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Despite paying some of the lowest electric bills in the US, Colorado residents are increasingly opting for solar panels to save money on energy bills and lower household carbon emissions. The solar industry in Colorado is growing thanks to federal and state incentives. The Inflation Reduction Act has also applied a major 30% tax credit on all clean energy additions to households nationwide. Switching to solar energy has never been easier.
Colorado has also made it easier to switch to clean energy, thanks to local incentives. It has a strong net metering policy that lets homeowners get power from the grid when their solar panels don't generate enough to power their household. There's also a property tax exemption, which means you won't have to pay any taxes on the value the solar panel system adds to your home.
If you're thinking about going solar in Colorado, these are the best solar installers to keep an eye on.
The best national solar companies in Colorado
We've compiled a list of solar panel companies that excel in the industry. Here are a few top national solar companies that operate in Colorado, as scored by CNET's experts. As with most large projects, it's a good idea to get multiple quotes before making a decision.
Palmetto Solar
Best overall
Solar panels are typically low maintenance equipment, but they're also unfamiliar. If you want to reap the benefits of solar but will have a bit more peace of mind if someone else is making sure it's working, Palmetto might be a good fit for you. Just remember to add the cost of Palmetto's monitoring service in to your payback period calculations.
EnergyPal
Most flexible
EnergyPal is more than just a middleman. It'll handle your solar installation from beginning to end while also allowing you to benefit from its proprietary engine and competitive bidding process. The company offers a range of hardware for panels, batteries and inverters, has plentiful financing options and offers responsive customer service support.
Freedom Forever
Best for cash customers
Include Freedom Forever in your search if you want the backing of a national company that installs a wide variety of the most popular solar equipment available. Freedom Forever also extends a couple of products that take some of the pain and risk out of going solar, like a production guarantee and an escrow option with cash purchases. Online reviews say customer satisfaction has been low of late, though the company says that's changing.
Tesla Solar
Most affordable
Tesla's solar branch seems to be the least loved of Elon Musk's ventures. Even Tesla's Solar Roof seems to get more love.
If price is the thing you won't budge on, consider Tesla. By all accounts, Tesla installs quality panels and makes the closest thing there is to a household name in solar storage: the Powerwall.
Where you might miss out is customer service. Discussion online seems to suggest Tesla's service is a bit of a gamble.
Local solar installers in Colorado
Established in 2018, Solar Wave claims that it has established a business model that eliminates sales commission to pass savings on to customers. The company claims that it is able to sell you the best equipment at the lowest prices.
Solar Wave also takes on a limited number of installations every month; it claims that this is to provide the highest level of attention to your project. The owner of the company claims that he personally establishes himself as the point of contact for every installation.
Solar Side Up has a focus on the Front Range Colorado market, servicing customers around the mountainous region. The company has a long track record, having been founded over a decade ago in 2011. It claims that an established network of connections allows customers to get savings on a wide range of products: solar panels, inverters, racking and batteries.
The company claims that it combines solar panel installation experience with roofing projects, enabling customers to take advantage of an installer that can take on the necessary roofing job that could be a prerequisite for installing a solar panel system.
How to determine which solar company is best for you
Before choosing a solar panel installation company, it's recommended to reach out to multiple installers and get bids from them before moving forward. Consult with these installers for price options, as well as to see if they meet all of your installation needs.
In addition to affordability, important variables you may want to consider when choosing a solar installer include the company's reputation, reviews and products and warranties they offer.
If you need additional assistance from a third party, Solar United Neighbors is a nonprofit that operates a free helpdesk for consultations.
Cost of solar panels in Colorado
Here's a look at the average cash price for a typical solar panel system in Colorado before factoring in tax credits and incentives, according to data from FindEnergy.com.
