Cost of solar panels in Alaska
How much is it to go solar in 2023?
Before factoring in any financial incentives, the average cost to install solar panels is $14,460 in Alaska. The price drops to $10,122 after the full federal solar investment tax credit (ITC).
Going solar in Alaska is about 39% cheaper than the national average. Not only are your out-of-pocket costs lower than in other states, but systems also generally save residents more over time.
- The average cost per watt is $2.41 in Alaska.
- The average payback period in Alaska is 7 years if you pay for your system in full upfront.
- Alaska residents who go solar receive an estimated average net savings of $34,500 over 25 years.
How much do solar panels cost in Alaska?
Residential solar panels can cost between $10,000 and $30,000. On average, residents of Alaska pay $14,460 for solar panels before using the federal solar investment tax credit for their system.
Your system size factors into how much you pay. With a simple formula, you can see what size is right for you: Find the electricity you used in the last year in kilowatt-hours (kWh). This information is in your electric bill's online dashboard. Then divide your annual kWh by 1,200 to find the necessary system size.
For example, the average home in Alaska used 7,128 kWh last year, which would require a 6-kilowatt (kW) system.
» WATT’S THE DIFFERENCE? kW vs. kWh
Average cost by system size in Alaska
|3 kW||4 kW||5 kW||6 kW||7 kW||8 kW||9 kW|
|Before federal tax credits||$7,230||$9,640||$12,050||$14,460||$16,870||$19,280||$21,690|
|After federal tax credits||$5,061||$6,748||$8,435||$10,122||$11,809||$13,496||$15,183|
|House size||1,300 square feet||1,500 square feet||1,700 square feet||1,900 square feet||2,100 square feet||2,300 square feet||2,500 square feet|
Are solar panels worth it in Alaska?
Alaska is a great place to go solar. Despite the long, dark winters, there’s enough sunlight for solar panels to generate plenty of energy in most of the state. For some, the environmental benefits alone are enough to make going solar worth it in the state.
Seasonal variation is a potential disadvantage of going solar in Alaska. Solar production can vary significantly throughout the year due to the changing seasons. This means you might rely more on the grid or storage batteries during these periods. Solar batteries add to the overall cost of the solar system, potentially doubling the total cost.
Homeowners can still save a lot over time, thanks to the state’s high electricity costs. Plus, going solar lets you generate your own power, which reduces your reliance on the grid. This is particularly attractive in remote parts of the state, where grid access can be limited.
» STILL NOT SURE? Solar energy pros and cons
Cost factors of going solar in Alaska
How much your solar system costs depends on the size of your system, the quality of your panels, the company you choose to go with, permit costs, the condition of your roof and more. Here are some things to consider.
Solar equipment costs
» COMPARE: Most efficient solar panels
Next are the accessories. You most likely need solar batteries to store excess power. These can add an extra $7,000 to $18,000 to your total. Another addition is a monitoring system to track how much power your system creates and alert you to malfunctions. Monitors will set you back another $80 to $400, but some solar panel installers include a monitoring system.
Last but not least, you need a solar inverter to make all that energy usable in your home. Inverters typically cost between $1,000 and $3,000.
Condition of your roof
Your roof can add to the costs of your solar system in more ways than one. You’ll need to get your roof inspected, which is an added cost. If your roof needs to be repaired or replaced, that increases your overall cost of going solar.
Solar panels should last 25 to 30 years, so your roof needs to last just as long. Otherwise, you’ll pay even more money to remove the panels, fix your roof and reinstall them. Avoid the extra costs and frustrations by having your roof ready for solar.
» SHOULD YOU: Replace your roof before going solar?
How you pay
Not sure how to pay for your solar panel system? You've got options, each with its own set of perks and drawbacks.
- Upfront purchase: If you've got the money, you can pay for the whole system upfront. You own it outright and save some money in the long run. Not everyone has that kind of cash lying around, though.
- Solar loans: This is where you borrow the money you need from a lender and pay it back over time. The interest with a solar loan increases your cost, but the savings you get from going solar often make up for it.
- Solar leases: Leasing means you're basically renting the panels from a provider. The upside? Usually you don't have to put any money down. The downside? You won't own the system and won’t be eligible for the federal solar investment tax credit.
- PPAs: In power purchase agreements (PPAs), a company that owns the panels installs them on your property. You agree to buy the electricity the panels generate at a set rate for a specific period. You'll save on your electric bill, but you won't own the panels.
» SOLAR PANELS: Lease vs. buy
Other cost factors
Various other costs can add to the price of your solar energy system:
- Maintenance: There’s not much maintenance for solar panels. You may run into some added costs for potential repair and periodic cleaning, though.
- Permits: Most towns require permits before you can install solar panels. These costs can be low in some towns and reach hundreds of dollars in others.
- Installation and labor: Your solar company will likely add the cost of solar installation and labor into the overall solar system price, but be sure to check before signing a contract.
» GUIDE: Solar panel installation
Solar incentives, tax credits and rebates in Alaska
The federal solar investment tax credit (ITC) will save you the most money when you go solar in Alaska. If you install a solar energy system by the end of 2032, you will get a credit on your federal income taxes equal to 30% of its cost — including equipment, labor and permits. The credit drops to 26% in 2033 and 22% in 2034.
The average federal solar investment tax credit in Alaska is $$4,338 in 2023.
Households that install panels may also get the value exempted from property taxes. How much you save depends on where in Alaska you live; the exemption is determined locally.
» EXPLORE: Alaska solar incentives
Compare solar installation companies in Alaska
Compare popular solar companies available in Alaska below. Read our guide to the best solar companies for more information.
Can I get free solar panels in Alaska?
How are solar costs trending in Alaska?
The cost to go solar in Alaska has fallen 43% over the last 10 years, according to the Solar Energy Industries Association.
How much can I save with solar panels?
When you pay cash, the average 25-year savings with solar is $34,500 in Alaska. That is substantially more than in other states.
How does net metering work in Alaska?
Net metering is when you get compensated for sending excess electricity to the power grid. In Alaska, if you're a customer with a solar system that's 25 kW or smaller, big utility companies have to buy up to 1.5% of their average load from you.
» POTENTIAL ENERGY PRODUCTION: How many kWh does a solar panel produce?
What are the different kinds of solar inverters?
There are two main types of solar inverters. String inverters do what their name sounds like. They “string” together panels and route the electricity to a point where it's converted to the current your home uses. Microinverters are small inverters that are installed on each solar panel, which is a more efficient way to convert energy.
» EXPLORE: What are grid-tied solar systems?
- EcoWatch, “How Much Do Solar Panels Cost in Alaska?” Accessed Sept. 22, 2023.
- Office of Energy Efficiency & Renewable Energy, “Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics.” Accessed Sept. 22, 2023.
- Solar Energy Industries Association, “Solar State By State.” Accessed Sept. 22, 2023.
- Solar Energy Industries Association, “Alaska Solar.” Accessed Sept. 22, 2023.
- DSIRE, “Alaska Programs.” Accessed Sept. 22, 2023.
- U.S. Energy Information Administration, “Electricity.” Accessed Sept. 22, 2023.
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