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A solar system and installation costs between $9,000-$16,000 on average in Louisiana. Solar And Energy
Leonardo David is an electromechanical engineer, MBA, energy consultant and technical writer. His energy-efficiency and solar consulting experience covers sectors including banking, textile manufacturing, plastics processing, pharmaceutics, education, food processing, real estate and retail. He has also been writing articles about energy and engineering topics since 2015.
Tori Addison is an editor who has worked in the digital marketing industry for over five years. Her experience includes communications and marketing work in the nonprofit, governmental and academic sectors. A journalist by trade, she started her career covering politics and news in New York’s Hudson Valley. Her work included coverage of local and state budgets, federal financial regulations and health care legislation.
Solar power is less expensive in Louisiana than most parts of the country. The average cost of a home solar system in the state is $2.64 per watt — 7.4% less than the national average of $2.85. To cover the annual electricity usage of a typical home in Louisiana, you would need a solar system capacity of about 10 kilowatts (kW), based on the MarketWatch Guides team’s calculations. Given the state’s solar rates, you can expect to pay $26,400 for a system of this size, but the net cost drops to $18,480 after considering the federal tax credit.
Louisiana experiences high levels of sunshine thanks to its southern location, so a 10 kW solar system could offset about $1,600 per year in electric bills. Multiply those savings over the 25- to 30-year life of a solar panel system, and you could save more than $40,000.
With its heat and humidity, Louisiana consumes more electricity than other states. According to the U.S. Energy Information Administration (EIA), a typical home in the Pelican State uses 14,776 kWh of power per year. That amount is almost 40% higher than the average annual consumption nationwide of 10,566 kWh. Considering the state’s average electricity usage, homeowners could use a 10 kW solar panel system to match consumption, but size will vary.
Our team estimated the typical cost of solar power systems ranging from 5 kW to 10 kW in Louisiana, both net system costs and rates after claiming the 30% Investment Tax Credit (ITC).
*Costs are based on market research conducted by the MarketWatch Guides team. Your price may vary depending on project specifications.
The best solar companies offer a free consultation to assess your energy bills and site conditions. A site visit will help a solar professional determine the ideal system size and solar panel layout for your home. The installer will then use the information from the assessment to deliver you a system design and cost estimate.
In addition to your location, a primary factor when determining what it costs to install a solar photovoltaic (PV) system is the capacity in kilowatts. Other variables include local and state incentive programs, skilled labor costs and state regulations. Here is a breakdown for Louisiana:
Louisiana has no state tax credits or rebate programs for solar owners, based on our research. The only major incentive for residents is the nationwide federal tax credit, which offers 30% of total project costs as a tax credit for the year after you install solar power.
However, Louisiana has a property tax exemption for homeowners with solar energy systems. The incentive does not offset the cost of adding solar panels. Rather, it prevents property taxes from going up if a home gains value because of an added solar system.
Because Louisianans use so much home energy, based on EIA data, you may need a larger-than-average solar panel array when transitioning away from the traditional power grid. A smaller 5 kW or 6 kW system may suffice in some cases, but other Louisiana residents could need a system size of between 8 kW and 10 kW to effectively and efficiently meet their home’s energy needs.
One bonus for solar homeowners in Louisiana is the availability of net metering programs throughout the state. Once a solar system is in place, you can sell the excess energy your panels generate back to your utility company for billing credits. However, sell-back rates vary widely throughout the state, based on our research. Some electric companies give you credit at retail prices, including Entergy Louisiana, which provides electricity in New Orleans and Baton Rouge.
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Here are a few recommendations to reduce the cost of your home solar system and boost your return on investment.
Louisiana has a few major incentives for homeowners who go solar, including a federal tax credit and property tax exemption.
The solar federal tax credit is a nationwide incentive that applies to residential solar systems and batteries. The credit allows you to claim 30% of your total solar system cost as a tax credit to lower your federal tax burden. So if you pay $26,400 for a 10 kW solar system in Louisiana, you’re eligible for a federal tax credit of $7,920. If you’re not able to use the full tax credit, you can roll the difference to the following year. Also, if you opt to add a solar battery to your system, which is a major expense, it counts toward your investment.
If you own a home in Louisiana and install solar panels, the increase in home value receives a property tax exemption. This incentive does not lower your upfront costs, but rather provides annual tax savings:
Our team surveyed 1,000 homeowners with solar panels nationwide in October 2023 using Pollfish. In Louisiana, 91% of respondents reported using incentives to help pay for their solar installations.
Net metering is an electricity billing method that can increase your savings from solar panels. If your electric company offers net metering, you can sell the excess solar generation that your home does not use in exchange for billing credits. Without net metering, you lose the value of this electricity unless you store it in a home battery, which can cost more than $12,000.
Louisiana has a net metering policy for home solar systems up to 25 kW that mandates local utilities must buy your excess energy production. However, there is an important catch — net metering rates vary widely across the state. Our team recommends enrolling in net metering, but suggests you consider the rates when you size your solar system. For example:
Our team recommends you take the time to review and compare several solar offers. Over 60 solar companies conduct business in Louisiana and equipment quality and prices will vary widely.
You can expect some variation regarding the state’s average price of $2.64 per watt, but carefully consider any offers that seem excessively high or low. You can also check equipment and workmanship warranty terms, keeping in mind that the best solar companies offer warranties between 25 and 40 years, based on our research.
You can compare offers from our team’s picks for top solar installers in Louisiana below.
The long-term savings from solar panels can outweigh the upfront cost, but equipment and installation represent a considerable financial investment. You can expect to pay about $26,400 for a 10 kW solar system in Louisiana and the state has no major rebate programs, based on our research. The federal tax credit offers 30% of total project costs as an income tax reduction, but you must wait until the tax season after installing panels to claim it.
