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How to read a solar quote
Solar quotes are hard to compare on purpose. Here is how to cut through one in about ten minutes — including the number most quotes don’t show you.
Start with one question: “What is the cash price?” Ask it even if you intend to finance. Everything else on the quote — the monthly payment, the APR, the savings projection — is easier to judge once you know what the system actually costs.
The three numbers that matter
A quote may run twenty pages. Almost all of it is decoration. Find these three:
| Number | Where to find it | Why |
|---|---|---|
| Cash price | Ask for it explicitly if it isn’t shown | The only figure that isn’t shaped by financing |
| System size in watts | Given as kW — multiply by 1,000 | Tells you what you’re actually buying |
| Cost per watt | Cash price ÷ watts. Do this yourself | The only way to compare two different quotes |
An 8 kW system at $26,000 is 26,000 ÷ 8,000 = $3.25 per watt. Now you can hold it against any other quote, regardless of size or equipment. Typical range is $2.50 to $3.50.
The number hiding in the financing
This is the part of solar buying least understood by homeowners, and it deserves careful reading rather than outrage.
When an installer offers you a very low interest rate — 0.99%, 1.99%, sometimes 0% — the lender charges the installer a dealer fee for providing it. That fee commonly runs 15% to 25% of the system price, and sometimes as high as 30%. The installer recovers it by raising the price of the financed system.
So the same 8 kW system might be:
- $26,000 if you pay cash — $3.25 per watt
- $32,500 if you take the 0.99% loan — $4.06 per watt
Crucially, that fee is not included in the advertised APR. The interest rate you’re shown is real. It’s just being charged on an inflated balance. You’ve prepaid the interest rather than avoided it.
It’s common to read that low-rate solar loans always cost more. That isn’t true, and it’s worth knowing the actual arithmetic before you walk away from one.
Take the example above — $26,000 cash versus a $32,500 balance at 0.99%. A solar loan is equivalent to borrowing the cash price elsewhere at roughly:
5.7% over a 10-year term · 4.2% over 15 years · 2.9% over 25 years
So if the best you can get from your bank or credit union is 7%, the solar loan is genuinely the better deal. If you can borrow at 4% on a 15-year term, it’s a wash. The longer the term, the better the dealer-fee loan looks.
Where the fee does real damage
If you’re paying cash. Some buyers are quoted the financed price and pay it in full, handing over thousands of dollars for a loan they never took. Always ask whether the price changes if you pay cash. It very often does.
When comparing quotes. A financed quote and a cash quote are not comparable. Put every quote on a cash basis before you judge cost per watt, or you’ll pick the wrong installer.
If you sell or refinance early. The balance you owe is the inflated one, and you won’t have had the years of low payments to make up for it.
If the quote is a lease or PPA
With a lease or power purchase agreement you don’t own the panels, so there’s no purchase price to examine. Look instead for the escalator — the clause that raises your payment every year, typically by 1.5% to 2.9%.
It compounds quietly. A PPA starting at 13¢ per kilowatt-hour with a 1.9% escalator reaches about 15.4¢ by year 10 and 18.6¢ by year 20.
That may still beat your utility if their rates rise faster. It may not. The question to ask is simple and most salespeople won’t raise it for you: what happens if utility rates rise more slowly than this escalator?
Also confirm, in writing:
- What happens at the end of the term — buy out, renew, or removal
- What it costs to transfer the agreement if you sell the house
- Who repairs the system, and how fast they’re obliged to
The production estimate
Every quote projects how many kilowatt-hours the system will produce each year. This figure drives every savings claim, and an optimistic estimate makes a bad deal look good.
A rough sanity check: in most of the continental US, each kilowatt of solar produces somewhere around 1,200 to 1,600 kWh per year. So an 8 kW system should land near 9,600–12,800 kWh annually. A quote claiming 16,000 kWh from 8 kW deserves an explanation.
Then ask whether there is a production guarantee — a written commitment to compensate you if the system underdelivers against the estimate. If the company won’t stand behind its own number, that tells you what the number is worth.
The equipment lines
Your quote should name specific models, not categories. Check that you can see:
- Panel make and model, wattage, and quantity
- Inverter make and model, and whether it’s a string inverter, microinverters or optimizers
- Panel product warranty and performance warranty — two different things, both in years
- Inverter warranty — usually shorter than the panels, and it’s the part most likely to need replacing
- Workmanship warranty — the installer’s own guarantee on the labor and the roof penetrations. Ten years is a good sign; one or two years is not.
“Tier 1 panels” or “premium inverter” without a model number is not a specification. Ask for the model number.
What’s often missing
Ask specifically whether each is included or excluded:
- Electrical service panel upgrade
- Roof repair or replacement
- Tree trimming or removal
- Permit and utility interconnection fees
- Monitoring after the first year
- Removal and reinstallation if the roof is replaced later
Pressure to sign today. A price that expires within 24 hours is a sales tactic. A real quote holds for weeks.
Monthly payment quoted instead of a price. If you cannot easily find a total, that is a choice someone made.
Savings projections with a rate escalation assumption you can’t see. Twenty-five-year savings figures depend entirely on an assumed utility rate increase. Ask what percentage they used. Anything above about 4% a year is optimistic.
Refusal to give a cash price. The one genuine red flag on this page.
Comparing three quotes
Put them side by side on these lines. Anything else is noise:
- Cash price
- System size in watts
- Cost per watt (cash price ÷ watts)
- Estimated annual kWh — and kWh per kW installed
- Panel and inverter model
- Workmanship warranty, in years
- Production guarantee: yes or no
- Exclusions
Three quotes is the number worth getting. It’s consistently the cheapest thing you can do to lower your price, and it costs nothing but time.
Sources
- IntegrateSun, Solar dealer fees explained: the hidden cost inflating your loan.
- NuWatt Energy, Solar financing 2026: cash vs loan vs lease vs PPA.
- NuWatt Energy, Solar payback comparison — PPA escalator figures.
- EnergySage, Solar panel output — annual production per kW.
- EnergySage, Solar panel cost — cost per watt ranges.
Loan and escalator figures in this article were calculated directly from the example amounts shown, using standard amortization. You can reproduce them with any loan calculator.