Average cost of solar panels in Colorado
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| Typical system size (kW) | Price per watt | Total installed cost | Cost after 30% federal tax credit | |
| Colorado | 5 | $3.80 | $19,000 | $13,300 |
| National average | 5 | $3.58 | $17,900 | $12,530 |
The following infographic displays the average total price, cost per watt and system size for solar panel systems across the country, according to data from FindEnergy.com. The estimates provided are not representative of any fluctuations from tax credits or state solar incentives. If FindEnergy doesn't have solar data for a particular state, it appears grayed out on the map.
Colorado solar panel incentives or rebates
The residential clean energy credit (formerly called the investment tax credit) is a federal solar incentive offered in every state that credits you 30% of the total cost of your solar system when you file their federal income tax. The rate increased from 26% after the Inflation Reduction Act passed in August 2022.
There is no cap on the amount of money you can claim with this credit, as long as you have enough taxable income. This means you can receive the full 30% regardless of the size or cost of your system.
To apply for the residential clean energy credit, fill out IRS form 5695 (PDF). The IRS provides detailed instructions on how to fill out the form properly. Once your application is approved, you will receive your credit when you file your federal tax return.
There are several solar tax credits and incentives available at the federal, state and local levels to make solar panels more affordable. Depending on where you live in Colorado, you may qualify for several additional solar incentives.
Colorado solar incentives
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| Residential clean energy credit | Extended through 2032 by the Inflation Reduction Act, this federal solar tax credit will reimburse you for 30% of the cost of a solar system when you file your tax return. |
|---|---|
| Property tax exclusion | When you add a solar panel system to your home, typically that home's property value also increases while increasing property taxes. The property tax exclusion in Colorado will exempt you. |
| Sales tax exclusion | Residential solar panel equipment is excluded from state sales tax applying in Colorado. |
| Net metering | Most utilities in Colorado, such as Colorado Springs Utilities, offer a net metering program where the utility will buy back excess stored solar energy. |
How solar-friendly is your state?
CNET recently ranked states based on their residential solar policies: the laws and regulations affecting consumer-level solar panel installation and adoption. These policies play a major role in determining how accessible and affordable a solar panel system is to the average resident.
Each state was evaluated through a methodology and scored based on eight categories. The final score was converted to a letter grade.
Here's how your state scored on CNET's solar policy test.
Colorado
Grade: D
Incentives available:
- State-governed net metering at fraction of retail rate
- Solar panel systems fully exempt from property taxes
- Solar panels fully exempt from sales taxes -- not applicable to other solar equipment
- Statewide low-income rooftop solar and community solar programs
Strongest scoring categories:
Colorado has statewide low-income rooftop solar and community solar programs, which makes it another state that has opened up affordable and accessible options to get solar energy for more homes. Solar equipment is also fully exempt from property taxes in the state, while only the solar panels themselves are exempt from sales taxes.
Categories to improve:
No state solar tax credit means the initial investment into solar will cut deeper into residents' wallets, and net metering at a fraction of the retail rate will extend the solar payback period before Coloradans start seeing savings on that investment.
How to pay for solar panels in Colorado
Solar panels are a big investment. Several financing options make the upfront cost of solar more affordable. As with any major purchase, you will want to think about how to finance the cost of solar panels. Bear in mind that the money from the tax credit won't be yours until after you've filed your taxes for the year the panels are installed. It's also important to factor in the solar payback period, which is the time it takes to recoup your upfront investment and when savings begin.
Here are some ways to pay for solar panels:
Solar loan: Your solar installer likely has a relationship with a bank or other financial institution to offer a loan designed for solar panels. This can be a great deal, but you'll want to get multiple offers to ensure the rates and terms are the best.
Lease or power purchase agreement: Some solar companies allow you to lease your system or enter a power purchase agreement. If you choose to lease, you won't own the solar system, you'll just pay for the use of the equipment. Entering a power purchase agreement means you'll buy solar energy generated from the solar company to power your home. The price you'll pay is usually lower than the retail rate from your local utility company. Note that not all incentives are available with a lease or power purchase agreement.
