Paying for Solar
A typical solar water heating system costs $6,000–$9,000. For a solar electric system, the cost depends on the size of the system and the ease of installation, with an average cost range of $8,000–$11,000 for each kilowatt (kW) of capacity. However, incentives and tax credits can cover up to half the cost for both types of systems.
Energy tax credits are available for residential and business taxpayers through the Oregon Department of Energy and the federal government. In addition, cash incentives are available from Energy Trust of Oregon for eligible Oregonians. Water heating incentives are available to Oregon customers who heat their water with electricity from Portland General Electric (PGE) or Pacific Power or gas from NW Natural or Cascade Natural Gas. Solar electric incentives are available to Oregon customers of PGE and Pacific Power.
If you are located in an area not served by these utilities, cash incentives or rebates may still be available to you. Go to Solar Oregon's incentives page to learn more.
Cost examples
The following treatment of tax incentives does not constitute tax advice and cannot be used to avoid IRS penalties. The prices listed below are examples only.
Solar electric system—2,000 watts
Pacific Power customer
$20,000 |
Total installed cost* |
- $4,000 |
Energy Trust incentive ($2.00/watt) |
$16,000 |
Amount homeowner pays to contractor |
- $6,000 |
Oregon tax credit ($3.00/watt, $6,000 cap) |
- $2,000 |
Federal tax credit (30% of $16,000, $2,000 cap) |
$8,000 |
Final cost to homeowner |
* Solar electric system costs vary and depend on size. Typical systems range from $8–$11 per watt installed.
Solar water heating system—saves 2,200 kWh/year
Portland General Electric (PGE) customer
$8,500 |
Total installed cost* |
- $880 |
Energy Trust incentive ($0.40/kWh) |
$7,620 |
Amount homeowner pays contractor |
- $1,320 |
Oregon tax credit ($0.60/kWh, $1,500 cap) |
- $2,000 |
Federal tax credit (30% of $7,620, $2,000 cap) |
$4,300 |
Final cost to homeowner |
*Prices for solar water heating systems start at $6,000–$9,000.
Tax credits and incentives
Oregon and federal tax credits and Energy Trust incentives are subject to change. Please visit each organization's Web site to learn the most up-to-date information.
Solar electric
Tax credits
Oregon: $3.00 per watt, up to $6,000 ($1,500 claimed per year over 4 years)
Federal: 30% of installed cost less cash incentives, up to $2,000Energy Trust incentive
Up to $10,000, based on rated capacity of solar panels in wattsDC
PGE customers: $2.25 per wattDC
Pacific Power customers: $2.00 per wattDC
Solar water heating*
Tax credits
Oregon: $0.60 per kWh, up to $1,500
Federal: 30% of installed cost less cash incentives, up to $2,000Energy Trust incentive
Up to $1,500, based on rated annual energy savings
Electric hot water: $0.40/kWh (PGE/Pacific Power customers)
Gas hot water: $0.30/kWh (NW Natural/Cascade Natural Gas customers)*Tax credits and incentives also available for solar pool heating.