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How Much Do Solar Panels Cost?

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The cost of a solar panel system depends on a number of factors. The main factors are:

1. System Size

The larger the system size, the more costly it is. The smallest systems for homes are usually 1.5 Kilowatt (KW) systems, which generally cost between $2,500 and $3,000, depending on the brand and the city you live in. These would normally supply around 30% of the average household’s electricity needs. Home systems go as far as 10KW, however most households wouldn’t need more than 5-7KW. The power generated by a 5KW system would be almost equal to the electricity used by the average Australian household. A 5KW system generally costs betwen $5,000 and $7,000.

2. Brand

You’ll normally pay a premium for a system using good solar panel and inverter brands. Expect to pay around 10-20% more than what you’d pay for a low to mid-range brand. This could be worth it in the long-run, as solar panel warranties last up to 25 years. Established brands are more likely to still be around then if you need to claim on your warranty.

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3. Panel Quality

You may find two panels with the same output in KW, but with significantly different prices. This is mainly due to the panel quality. You’ll normally pay more for panels with:

  • Higher Module Efficiency: these panels produce more power per square metre of panel area.
  • Positive Power Tolerance: these panels guarantee to produce more electricity than what they’ve listed in their specifications.
  • Lower Temperature Co-efficient: the loss of electricity output in high temperature conditions is lower with these panels.

If you are installing a medium to large capacity system (3KW or more), then you may need to use higher efficiency panels, as you may not have enough roof space to house a large number of lower efficiency panels. Using higher efficiency panels could increase the cost of your system.

4. Government Assistance

The Federal Government provides a subsidy towards the purchase price of solar PV systems in households. This subsidy is not a rebate as many people think, but instead comes in the form of Small-Scale Technology Certificates (STCs), which are assets traded on a market.

The Federal Government gives you a set number of STCs when you buy a solar PV system. The number of STCs you get is based on how much electricity your system is expected to produce in the region where you live. STCs are traded on a market, so the value of these fluctuates. Over the last few years, STCs have usually been worth around $30-$40 each. As a guide, a 1.5kw system usually receives approximately 25-30 STCs. You can calculate the number of STCs for a particular system size at the Clean Energy Regulator website.

You should note that the price that an installer will quote you is almost always calculated after selling your STCs. Selling the STCs that apply to your system can be quite complicated, so it’s usually better to let the installer do this, rather than doing it yourself.

 

What you should expect to pay

Solar Choice does a regular survey of solar panel system prices across all main capital cities. The table below shows the average price you could expect to pay nationally for each system size as at June 2018.

System Size Average Price
1.5kW $2,738
2.0kW $3,305
3.0kW $4,018
4.0kW $4,807
5.0kW $5,454
7.0kW $8,065

These prices are a guide – you might find something cheaper by shopping around with individual installers in your area.



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