Find out if solar panels are right for your home in Alaska.
Does solar work in Alaska? Alaska offers a unique perspective on solar energy due to the sun’s unique pattern and extreme latitudinal position compared to the rest of the United States.
At the farthest North points, the sun behaves unlike anywhere else in the United States. During summer, Alaska’s daylight hours are prolonged. Regions inside the Arctic Circle experience the 'Midnight Sun’, a period where the sun doesn't set for months.
Conversely, winter months experience extended periods of darkness, especially in the far north. This phenomenon is the 'polar night'. The unusual cycle of sunlight presents both challenges and opportunities for solar energy exploitation in Alaska.
Despite the challenges and ranking 49th in the nation for solar, Alaska is making significant strides in harnessing solar energy. As of Q2 2023, the state has achieved an installed capacity of 19 MW.
There is also a projected growth of 45 MW over the next five years. Although the growth is modest, it signals a positive trend.
The average price for a home solar panel system in Alaska is $15,120 for a 6kW system or about $2.52 per watt. Systems will vary depending on the solar installation company the types of solar panels you choose and the size of your system. When shopping for solar panels you should consider getting multiple quotes from various installers.
| Average Cost 6 kW System | Average Cost 10 kW System | Estimated Tax Credit (10 kW System) | Average Cost/Watt | |
|---|---|---|---|---|
| U.S.Average | $18,771 | $31,285 | $9,385.50 | $3.13 |
| Alaska | $17,040 | $28,400 | $8,520 | $2.84 |
| U.S.Average | $18,771 | $31,285 | $9,385.50 | $3.13 |
| Most Costly State(Michigan) | $22,680 | $37,800 | $11,340 | $3.78 |
| Least Costly State(Arizona) | $14,640 | $24,400 | $7,320 | $2.44 |
For most, the ideal solar system size is the sweet spot between price and capacity. The goal is to generate enough electricity to cover your home's demand while keeping overall costs low as possible.
I.E. Get the best bang for your buck.
| System Size | System Cost | Cost After Federal Tax Credit |
|---|---|---|
| 5 kW | $14,200 | $8,785 |
| 6 kW | $17,040 | $10,542 |
| 7 kW | $19,880 | $12,299 |
| 8 kW | $22,720 | $14,056 |
| 10 kW | $28,400 | $17,570 |
As a homeowner considering solar energy, it's crucial to weigh the pros and cons specific to your situation. Particularly in Alaska where it may be more difficult to compare against the rest of the country. It may be wise to talk with an energy professional.
Factors such as your home's location, energy needs, and financial incentives are all important in determining the viability of installing your own system.
While solar energy offers numerous advantages, it's important to acknowledge potential challenges to make an informed decision.
Overall, solar is a viable option but we stress the importance of considering your own personal situation.
Nonetheless, let’s dive a little deeper.
On the positive side, Alaska's unique geographical location offers long sunny summer days. In regions experiencing the 'Midnight Sun', solar panels can generate electricity continuously, capitalizing on this prolonged sunlight.
Additionally, the colder Alaskan climate is advantageous for solar panel efficiency. Generally, solar panels perform better in cooler temperatures. Net metering policies and the absence of general sales tax on solar equipment further enhance the attractiveness of solar investments in Alaska. Without their net metering policy, residents wouldn’t be able to capitalize on their solar system in the winter months.
These incentives, combined with the state's high energy rates, make solar installations a financially viable option for many residents.
If you are on the fence you can use this tool to get an accurate cost breakdown for your home based on your historical energy usage.
There are several ways you can purchase and/or finance your solar panel installation in Alaska. Your goals and financial situation will dictate which option is best for you.
The most straightforward option. You pay upfront for the entire cost of the rooftop solar system. No interest, and fewer headaches, but many people are hesitant about spending several tens of thousands of dollars out of pocket.
The most common method for buying solar systems. Like many other types of large purchases, you can finance your solar system through a bank or solar loan provider.
This sounds great, and many other solar loan salespeople will leverage the low payment to justify the costs. You will likely hear something like "You pay $250 a month on your electric bill, with a solar loan you will pay $200 and have free electricity."
