Is solar worth it in Washington, D.C.?

6 factors to consider before getting solar panels in Washington, D.C.

The long-term savings outweigh the upfront costs for many, but not everyone says they’re saving enough to justify the investment. For instance, Richard in Washington, D.C., said his solar company rep failed to clearly explain the contract, promised goods that were undelivered and withheld a copy of the agreement, ultimately resulting in significantly higher costs than expected. “At this point, I really regret ever getting my panels installed,” Richard told us.

Here are the most important factors to consider before deciding if going solar makes sense for your household.

1. Solar panel installation costs
2. Solar incentives in Washington, D.C.
3. How you pay
4. Your energy consumption
5. How long you live in your house
6. The solar company you hire

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

Solar panel costs in Washington, D.C., are a bit higher than the national average. Before the federal solar investment tax credit (ITC), a typical residential system ranges from $15,300 to $30,600. That price drops to $10,710 to $21,420 after considering the full 30% tax credit.

Most installers set the price according to the system's wattage, with a typical cost between $2.50 and $5 per watt. “Cost per watt” is a little like looking at the price per square foot when you buy a house. It helps you compare the value of solar energy systems in different sizes. In Washington, the average cost per watt is only $3.06.

Average solar panel installation cost by system size in Washington, D.C.

2. Washington solar incentives: Local and federal

The federal solar investment tax credit (ITC) is another major incentive that reduces the upfront cost of going solar in Washington. 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.

The ITC is not a rebate or a refund

Don’t get confused: The ITC is a credit, meaning it directly decreases the amount of taxes you owe. It only offsets your tax liability; you can't take advantage of the ITC if you don’t owe taxes in the first place. However, the credit rolls over to the next tax year if you don’t use the full amount.

You can combine the ITC with local solar incentives in Washington, D.C., including Solar Renewable Energy Credits (SRECs),  to maximize savings. Every time your solar panels generate 1 megawatt-hour (MWh) of electricity, you earn one SREC (1 MWh = 1,000 kilowatt-hours). There’s also a property tax exemption, meaning that your property tax bill won’t go up if solar panels increase the market value of your home.

3. How you pay

If you can, it’s often financially strategic to pay for the whole thing upfront. You own the system from day one, get the tax credit benefits and don’t have to pay interest on a loan. Of course, paying cash is not always an option. That’s when loans, leases and other agreements come into play.

• Local programs: The District of Columbia Sustainable Energy Utility has a no-cost rooftop solar program for income-qualified households. The newly funded Solar for All program is supposed to make solar accessible to 100,000 low- to moderate-income households in the future.
• Solar loans: A solar loan works like any other type of loan. They have relatively low fixed interest rates. Once you pay it off, you own your system outright.
• Lease agreements: 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. However, you won’t be eligible for the federal solar tax credit.

4. Your current energy consumption

Look at your latest utility bills to see how much electricity your house needs each month. This tells you what size and capacity your solar system needs to be. A typical Washington household needs a system with the capacity of 9.3 kW to offset its electricity needs with solar energy. You might need a larger or smaller system, depending on your current energy consumption.

It’s smart to make sure that your electrical loads are as small as possible. If you have an older refrigerator or air conditioning unit, for instance, it’s smart to upgrade those before investing in solar panels. That way, you can get a smaller system, which will be cheaper overall.

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

5. How long you plan to stay in your house

Solar panel installations are expensive, and it takes years for electric bill savings to make up for the initial cost. Solar panels typically pay for themselves within 7 years in Washington. If you sell your house and move before then, you might not fully realize the financial benefits of your solar investment.

Solar panels typically pay for themselves within 5 to 10 years.

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 some of that $63,114 in total avoided utility costs over 25 years.

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

6. The solar company you hire

People have mixed experiences with solar companies. In the best-case scenario, it’s easy to make the switch, and you’re happy with the system’s performance. In the worst-case scenario, you end up paying thousands for mid-tier solar equipment from a company with poor customer service and no follow-up or support.

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

Monthly costs: Solar payments vs. savings

Think of going solar in terms of your monthly costs. Given rising energy costs in Washington 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.

Pros and cons of solar panels in Washington, D.C.

It’s a common misconception that solar panels always completely eliminate your monthly power bill — 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 Washington, D.C.,

Solar power is a renewable energy source that does not produce greenhouse gas emissions or other pollutants. They also require little maintenance and can increase the property value of homes.

• Better for the environment: Traditional energy sources like coal and natural gas release carbon dioxide and other harmful pollutants into the air. Solar panels generate electricity from sunlight, a clean and renewable energy source. Installing solar panels on your roof helps the environment primarily by reducing greenhouse gas emissions and dependence on fossil fuels.
• Higher home resale value: Houses with solar panels sell for 4.1% more on average. The exact increase in value varies by location, with homes in active solar markets sometimes seeing even higher boosts.
• Cheaper energy bills: The average homeowner in Washington 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 very often significantly lower). It also protects you from future energy cost increases.

Drawbacks of solar panels in Washington, D.C.

The main obstacle to going solar is the high upfront cost of purchasing and installing solar panels, inverters and other equipment. Then, since solar panels do not generate electricity at night, you need to pull power from the grid or get a storage battery to keep your lights on.

• 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 Washington. That way, you can store energy at home instead of tapping into the local grid when you need to.
• 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.
• Potential roof problems: 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.

» MORE: Solar energy pros and cons

Find solar companies in Washington, D.C.

A good solar company helps you navigate local incentives, permitting and net metering policies. Compare our picks for the top solar companies in Washington, D.C. to learn more.

Bottom line: Is going solar in Washington, D.C. worth it for you?

For a lot of homeowners, solar panels are 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. Several factors determine if solar panels are worth it for you, including initial installation costs, the orientation and shading of your roof and how long you plan to stay in your home.

Solar costs vs. savings: Washington, D.C., vs. nearby states

» EXPLORE: Solar energy facts and statistics