In 2022, Congress passed additional tax credits in the Inflation Reduction Act to help more Americans invest in rooftop solar installation. A small percentage of all homes (2.7%) had solar panels installed by the end of 2022. Overall, residential solar generates a small fraction of total US energy, making up less than 1% of all electricity production in 2022.
Energy produced by small-scale solar vs. utility-scale solar facilities
Small-scale solar installations, including those at homes, businesses, and non-utility industrial sites, collectively generated 29% of all solar power in the US in 2022. At 61 million megawatt hours produced, small-scale solar power generated enough electricity for 5.6 million homes. That level of production is more than five times the amount from 2014.
In 2022, the total capacity of small-scale solar installations in the US had grown to more than five times the total capacity in 2014, when the Energy Information Administration began publishing this figure. The capacity rose from 7.3 gigawatts in 2014 to 39.5 gigawatts in 2022.
A variety of technologies convert sunlight to usable energy for buildings. Solar photovoltaics (PV) is the most commonly used solar technology to power homes and businesses, according to the Energy Department. PV devices convert sunlight into electricity. An arrangement of multiple PV panels can produce electricity for an entire house or small business, also known as small-scale generation. Some PV power plants have large arrays that cover many acres, known as solar farms, to produce electricity for thousands of homes.
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Which states produce the most small-scale solar energy?
In 2022, California homes produced more solar energy than any other state, producing 23 million megawatt hours. This was enough electricity to power approximately 2 million homes. That amount of power is five times larger than the amount of solar power the state produced in 2014. Arizona was second, producing enough electricity to power more than 330,000 homes.
Almost every state has at least doubled its solar power generation since 2014. Twenty-nine states and Washington, DC, produce at least six times more solar power, sometimes much more.
Hawaii has the largest share of homes powered by small-scale solar energy: 33% of single-family homes have installed residential solar power systems. California follows with 20% and Arizona at 12%, according to the National Renewable Energy Laboratory. Nationwide, 4.4% of single-family homes have solar power systems installed.
How much do solar energy systems cost?
Installing a residential solar power system typically costs between $15,000 and $35,000, according to the Department of Energy. Prices fluctuate based on location, the size and structure of individual homes, and the amount of energy a homeowner wants from their system. The federal solar tax credit covers 30% of a qualifying home solar energy system installed by the end of 2032.
In terms of energy produced, the cost of solar panels has fallen by nearly two-thirds since 2010. In 2022, the total cost of residential solar energy systems cost $3.16 per watt, compared to $8.70 per watt in 2010.