determining your monthly energy usage, you can estimate the size of the solar panel system required. Typically, a residential solar panel system is approximately 6 kW, producing approximately 7,500 kWh of electricity annually.
• Determine the cost per watt. You can estimate the total cost of your solar panel system by multiplying the size of your system by the cost per watt, which usually ranges from $3 to $5 per watt.
• Check for available incentives. Check with your local utility company or state energy office to discover any available incentives or rebates for solar panel installation. Additionally, remember that the federal solar tax credit currently offers a 26% credit towards the system's cost, while many states and local governments provide supplementary incentives.
• Get quotes from multiple installers. You should not simply settle with the first installer you meet with. Obtain quotes from multiple solar panel installers to get the best price on your off-grid solar system. Compare the cost per watt, the quality of the equipment, and the warranty each installer offers.

Off-Grid vs. On-Grid Solar Systems

When considering solar power for your home, you may hear the terms "off-grid" and "on-grid." Understanding the differences between these systems is essential in determining which one is right for your needs.

What’s the Difference between Off-Grid vs. On-Grid Solar Systems?

Off-grid and on-grid solar systems are two types of solar energy systems with different characteristics and applications. On-grid solar systems are connected to the utility grid, meaning they can draw electricity from it when needed and send excess power back to it. These systems usually do not require battery storage since they rely on the grid for power when solar production is low. 

In contrast, off-grid solar systems are independent of the utility grid and require battery storage to store energy generated by solar panels. These systems are typically used in remote areas where the grid connection is not feasible or expensive. While on-grid systems are more common and cost-effective, off-grid systems offer more independence and resilience in case of power outages.

Pros and Cons of Off-Grid vs. On-Grid Solar Systems 

Off-grid and on-grid solar systems each have their own set of advantages and disadvantages. 

Off-grid solar system pros

• Complete energy independence
• No monthly electricity bills
• Provides electricity in remote areas where the grid connection is not possible or too expensive

Off-grid solar system cons

• Initial installation costs are higher due to the need for batteries for energy storage
• Limited electricity supply during cloudy days or periods of low sun exposure
• Requires regular maintenance and monitoring of battery levels

On-grid solar system pros

• Potentially lower installation costs, as no batteries are required
• Ability to sell excess electricity back to the grid through net metering
• No concerns about limited electricity supply during cloudy days or low sun exposure

On-grid solar system cons 

• No electricity supply during power outages or grid failures
• Monthly electricity bills are still required, as energy consumption may exceed production
• Limited availability in remote areas with no access to the grid

Which is More Expensive: Off Grid or On Grid Solar Systems?

Off-grid solar systems are typically more expensive than on-grid solar systems because they require a battery bank to store excess energy. This is because off-grid systems are not connected to the utility grid and thus cannot draw electricity from it when needed. As a result, off-grid systems must have enough battery capacity to power the home during periods of low sunlight, such as during cloudy weather or at night. These batteries can significantly impact the cost of the overall system, making off-grid systems more expensive upfront than on-grid systems. 

On the other hand, on-grid systems do not require batteries and are typically connected to the utility grid, which means they can draw electricity from it when needed. This can make them more cost-effective than off-grid systems in the long run, as homeowners can avoid the upfront cost of expensive batteries.

Is an Off-Grid Solar System Worth the Cost?

Whether or not an off-grid solar system is worth the cost depends on the cost of utility electricity, the availability of rebates and incentives, and the location and energy needs of the home. In some cases, installing an off-grid system can be more expensive than staying connected to the grid. Still, an off-grid system may be more cost-effective and reliable in remote areas with high electricity costs. 

Off-grid solar systems have advantages and disadvantages, and whether they are the best choice for your home depends on various factors. Here are some pros and cons to consider:

Pros:

• Independence - With an off-grid system, you're not reliant on the utility company for your power. You can live in remote locations or areas where grid power is unreliable or unavailable.
• Environmental benefits - Off-grid systems reduce reliance on fossil fuels and can be a more sustainable option for generating electricity.
• Energy security - In a power outage or natural disaster, you can still have electricity to power your home.

Cons:

• Higher upfront costs - Off-grid systems can be more expensive to install and require battery storage, which can increase the overall cost of the system.
• Maintenance - These systems require regular maintenance, such as cleaning solar panels and battery maintenance, which can be time-consuming and expensive since hiring a professional is recommended.
• Limited power supply - Off-grid systems have a limited power supply, which means you may need to limit your power usage or invest in a larger system, which can be more expensive.

Ways to Finance an Off-Grid Solar System

Considering that the average cost of a small to medium-sized off-the-grid solar system can range from $20,000 to $100,000, the chances are that you don’t have the cash on hand to fund an off-grid solar system project. Solar panel personal loans can be obtained from various lenders, including LightStream, Credible, SoFi, BestEgg, Upgrade, and more. When choosing a solar loan provider, it's essential to consider the following:

• Interest rates - The interest rate you qualify for depends on your credit score, creditworthiness, loan amount, and loan term. Compare rates from different lenders to find the best offer.
• Loan terms - Solar panel loans are typically offered with terms ranging from 2 to 20 years. Choose a loan term that fits your budget and financial goals.
• Fees - Some lenders may charge origination fees or prepayment penalties. Make sure you understand all the fees associated with the loan before signing up.
• Reputation - Check the lender's reputation and customer reviews to ensure they have a track record of providing quality service.
• Customer support - Look for a lender that provides good customer support, so you can get help if you have any questions or issues during the loan process.

Final Word

The cost of off-grid solar systems can be significant upfront, but they can provide energy independence and cost savings in the long run. When considering off-grid solar systems, consider the cost of controllers, inverters, a battery bank, and maintenance. Ultimately, the decision between off-grid and on-grid solar systems depends on individual circumstances and priorities.