Are solar panels worth it in North Carolina?

7 factors to consider before getting solar panels in North Carolina

ConsumerAffairs has heard from thousands of solar customers who have already gone through the installation process, including dozens from North Carolina. Here’s what to consider before making the switch.

1. Solar panel installation costs
2. Your energy consumption
3. North Carolina solar incentives
4. Net metering buyback rates
5. How long you stay in your house
6. How you pay
7. The solar company you hire

1. Solar panel installation costs: $10,000 to $30,000

Average solar panel costs in North Carolina are comparable with the national average. Before the federal solar investment tax credit (ITC), a typical residential system ranges from $12,800 to $25,600. That price drops to $8,960 to $17,920 after the full 30% tax credit.

On the higher end, Giovanna in Hubert said their system was $45,000, and Sam in Marion spent $73,000.

Average solar installation cost by system size in North Carolina

2. Your current energy consumption

This may be obvious, but you get the most out of solar if most of your appliances are electric. (If you also have an electric vehicle, solar panels will save you even more.) A typical North Carolina household needs a system with a capacity of 10.48 kW to offset its electricity needs with solar energy. You might need a larger or smaller system, depending on your current energy consumption.

Homeowners with solar panels typically save $20,000 to $90,000 over 25 years.

It’s smart to get your electrical loads as low as possible before going solar. That way, you can get a smaller system, which will be cheaper overall. If you have older electrical appliances, upgrade those before investing in solar panels.

Once you know your current electricity consumption, you can calculate your potential savings and the time it should take for your solar installation to pay for itself.

3. North Carolina solar incentives: federal and state

The federal solar investment tax credit (ITC) is the most significant incentive for a lot of homeowners going solar. The ITC provides a 30% tax credit on your total system costs, including equipment, labor and permits. It will drop to 26% in 2033 and 22% in 2034.

Additional solar incentives in North Carolina include state tax breaks, rebates and loan programs.

4. Net metering in North Carolina: changing rate policies

Net metering allows solar panel owners to earn credits for excess electricity. When your panels produce more than you use, the extra power goes to the grid. You get credits to offset future bills. It's like banking electricity for later use.

However, recent updates to net metering policies affect how homeowners benefit from their solar investments. The change aims to encourage more solar adoption but has some uncertainty for future solar panel owners. The new policy potentially means less long-term savings for North Carolina homeowners who go solar.

» GREENEST STATES: North Carolina ranked 14th in 2024

5. How long you plan to stay in your house

It takes years for electric bill savings to make up for the initial cost — about 9.5 years on average in North Carolina. If you sell your house and move before then, you might not fully realize the financial benefits of your solar investment.

A Zillow study found that, on average, houses with solar panels sell for 4.1% more. Let’s say you spend $25,000 putting solar panels on a house that costs $400,000. It might sell for $16,400 more in a few years, according to Zillow. But, you miss out on $62,935 in total avoided utility costs over 25 years.

Solar panels last 25 to 30 years.

In other words, don't get solar panels just because you want to sell your house soon. Consider a home improvement project with a better return on investment, like remodeling the bathroom or kitchen, instead.

6. How you pay

It’s great if you can pay for the whole thing upfront. Of course, cash isn’t always an option.

• Loans: Solar loans work like any other type of loan. In North Carolina, Union Power Cooperative and Randolph Electric Membership Corporation users can get low-interest loans up to $35,000 to pay for home improvements, including solar panels. Piedmont Electric Cooperative has subsidized solar loans up to $15,000.
• Leases: Leasing panels is one way to get the benefits of solar energy without the high upfront cost. A solar lease works like a car lease — you get to use the panels but don’t own them. Leasing can be good if you have limited savings. Solar lease agreements typically last 20 to 25 years.

» SOLAR PANELS: Lease vs. buy

7. The solar company you hire

We’ve heard from dozens of solar customers in North Carolina. A couple of things we know for sure: People like powering their homes with a reliable source of cheap, clean energy. They don’t like getting into solar contracts that don’t meet their expectations.