Do your due diligence before you sign on the dotted line. There are many horror stories of variable loan terms, ballooning interest rates, and harsh missed payment penalties.
Leasing solar panels generally involves less money out of pocket upfront. But, it's important to note - you do not own your solar energy system. You essentially renting the solar system. A solar provider will install the equipment and charge you a fixed monthly fee.
Most solar lease contracts last for a couple of decades, during which time the provider will keep an eye on the system's hardware and performance. At the end of your lease, you can choose to:
Solar leases can be complicated. Not all are bad, but in many cases the lease terms in not in favor of the buyer. Before you decide on a solar lease make sure to read your contract thoroughly. If you don't understand something, ask an expert.
A power purchase agreement (PPA) is a financial agreement where a solar company will design and install a solar system on your home or business with little or no cost upfront. Instead of paying a monthly fee like a lease, the agreement includes a fixed price per kilowatt-hour (kWh) of electricity generated.
For example, you agree to pay $0.12 per kWh of electricity generated for the next 20 years. The solar company will install and maintain your system and sell the power back to you that you use. They may also collect payment for any additional energy they put back into the grid.
Just like a lease, you do not own the panels. When the contract is up, they will either be removed or your contract may have other terms for you to buy or renew your power purchase agreement.
Power purchase agreements can be complicated. Before you sign make sure you review the contract and if possible have an expert in power purchase agreements review the details.
In addition to the 30% Federal Solar Tax Credit, you may be eligible for solar incentives that could significantly reduce the cost of solar panel installation. Some incentives are statewide and others are more local. Your city, utility, or other local company could offer hundreds or thousands of dollars in incentives to install solar systems.
This table shows the available incentives in Alaska. But, just because you don't see it here doesn't mean it doesn't exist. Check with your local utility for other potential incentives.
| Name | State | Category | Type |
|---|---|---|---|
| Alaska Solar Easements | AK | Regulatory Policy | Solar/Wind Access Policy |
| Power Project Loan Fund | AK | Financial Incentive | Loan Program |
| Motor Fuel Tax Reduction for Gasohol | AK | Financial Incentive | Sales Tax Incentive |
| Golden Valley Electric Association - Sustainable Natural Alternative Power (SNAP) Program | AK | Financial Incentive | Performance-Based Incentive |
| Energy Efficiency Interest Rate Reduction Program | AK | Financial Incentive | Loan Program |
| Association Loan Program | AK | Financial Incentive | Loan Program |
| Golden Valley Electric Association - Residential Energy Efficiency Rebate Program for Builders | AK | Financial Incentive | Rebate Program |
| Golden Valley Electric Association - Commercial Lighting Retrofit Rebate Program | AK | Financial Incentive | Rebate Program |
| Home Energy Rebate Program | AK | Financial Incentive | Rebate Program |
| Renewable Energy Grant Program | AK | Financial Incentive | Grant Program |
There are hundreds of solar companies in Alaska. From solar installers to solar loan providers, and manufacturers. Each is a piece of the puzzle to help you get outfitted with solar panels.
To make things simple, EnergyBot works directly with 3 of the largest solar companies to give you a comprehensive view of the market.
The solar companies we partner with:
We believe comparing these three names in the solar industry will give you the info you need to decide if solar panels are right for you.
Just because solar is a popular discussion right now, doesn’t mean it makes sense for everyone. It is still a large and expensive decision. Installing solar has great financial and environmental benefits but it won’t feel beneficial if you run into issues. Along with studying a 20-year cost comparison for your home, read some more tips to keep in mind when mulling over your decision on your installer, system design, and financial plan.
There is a solar surge happening across the country and Alaska doesn't want to be left behind. Their growth is highlighted by the recent completion of the state's largest solar farm, the 8.5-megawatt Houston Solar Farm.
