Cost of solar panels in Minnesota

How much is it to go solar in 2024?

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large house with sunroom and solar panels in winter

Before the federal solar investment tax credit (ITC), the average cost to install residential solar panels is $22,720 in Minnesota. The price drops to $15,904 after the full ITC, which is quite a bit cheaper than in many other states.


Key insights

  • The average cost per watt is $3.29 in Minnesota.
  • When you pay upfront, it takes solar panels an average of 12 years to pay for themselves in Minnesota.
  • Minnesota homeowners with solar panels get estimated net savings of $17,546 over 25 years.

How much do solar panels cost in Minnesota?

Installing residential solar panels can cost between $10,000 to $30,000 or more, though individual costs vary. On average, residents of Minnesota pay $22,720 before tax credits for their system.

Your system's size can be a big factor in how much you pay overall. Not surprisingly, the smaller your system, the less you pay. The average size of a solar system in Minnesota is 8 kW.

Average solar panel cost by system size in Minnesota

Source: EcoWatch

Are solar panels worth it in Minnesota?

As energy costs continue to rise and climate change becomes a more serious problem, many homeowners are considering installing solar panels. But whether going solar is worth it depends on your current energy usage and the solar company you hire.

One solar customer we talked to, Greg in Cottage Grove, ran into some headaches with his local utility company when hooking up his system, but he still says it was the right choice.

“If it wasn’t for dealing with those pesky power company people, this experience would have been well above what I expected,” he said. “To say it was a long process of waiting for them would be quite an understatement.”

Solar panels typically last 25 years.

Working with your utility on net metering agreements and permissions can extend the solar panel installation timeline. This bureaucratic red tape seems to have been Greg’s biggest frustration, not the solar panels themselves.

Eric in Eden Prairie, on the other hand, had a seamless setup process and has seen great value from his solar panel system, especially with the addition of a battery: “It's such a great experience to have Powerwall installed and activated with our solar panels.” Eric uses the same app to manage his electric cars and visualize energy production versus consumption.

The ability to store solar energy in a battery for use when the sun isn’t shining, like at night or on cloudy days, increases the year-round benefits for Minnesota solar panel owners.

If it wasn’t for dealing with those pesky power company people, this experience would have been well above what I expected.”
— Greg in Cottage Grove

For Eric and a growing number of Minnesota homeowners, solar power brings ecological and economic wins that outweigh the growing pains.

Whether buying a solar energy system is worth it for you depends on your tolerance for initial logistical hassles, your ability to integrate battery storage and the long-term financial payoff calculations. Government tax credits and rebates, ever-improving technology and dropping panel prices make going solar a smart bet for most.

» STILL NOT SURE? Solar pros and cons

Cost factors of going solar in Minnesota

In Minnesota, as in other states, your solar system cost varies depending on the equipment you choose and the power output of your system. Higher quality panels, optional equipment, permits and more will raise costs.

Solar equipment costs

Equipment prices vary due to the quality of the equipment and the company you buy it from. Solar panels are typically priced per watt. In Minnesota, the average cost per watt is $3.29. Here are some average costs you can expect for other equipment:

» COMPARE: Most efficient solar panels

Size of your system

You can determine what size system you need with some quick math. First, find out the amount of electricity you used in the last year in kilowatt-hours (kWh). You’ll find this information through your electric bill’s online account dashboard.

Divide your annual kWh by 1,200 to find the system size you need. For example, the typical Minnesota household uses 9,312 kWh per year. Using this formula, the typical household would need an 8-kW system.

» WATT’S THE DIFFERENCE? Kilowatt vs. kilowatt-hour

Condition of your roof

Quality solar panels should last 25 to 30 years, so you need your roof to last just as long. Otherwise, you’ll have to pay to remove the panels, fix your roof and reinstall them again. This is a frustrating and expensive process. Be sure to have your roof inspected and repaired before getting solar.

» SHOULD YOU: Replace your roof before going solar?

Other cost factors

That’s not all. There are various other costs to watch out for:

  • Maintenance: Though solar panels require minimal maintenance, you may run into some added costs for potential repair or replacement of components and periodic cleaning.
  • Permits: Most towns also require solar permits, which can add to your system's overall cost.
  • Installation and labor: Most companies fold the solar installation and labor cost into the solar system price but check before signing a contract.

» TIPS: How to get the best solar quotes

Solar incentives, tax credits and rebates in Minnesota

The federal solar investment tax credit (ITC) is the biggest factor in reducing the cost of going solar in Minnesota. If you install a residential solar panel system by the end of 2032, you will receive a federal income tax credit equal to 30% of the system's total 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 Minnesota is $6,816 in 2023.

Minnesota also offers many local solar incentives to lower the price of going solar even more. You can take advantage of tax exemptions, rebates and low-interest loans.

» EXPLORE: Minnesota solar incentives

Compare solar installation companies in Minnesota

Compare popular solar companies available in Minnesota below. Read our guide to finding the best solar companies for more.

Do you own or rent?

FAQ

Can I get free solar panels in Minnesota?

There are no programs for free solar panels in Minnesota we could find. You can lease solar panels or enter a power purchase agreement with minimal or no upfront costs, but neither is totally free. Solar leases generally require a flat monthly fee; PPAs make you pay per unit of electricity.

» FREE SOLAR PANELS: Are they really free?

How are solar costs trending in Minnesota?

The cost to go solar in Minnesota has fallen 43% over the last 10 years, according to the Solar Energy Industries Association.

How can I pay for solar panels?

You can pay cash, but most people finance solar panels. A solar loan works a lot like any other type of loan — there’s an application and approval process, and you pay it back over time (with interest).

If you are considering a solar loan, lease or PPA (power purchase agreement), always ask:

  • Is there a down payment?
  • How much will I pay per month?
  • When will monthly payments increase, and by how much?

» SOLAR PANELS: Lease vs. buy

How much can I save with solar panels?

When you pay cash, the average 25-year savings with solar is $17,546 in Minnesota. It’s a common misconception that solar panels always completely eliminate your monthly power bill, but this isn’t always the case.

On the bright side, people who still have a bill after going solar are paying significantly less than before. You can expect to offset your electricity bill by 80% to 108%, according to EnergySage.

» EXPLORE: Where solar savings go the furthest

How does net metering work in Minnesota?

If your solar system generates more electricity than your home needs, you can sell it to your local electricity company. This process is known as net metering. In Minnesota, you can get paid through a check or receive credits on your electricity bill.

Will hail damage my solar panels?

Hail can damage solar panels, but you shouldn’t let that deter you from installing them. Most panels can withstand small hail. Also, your homeowners insurance might cover the cost to fix any damage caused by hail.

Bottom line

With cheaper solar and plenty of solar incentives to lower costs even more, going green is easier for Minnesotans. Over 25 years, residents can save, on average, around $17,546 with their solar.

Solar costs: Minnesota vs. nearby states

*Before the federal investment tax credit (ITC); **When you pay in full upfront

Article sources

ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:

  1. EcoWatch, “Solar Panel Cost in Minnesota.” Accessed Dec. 24, 2023.
  2. EnergySage, “Minnesota solar panels: local pricing and installation data.” Accessed Dec. 24, 2023.
  3. Office of Energy Efficiency & Renewable Energy, “Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics.” Accessed Dec. 24, 2023.
  4. Solar Energy Industries Association, “Minnesota Solar.” Accessed Dec. 24, 2023.
  5. DSIRE, “Minnesota Solar Programs.” Accessed Dec. 24, 2023.
  6. EnergySage, “Minnesota Solar Panels.” Accessed Dec. 24, 2023.
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