Did you know that Denver has more than 300 days of sunshine per year? That’s 300 potential days to power your home sustainably and for less than what you pay renting power from the energy grid.
Why go solar in Denver this year? For starters, installing solar panels can increase your home’s value by up to 4%1, they actually function more efficiently in cold weather (no problem in the region’s snowy winters!), and installation is more affordable than ever with local and federal incentives. So why not give it a shot and go solar in the Mile High City? Your wallet (and Mother Earth) will thank you.
Cost of Home Solar Panels in Denver
The average solar panel for home cost in Denver, Colorado was around $2.28 per watt in late 2023, making a typical 6 kW (6000 watt) solar system approximately $9,574 after claiming the 30% solar tax credit.2 However, it’s important to note that the cost of solar panels in Colorado can vary depending on factors such as system size, installation fees, and available incentives, which we’ll cover below. The average cost does include:
- Solar panels
- Mounting equipment
- Inverters
- Conduit and other components
- Installation labor
- Project management, including HOA approvals, permitting, and inspections
Ready to make the switch to solar? Keep reading as we cover all the different ways you can save on a solar panel installation for your Denver home.
How Much Will Solar Save You?
Thanks to a surge in record-breaking US installations, the cost of adopting solar energy has become more affordable than ever before. In fact, solar energy is now becoming cost-competitive with the electricity provided by local utility companies.3 The upfront cost, generously subsidized by local and federal incentives, makes going solar worth the investment.
When you consider that a solar system 6 kW in size can generate more than 9,600 kilowatt-hours (kWh) of energy per year and the average rate of energy in Denver is 15 cents per kWh4, you could save around $1,440 on annual energy bills!
Denver Solar Incentives & Rebates
Numerous financial incentives are available from states, utility companies, and the federal government, further reducing the upfront costs of going solar.
These incentives make it an opportune time for homeowners to consider making the switch to clean and renewable solar power.
Home Energy Rebates
The city of Denver offers Home Energy Rebates5, which cover home improvements, including solar installations. Rebates are available for owners of single family homes, duplexes, and townhomes in Denver. You can also stack these rebates with other state tax incentives and rebates from Xcel Energy, as well as the Inflation Reduction Act, which we’ll cover below.
Fort Collins Utility Solar Rebates
Fort Collins Utilities has launched the BOOST Incentive plan, providing enhanced rebates for residential distributed energy projects until May 31, 2024. New installations can receive up to a $1,500 rebate for solar, $3,000 for batteries, and $5,500 for combined solar and battery storage systems.
Customers expanding existing systems are eligible for even higher incentives: up to $2,000 for added solar, $3,500 for batteries, and a substantial $6,000 for combined solar and battery storage upgrades.
Xcel Energy
Xcel Energy offers both the Solar Rewards Program and Renewable Battery Connect Program.
Solar Rewards Program
Eligible customers installing solar panel systems designed to produce up to 120 percent of their average annual consumption can earn incentives ranging from $0.005 to $0.0375 per kWh, depending on their system’s size, for 20 years in exchange for the energy credits generated.
Those residing within the Income Qualified / Disproportionately Impacted Community (IQ/DIC) areas, identified on the Xcel Energy EnviroScreen map, could receive an enhanced incentive of $1 per watt of installed solar, capping at $7,000—or a 7 kW system. Eligibility for this incentive does not require the homeowner to be income-qualified themselves. The 2023 CO IQ-DIC Developer Guidelines offer a deeper dive into these opportunities.
Renewable Battery Connect Program
This program allows participants to utilize their solar batteries during peak demand scenarios. By automatically discharging customer batteries to alleviate stress on the grid, Xcel Energy incentivizes participation with $500 per kW (up to 50% of the battery cost).
For instance, a Tesla Powerwall owner could save an estimated $3,500. Income-qualified customers stand to gain even more, receiving up to $800 per kW (up to 75% of the equipment cost), which could mean a whopping $5,600 slashed off a Tesla Powerwall cost.
Participants can further receive a $100 annual incentive for being part of the program. More detailed information can be found on Xcel Energy’s Renewable Battery Connect page.
Colorado State Incentives
Sales and Use Tax Exemption for Renewable Energy Equipment
Colorado implemented a sales tax exemption for renewable energy systems in 2006 that can greatly offset overall solar panel costs. The sales tax exemption is a direct discount for homeowners in Colorado who choose to transition to solar energy. This exemption means that when you purchase solar panels or other eligible technologies, you will not be charged the state’s 2.9% sales tax!
For instance, if you were to invest $16,000 in a rooftop solar system, the exemption would exempt the 2.9% sales tax of $464 from your purchase.
Property Tax Exemption for Residential Renewable Energy Equipment
This exemption7 means that if you install a solar panel system on your home, the resulting increase in property value will not be subject to taxation by your municipality.
To put this into perspective, suppose you own a home worth $450,000 in Colorado, and your municipality has a property tax rate of 0.6%. Under normal circumstances, you would owe $2,700 in property taxes annually. However, if you decide to go solar and the installation increases your home value to $475,000, your property taxes would remain at $2,700, thanks to the exemption.
Without the exemption, the $25,000 increase in property value from your solar panels would add an additional $150 to your annual taxes.
Energy Smart Colorado
Energy Smart Colorado is a rebate program that supports various energy efficiency measures and renewable energy systems. For homeowners looking to adopt solar energy or make energy-efficient upgrades, rebates ranging from $500 to $2,500 are available depending on their location.
It’s important to note that Energy Smart Colorado offers solar rebates through sub-programs that focus on specific regions rather than being a statewide initiative. These rebate programs primarily cover areas such as Boulder County, Eagle County, Roaring Fork Valley, and Summit County.
Since rebate programs can evolve over time, visiting the official Energy Smart Colorado6 website for the most up-to-date information on available rebates and eligibility criteria is recommended.
Federal Incentives
The federal government currently provides a 30% solar tax credit to offset the expenses associated with residential and commercial solar installations across the United States.
While the solar tax credit (a part of the Inflation Reduction Act) was initially set to expire in 2023, the recent extension until 2033 through the Inflation Reduction Act ensures that it remains a valuable financial incentive for adopting clean and renewable energy solutions. This extension makes going solar an even more appealing option for individuals and businesses alike!
Solar Installers In Denver to Help You Save
At Freedom Solar Power®, we understand the importance of choosing a reliable, transparent team to handle your home’s solar panel installation. With our extensive experience and expertise as a leader in residential solar, we have successfully equipped numerous homes and even large corporations, including Whole Foods and Office Depot, with solar energy.
Count on us to deliver exceptional service and quality craftsmanship for all your solar power needs! Our dedicated team is ready to assist you in making the transition. Our knowledgeable solar experts will carefully assess your energy bill, evaluate your sunlight exposure, and provide estimates regarding incentives and costs.
Contact us today to make informed solar decisions!
Resources:
- https://www.architecturaldigest.com/solar/do-solar-panels-increase-home-value
- https://www.energysage.com/solar-panels/co/
- https://www.energy.gov/eere/solar/homeowners-guide-going-solar
- https://www.energysage.com/local-data/electricity-cost/co/jefferson-county/denver
- https://denvergov.org/Government/Agencies-Departments-Offices
- https://energysmartcolorado.org/
- https://programs.dsireusa.org/system/program/detail/4210