This expansive project, featuring 14,000 solar panels over an area equivalent to 34 football fields, marks a pivotal moment in Alaska's renewable energy journey. Located near Houston High School, on a site impacted by the 1996 Miller’s Reach fire, the farm is poised to nearly double Alaska's solar output and provide enough energy to power approximately 1,400 homes. The Houston Solar Farm, a product of Renewable IPP, stands out for its advanced bifacial panels that absorb sunlight from above and reflected light from the snow below, enhancing efficiency.
Beyond the large-scale projects, there is a growing trend of residential solar installations across Southcentral Alaska. Could this be signaling a shift towards renewable energy in anticipation of the dwindling supply of Cook Inlet natural gas? We think so.
These installations are not only contributing to the state’s energy grid but also empowering homeowners to reduce their energy costs and environmental impact. The Matanuska Electric Association is set to purchase the farm's energy at a rate slightly less than that of natural gas, indicating potential savings and a move towards greater energy independence.
We have helped thousands of customers find electricity plans for their home or business. And we are pretty darn good at it, with over 1,000 5-Star reviews we know how to help you stay powered up.
Now using the same one-of-kind technology and platform we are helping consumers in Alaska decide if solar is right for them. You will notice that sometimes our numbers make solar look less attractive. That's not by accident. We believe you should have full transparency during the solar purchasing process.
We aren't here to sell you something. We are here to help you make the best energy decision for your home or business.
The cost of solar panel installation in Alaska can vary significantly based on a number of factors, including the size and type of the system, the complexity of the installation, your solar installer, and the specific location. However, the average cost of solar panels in the U.S. was about $3.13 per watt, before any incentives or tax credits.
A typical residential solar system is usually around 8 kilowatts (8,000 watts), but varies based on energy use and the size of the house. The US average cost for a 6 kW system is $18,771 and the US average cost for a 10 kW system is $31,285, before incentives. The average price for a home solar panel system in Alaska is $15,120 for a 6kW system or about or about $2.52 per watt.
The number of solar panels you would need depends on a variety of factors such as:
To give you a rough estimate, let's say you live in a location that receives about 5 hours of peak sunlight per day, your solar panels have an efficiency of 20%, and each panel has a power rating of 300 watts. If your home uses about 10,400 kWh per year, you would divide this by 365 to get your daily energy use (about 28.5 kWh). You would then divide this by the hours of peak sunlight (5 hours), to get your required power output per hour (about 5.7 kW). If each solar panel produces 300 watts (or 0.3 kW), you would divide 5.7 kW by 0.3 to get the number of solar panels you need, which would be about 19 panels.
The installation process for solar panels can take anywhere from a few days to a few weeks, depending on the size of the system and the complexity of the installation.
Your installer should be able to give you an estimated timeline based on your specific project.
Solar panels generally require very little maintenance. However, it's a good idea to have them inspected every few years to ensure they are working properly and to clean off any debris or dirt that may have accumulated on the panels. Most solar panel installers offer maintenance services for an additional fee.
The inverter, which converts the direct current (DC) from the panels into alternating current (AC) for your home, typically has a shorter lifespan than the panels. You might need to replace it once during the lifetime of your solar system. Factor this into your long-term cost calculations.
Considering batteries alongside your solar system is a smart move. Batteries store excess solar energy, ensuring power availability during outages or when the sun isn't shining. This enhances energy independence and maximizes your solar investment. In areas with variable weather or high electricity rates, batteries can significantly boost savings and provide peace of mind. It's an investment in reliability and efficiency, making your solar system more versatile and effective.
When it comes to solar panels, you'll mainly encounter two types: Monocrystalline and Polycrystalline. Both have their advantages and disadvantages, but either can meet your home's energy needs effectively. In general, Mono-panels are more expensive and more efficient. Poly-panels are slightly less efficient but more affordable. Due to the efficiency difference, you may need a few more poly-panels than mono-panels. There are a handful of other factors as well: roof weight capacity, roof area, roof angle and orientation, and of course your financial limitations.
Instead of making a blind choice, consult with a solar installer who can assess various factors like your budget, location, and energy requirements. They can provide a tailored recommendation, ensuring you get the most efficient panels for your specific situation.
