How Much Will Solar Panels Cost in 2026?
As we move into 2026....
Homeowners are looking ahead and trying to understand where solar pricing is headed. With utility rates rising across the country and federal incentives still in place, many people want to know if next year will be the right time to install a system.
Below is a clear look at what solar is expected to cost in 2026, what influences those numbers, and how the federal Investment Tax Credit plays into your total out-of-pocket cost.
Why Costs Are Shifting Heading Into 2026
The solar market is shaped by several factors. These include supply chain conditions, labor costs, equipment improvements, new regulations and the financial incentives available at the federal and state level. Solar panel pricing has remained fairly stable through 2024 and 2025, and most analysts expect similar trends into 2026 with modest fluctuation.
At the same time, electricity prices continue to climb due to aging grid infrastructure, natural gas volatility and increased strain from data centers. This means the long-term savings advantage of solar is growing even if equipment costs have no changed much.
Expected Solar Panel Costs in 2026
Current national data points to average residential system pricing landing in a similar range to 2025.
Typical pricing for a full system in 2026 is expected to fall somewhere in these ranges:
Roof mounted systems: should remain within a predictable price per watt depending on size and complexity.
Ground mounted systems: will continue to be more expensive because of engineering, trenching and conduit runs.
Battery add-ons: extra cost but often included in 2026 planning due to growing interest in backup power and grid independence.
Variables that shift the price include roof condition, structural requirements, shading, equipment selection and local permitting factors.
Residential ITC Ends After December 31, 2025
If you are a homeowner, this is one of the biggest changes you’ll need to understand.
Under current law, the 30 percent Residential Clean Energy Credit ends for homeowner-owned solar systems placed in service after December 31, 2025. To qualify, your system must be installed and energized by that date.
If completed before the cutoff, homeowners can still:
- Claim the full 30 percent credit for that tax year.
- Carry over any unused portion of future years
How Commercial and Nonprofit Solar May Shift in 2026
The commercial ITC continues into 2026 with new restrictions. To receive the full 30 percent credit, commercial, nonprofit and public projects must begin construction before July 4, 2026. These projects must also comply with increasing restrictions on components sourced from Foreign Entities of Concern.
Because commercial projects retain access to incentives while residential projects lose them, many companies may shift toward third-party ownership models such as:
Power Purchase Agreements (PPAs)
A solar company or investment group owns the system, claims the commercial ITC and sells the homeowner energy at a fixed monthly rate. In many cases, the homeowner takes ownership after five years when tax benefits and depreciation have been fully realized by the company.
Lease or rental-style agreements
A company installs and owns the system and the homeowner pays a predictable monthly fee, while the company collects the commercial incentives.
Community solar or subscription-based models
Nonprofits and public entities may choose these structures to access commercial benefits without needing upfront capital.
Why companies may move this direction
Since the residential ITC expires at the end of 2025, companies lose a major incentive tied to homeowner-owned solar. Third-party ownership models allow developers and investors to continue offering low or no upfront cost options by leveraging the commercial ITC, depreciation and other financial tools.
In 2026 this means that we may see:
Homeowner-owned systems will cost more than they do today
PPAs and leases may return in larger numbers
Five-year ownership transfers may become more common
“Zero upfront cost” messaging may become widespread again
For homeowners, the structure of the project in 2026 will determine who receives incentives, who owns the system and how financial benefits are distributed.
What Homeowners Should Compare Beyond Cost
A low sticker price is not the full story. Solar is a construction project that ties directly into your home’s electrical infrastructure. It should be treated with the same seriousness as roofing or major electrical work.
Here are the factors that matter most:
Equipment quality
Panel brand, inverter selection, degradation rate and warranty length all influence long-term performance.
System output
Cheaper systems that under-produce cost more over the life of the system. Production matters.
Company structure
Many companies are sales groups that outsource engineering and installation. When those subcontractors are unavailable later, the homeowner has no one to call for help.
A true EPC manages engineering, permitting and installation in-house. One company is responsible from start to finish.
Warranty support
Ask if the installer registers panel and inverter warranties on your behalf. Unregistered equipment may not be covered.
Financing
Compare interest rates, fees and total lifetime cost. Financing structures may change after the ITC expires.
Does Solar Still Make Sense in 2026?
Even with the residential tax credit ending after 2025, solar continues to deliver long-term savings and stability. Utility rates are rising across most of the country and homeowners who generate their own power reduce their exposure to future price increases. What is changing is the way many solar companies plan to structure projects starting in 2026.
With the residential ITC gone, many companies are expected to pivot toward third-party models such as PPAs and leases. These structures allow developers and investors to use the commercial tax credit and depreciation benefits that homeowners no longer have access to. Some companies will use this to advertise low or no upfront cost programs. Others will shift away from residential work altogether and focus on commercial projects where incentives continue.
This is exactly why ARC created Solar On The House. Instead of pushing homeowners toward third-party contracts with unclear ownership and limited transparency, Solar On The House gives homeowners access to a simple, predictable path. The system is built and owned by ARC, homeowners get guaranteed savings and full service support and ownership transfers after the benefit period. Families get the stability of solar without the upfront cost and without being locked into aggressive lease terms from out-of-state companies.
Solar still works because it reduces long-term energy costs. The difference in 2026 will be the structure of the programs and who is offering them. ARC remains committed to providing clear, local and accountable options. Whether you want to purchase your system or you want Solar On The House, our team engineers and installs every project with the same standard of quality.