Are Solar Panels Worth It in Montana?

6 factors to consider before getting solar panels in Montana

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

1. Solar panel installation costs

2. Your energy consumption

3. Montana solar incentives

4. How long you stay in your house

5. How you pay

6. The solar company you hire

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

Average solar panel costs in Montana are comparable to the national average. A typical residential solar panel installation costs $18,886 in Montana.

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 Montana, the average cost per watt is only $2.66.

Be aware: The cost of a solar storage battery isn’t typically included in solar quotes, and that sometimes adds $7,000 to $18,000 or more to you total system costs.

Solar panel costs by system size in Montana

2. 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 Montana household needs a system with a capacity of 7.1 kW to offset its electricity needs with solar energy.

You might need a larger or smaller system, depending on your current energy consumption. 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.

3. Montana solar incentives

The 30% federal residential solar tax credit has expired, but Montana still offers a few ways to lower solar costs:

• Property tax break: Up to $20,000 of a residential solar system’s value is exempt from property taxes for 10 years.

• Low-interest loans: Montana offers state financing for qualifying solar and energy-efficiency projects.

• Utility rebates: Some co-op customers may qualify for limited rebates, including YVEC members installing solar-powered livestock watering systems.

What to know about net metering in Montana

Net metering lets Montana homeowners earn credits for extra solar power sent to the grid.

NorthWestern Energy and Montana-Dakota Utilities let credits roll over for up to 12 months, but any unused balance eventually expires. That means it usually makes sense to size your system close to your actual electricity use.

Electric cooperatives may have different rates and rules, so check with your utility before installing solar.

4. How long you plan to stay in your house

It takes years for electric bill savings to make up for the initial cost — about 13.92 years on average in Montana. 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 some of that $30,784 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.

5. How you pay

If you can, it’s often financially strategic to pay for the whole thing upfront. Of course, cash isn’t always an option. That’s when loans, leases and other agreements come into play.

• Loans: Solar loans work like any other type of loan. They have relatively low fixed interest rates. Once you pay it off, you own your system outright.

• 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.

6. The solar company you hire

People have mixed experiences with solar companies. In the best-case scenario, it’s easy, 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.

For instance, Krysten in Eureka was happy at first, but then her system stopped working. She emailed pictures of the problem to the installer, who identified the issue in “technical jargon” that she couldn’t understand.

After forwarding that email to her solar company rep, “They just keep telling me that, ‘No, it looks like your system is working fine’ because the power is on. However, when the power to the grid goes off, then it won't be working fine. I don't know if they don't believe me or they just don't want to think of the problem,” she told us.

Another common complaint is related to pushy sales reps who make promises that can’t be delivered. That’s why it’s so important to thoroughly research and verify claims made by sales teams before making a decision. Project Sunroof is a free solar savings estimator powered by Google Earth imagery.

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 a solar panel installation. Here’s what to think about before you commit:

• How old are my appliances? The first step is to ensure 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.
• How much sunlight do I get? Solar panels need regular exposure to sunlight to produce the most energy possible. Montana averages 4 to 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? Montana (and the rest of the United States) 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 so before you go solar. Otherwise, it could cost thousands to remove the panels, fix your roof and reinstall the panels again.

Pros and cons of solar panels in Montana

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. 

Drawbacks of solar panels in Montana

Going solar can be a complicated process, especially when financing agreements are in place or if you have an older house.

• 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 Montana. That way, you can store energy at home instead of tapping into the local grid when you need to.

• Potential roof leaks: The installation process involves drilling holes into your roof to anchor the panel mounting systems. If not done correctly, this can lead to leaks or structural damage, which will be expensive to fix.

• 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.

Benefits of solar panels in Montana

Generating your own electricity reduces your reliance on the grid while also lowering your carbon footprint.

• 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: Installing solar panels can significantly increase a home's value. According to the study mentioned above, 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 Montana uses quite a bit 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). Solar panels also protect you from future energy cost increases.

» MORE: Solar energy pros and cons

Find solar companies in Montana

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

Montana solar FAQ

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

Going solar in Montana 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: Montana and nearby states