Cash: This approach only works if you happen to have thousands of dollars sitting around in a bank account. If you don't have that yet, but want solar panels in the future, consider saving money in a high-yield savings account. Interest rates are high right now, and this can help you save faster.
Home equity: You don't have to use a loan from your solar company. Financial institutions offer home equity loans and lines of credit (or HELOCs) that are commonly used for home improvement projects. These loans can be used for basically any purpose, and they may be a good fit for your solar project. Shop around and make sure you're getting the best deal.
Personal loan: You can also borrow money through a personal loan. The main difference between a personal loan and a home equity loan is that a personal loan is typically unsecured, which means your house isn't at risk. The downside is they tend to have shorter terms and higher interest rates than home equity products.
Read more: Just looking for an emergency backup? Check out portable solar panels and solar generators.
Installation factors to consider
Before signing a contract with a solar installer, you should consider whether solar panels are the right choice for you and your home. Here are some installation factors to consider:
Is your roof right for solar? The age, shape, size and slope of your roof impact how efficiently a solar panel system generates energy. The Department of Energy says solar panels will generate the most electricity on roofs with a slope of between 15 and 40 degrees. Older roofs or roofs in need of repairs should be maintained or replaced before solar installation occurs.
Are solar panels allowed in your neighborhood? In Colorado, homeowners' associations aren't allowed to ban solar panels. However, your homeowners' association or neighborhood may have requirements or approval processes that you should consider before signing a contract.
Can you add solar panels to your insurance policy? Most standard homeowner insurance policies cover rooftop solar panels. However, you should still check with your insurance agency for the specific details of your policy.
Does your home receive enough sun? While solar panels can generate some electricity in indirect sunlight, direct sunlight of at least 4 hours per day is a general rule of thumb for when they make financial sense. In Colorado, many residents receive significant snowfall in the winter. Solar panels are designed to operate in the snow, although they will produce less power if it remains cloudy. If your roof gets consistent shade coverage, a solar panel system may not generate as much power as you'd like.
Do you rent your home? If you rent your home you may not be allowed to install solar panels. If this is the case, community solar programs are an alternative option. Community solar allows residents to subscribe to solar power produced in another location (usually somewhere nearby) and receive a credit on energy bills. The subscription rates are lower than the value of the credits, meaning you pay less than you would on normal energy bills.
How we evaluate solar companies
The companies we listed above as "the best" are curated from CNET's best solar companies list. Companies making the best list are scored on the equipment, warranties and customer service they offer. Then, we make sure these recommendations are available in your state. You can read a full breakdown of how we review solar companies here.
Companies listed under the local installers were chosen in a less rigorous way. We chose them because they offered something unique or notable to customers in the state, they seemed well-regarded by internet reviewers or because they were one of the few installers we could find information on in the state.
Whether we've completed a full review on a company or not, it's always a good idea to get multiple quotes from different installers before choosing a company.
Colorado solar power FAQs
Is solar power good for the environment?
Solar power is a more sustainable source of energy compared to coal or gas because it doesn't emit greenhouse gases like carbon dioxide. Burning fossil fuels is a major contributor to climate change and air pollution. Scientists say we need to quickly transition away from fossil fuels and rely more on green energy sources in order to avoid the worst effects of climate change. While manufacturing solar panels does have environmental impacts, they have a much lower impact over their lifetime compared to the continuous burning of fossil fuels.
Does Colorado have a solar tax credit?
There are a variety of solar tax credits, rebates and incentives available in Colorado. The federal solar tax credit gives you 30% of the price of a solar system back on your taxes and is offered in every state. Colorado also offers several solar incentives at the state and local levels. Check the Database of State Incentives for Renewables and Efficiency for a full list of Colorado solar incentives.
How can I find a solar installation company in Colorado?
With a growing number of solar installers operating in Colorado, it can feel overwhelming trying to pick the right one. Take the time to do your research before signing a contract with an installer. Read customer reviews, check installers' warranty terms and compare multiple quotes from installers. You can use CNET's picks for top solar companies as a starting point.