Homeowners are showing more willingness to add solar panels as installation costs drop. California has mandated their installation on most new construction. In 2020, California became the first state to require that newly built homes, with a few exceptions, must include a rooftop solar system.

Home buyers and homeowners are more motivated to install solar panels for potential savings in utility costs.

Even as prices for solar installation drop, it can still be a costly expense for homeowners. The average cost to install a residential solar system is $20,000, according to the Solar Energy Industries Association. However, homeowners do often have the option to purchase a solar panel system or lease it.

You can calculate the payoff time for installing solar panels by looking at incentives, utility bills, and how much you may get paid for excess power that your home generates.

Tax credits—whether local, state, or federal—can help offset some of the installation costs. The federal residential solar energy tax credit allows homeowners to claim 22% of the cost of installing a solar panel system in 2021.

The cost-effectiveness of solar panels depends on the local price of electricity, the price utility companies pay residents for any excess electricity generated, the solar panel installation cost, the amount of sun the panels receive, and the orientation of the panels, according to a study conducted last year by the Home Innovation Research Labs at the National Association of Home Builders.

Experts say that the use of residential solar power is growing. The biggest factor is the extreme decline in the cost of installing a solar panel system. The cost of electricity is extremely high in California. Those two factors accelerate homeowner interest in solar panels.

Also, as they become more common, there’s less pushback on how it looks. That’s becoming a nonissue now, but in the past, some homeowners only wanted them in the back of the house where they couldn’t be seen.