For instance, Derrek in Spring Lake, who spent $58,000 installing a solar system, said only half his panels are working, and he’s been trying to get them fixed for a year. Meanwhile, he still has to pay $75 to $100 each month for electricity. He sounded frustrated: “You do the math.” Derrek still says that “solar panels are a great idea,” but only if you work with a reputable installer.

That’s why it’s so important to thoroughly research and verify claims made by sales teams before making a decision.

Monthly costs: solar payments vs. savings

Think of going solar in terms of your monthly costs. Given rising energy costs in North Carolina and elsewhere, financing solar panels makes sense as long as your monthly loan payment is less than what you would be paying the utility company anyway.

Is my house a good candidate for solar panels?

Going solar ends up being worth it for many homeowners as long as their house is a good candidate to support the panel installation. Use the National Renewable Energy Laboratory’s PVWatts Calculator to estimate how much electricity a solar panel can produce over a year on your house — just type in your address. Project Sunroof is a free solar savings estimator powered by Google Earth imagery. Here’s what else to think about before you commit:

• How much sunlight do I get? Solar panels need regular exposure to sunlight to produce the most energy possible. North Carolina averages 4 to 4.5 peak sun hours each day. However, lots of shading — like trees or tall buildings above your roof — could make your solar system less efficient.
• What is the size and angle of my roof? North Carolina (and the rest of the U.S.) is in the Northern Hemisphere, so solar panels perform best on south-facing roofs. The worst place to install would be on north-facing roofs, especially if those roofs have a high pitch. For example, if the only place you can install is a north-facing roof with a 30-degree pitch, your costs will likely go up by 30% to 40%.
• What is the condition of my roof? If you have to replace your roof, do that before you install solar panels. Solar panels are designed to last up to 30 years, so you want your roof to last just as long. Otherwise, it could cost thousands to remove the panels, fix your roof and reinstall the panels.

Pros and cons of solar panels in North Carolina

It’s a common misconception that solar panels will completely eliminate your monthly power bill — but this is not always the case. Still, you’ll likely be paying much less than you would for traditional utility bills.

Benefits of solar panels in North Carolina

• Cheaper energy bills: The average homeowner in North Carolina uses a lot of power, which adds up to a lot of savings when you switch to solar. Going solar now means that your monthly energy expenses will be more predictable (and often significantly lower). Solar panels also protect you from future energy cost increases.
• Better for the environment: Traditional energy sources like coal and natural gas release carbon dioxide and other harmful pollutants into the air. Installing solar panels on your roof helps the environment primarily by reducing greenhouse gas emissions and dependence on fossil fuels.
• Higher home resale value: Installing solar panels can significantly increase a home's value. The exact increase in value varies by location, with homes in active solar markets sometimes seeing even higher boosts.

Drawbacks of solar panels in North Carolina

• Solar equipment is expensive: Even with rebates and other financial incentives, the price typically starts between $10,000 and $30,000. It’s even more expensive if you want a solar battery for energy storage. Solar battery costs are generally between $7,000 and $18,000. Getting a solar battery might be strategic if net billing rates continue to decline in North Carolina.
• Potential roof leaks: The installation process involves drilling holes into the roof to anchor the panel mounting systems. If not done correctly, this can lead to leaks or structural damage.
• Energy production varies: Solar panels are dependent on weather conditions and seasonality. Solar panels still work on cloudy days, but less available sunlight does affect how efficiently they produce energy. Snow cover may also temporarily reduce efficiency until it's removed or melts off.

» MORE: Solar energy pros and cons

Find solar companies in North Carolina

A good solar company helps you navigate local incentives, permitting and net metering policies. Compare our picks for North Carolina’s top solar companies to learn more.

Bottom line: Is going solar in North Carolina worth it for you?

Going solar in North Carolina might be easier than you think. The main obstacle to going solar is the high upfront cost of purchasing and installing solar panels, inverters and other equipment. For a lot of homeowners, it ends up being worth it as long as their cost savings over time outweigh the initial investment. Others are happy to go solar for the environmental benefits alone.

Solar costs vs. savings: North Carolina and nearby states