However, many solar companies offer financing options that include:
With a solar loan, you can finance a system for a monthly cost plus accrued interest over time. However, unlike a loan, the provider maintains ownership of the system under a lease or PPA, which essentially represents a system rental agreement. A solar PPA is similar to a lease, but you pay for the electricity generated instead of a fixed monthly fee. To make the deal attractive, providers set the kilowatt-hour price of energy at a lower rate than local electric rates.
Our team asked solar owners about their chosen payment method in our October 2023 survey, with the following results among Louisiana-based respondents.
Among solar owners who took our survey in Louisiana, more than half preferred an upfront cash purchase. Although the state offers limited solar incentives, the cost of solar PV systems remains below the U.S. average.
If buying a solar panel system is not feasible based on your budget, our team recommends loan financing. With a loan, you own the solar panels, which offers two major benefits:
Given the advantages of solar loans, the MarketWatch Guides team only recommends a solar lease or PPAs if you cannot access loan options. Leases and PPAs have simpler application requirements than loans but usually charge higher monthly payments, which can eat into your monthly energy savings.
A 10 kW solar panel system can generate around 14,600 kWh of energy per year in cities such as New Orleans or Baton Rouge, which we estimated using the National Renewable Energy Laboratory (NREL) PVWatts calculator. Here’s a breakdown of how much you can save with solar energy in Louisiana.
Electricity savings are not the only financial benefit solar panels offer. You can also see an increase in home value, which is exempt from property taxes in Louisiana. For example, if you own a $300,000 home with a 0.60% tax rate, you pay $1,800 per year. If your home value increases to $330,000 with solar panels, your annual property taxes will stay the same.
The financial outlook is less favorable if you lease your system or use a PPA. For example, if a 10 kW solar system saves $1,664 a year but you have a lease payment of $125 a month, that leaves you with only $164 in annual savings.
Ranked at No. 38 in the country for installed solar capacity, the solar industry has room for growth in Louisiana. The state only generates around 3% of its electricity from renewable sources, according to the EIA, with the majority of its power coming from fossil fuels and nuclear energy. However, there is an optimistic growth outlook for Louisiana’s solar industry.
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You can expect to pay $2.64 per watt of installed capacity, or $2,640 per kilowatt in Louisiana. So a 5 kW solar system will cost around $13,200, while a 10 kW system would cost about $26,400. Regardless of system size, you can claim a 30% tax credit from the federal government to lower your cost.
No. As of September 2023, Louisiana has no programs in which the state purchases solar panels for homes. If you want to avoid a cash purchase, you can go solar at $0 upfront cost by choosing a company that offers financing options like a solar loan or lease. However, be mindful of solar scams offering “free” Louisiana solar panels.
According to the EIA Residential Energy Consumption Survey, homes in the southern U.S. size 2,000 to 2,499 square feet have an average electricity consumption of 15,269 kWh per year. Assuming favorable sunshine conditions, you would need 10 kW to 12 kW of solar capacity to generate this electricity output. Using 400-watt (W) solar panels, you would need 25 to 30 panels to reach this capacity.
You can work with a solar installer to determine the correct number of panels to power your home.
No. Louisiana offers a property tax exemption for home solar systems, but no state tax credits. However, Louisiana residents can claim the 30% federal tax credit, a nationwide incentive.
We conducted in-depth research and analyzed several factors to determine our solar cost data, which is based on the following resources:
We closely evaluate solar installation companies with a focus on the factors most important to homeowners like you. We based our solar company methodology on input from multiple homeowner surveys, discussions with industry experts and research into the renewable energy market. Our review process involves assessing each company on the following criteria, which we then use to calculate a rating out of 5 stars. Cost and payment options (20 points): Cost is one of the most important factors when installing a solar energy system. Solar providers that offer cash purchases and in-house loan financing earn full points in this category. Companies also receive bonus points for offering solar panel leasing or power purchase agreements (PPAs). Services (20 points): In addition to solar installations, companies offering backup battery and electric vehicle charger installations, energy efficiency audits and system monitoring earn the most points in this category. Companies can also receive points for completing installations in-house, as opposed to using third-party contractors. Reputation (20 points): To assess the reputation of each company, we consider Google star ratings, Better Business Bureau (BBB) scores and reviews, and NABCEP certification status . We also look at customer complaint rates on sites like the BBB and weigh how the company responds. Warranty (15 points): We verify that each company offers workmanship, product and performance warranties on all of its solar installs. A provider earns more points for extending warranties that meet or exceed industry standards, including 10 years for system workmanship and products and 25 years for panel performance. Customer Support (10 points): Solar companies that offer virtual consultations, a mobile app, 24/7 customer support and high customer satisfaction with backend support earn the most points in this category. Industry Experience (10 points): Providers with 10 or more years of experience in the solar installation industry earn a perfect score in this category. Sustainability (5 points):To measure sustainability, we assess each company based on whether it shares a detailed sustainability statement or ESG disclosures on its website. We also conduct research to see if companies offer end-of-life panel disposal programs or have eco-friendly community partnerships.
If you have questions about this page, please reach out to our editors at editors@marketwatchguides.com.
Leonardo David is an electromechanical engineer, MBA, energy consultant and technical writer. His energy-efficiency and solar consulting experience covers sectors including banking, textile manufacturing, plastics processing, pharmaceutics, education, food processing, real estate and retail. He has also been writing articles about energy and engineering topics since 2015.
Tori Addison is an editor who has worked in the digital marketing industry for over five years. Her experience includes communications and marketing work in the nonprofit, governmental and academic sectors. A journalist by trade, she started her career covering politics and news in New York’s Hudson Valley. Her work included coverage of local and state budgets, federal financial regulations and health care legislation.
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