Denver, CO Solar: 2026 Costs, Incentives & Savings

Solar Power in Denver

With over 300 days of sunshine each year, Denver is one of the best places in the country for solar panel installation. In fact, Colorado ranks 9th in the nation for residential solar, and it’s easy to see why more Denver homeowners are making the switch.

Rising energy costs matter, too. Colorado electricity prices have climbed 22% from 2020 to 2024. To see how solar could work for your home, our guide to home solar panels is a great place to start.

COLORADO by the Numbers

9th Most residential solar in the United States

161 Households have installed solar panels

5.6 Avg peak sun hours per day

~$58k Denver average savings over 25 years

How Much Do Solar Panels Cost in Denver, CO?

See what solar really costs in Denver. This calculator uses actual installation data from thousands of local homes—including Aurora, Lakewood, Centennial, and Littleton—not estimates. Enter a few details to get a clear, personalized picture based on real projects right here in your community.

System Size

This system size is designed to offset approximately 100% of the average electricity usage for a home of this size in Colorado.

Recommended System
6.56 kW
Your Monthly Payment
Estimated monthly cost with LightReach
$77/mo
As low as
$77/mo

Why Lease Solar?

Following the 2025 Big Beautiful Bill, the federal 30% solar tax credit is no longer available for cash purchases. With a LightReach lease, Palmetto owns the system and still qualifies for the commercial ITC — passing those savings through to you via lower monthly payments.

• No upfront investment
• Palmetto handles all maintenance
• 90% Production Guarantee
• Comprehensive protection program included

Cost Breakdown

Your estimated investment
System Cost
$19,534
Price per Watt
$2.98
Final
Cost
$19,534

Savings

Your total financial benefit
Monthly Savings
Average utility bill reduction
$132
Payback Period
Break-even point
10.5 years
25-Year
Savings
$57,602

Get Your Personalized Quote

Key Takeaways

• Denver gets over 300 sunny days a year, making it one of the best cities in the country for solar, with 5.6 peak sun hours daily.
• Colorado electricity prices rose about 15% from 2021 to 2024, so generating your own solar power helps Denver homeowners gain more control over rising energy costs.
• Colorado offers strong solar incentives, including a state sales tax exemption, full retail-rate net metering, and Xcel Energy rebates that lower your upfront cost.

Denver Electricity Prices

With over 300 days of sunshine a year, Denver is a prime spot for solar—and rising electricity costs make the timing even better.

Electricity prices keep climbing. In Colorado, rates rose from about 13.1 cents per kWh in 2021 to 15.1 cents in 2024—roughly a 15% increase in just three years.

Solar installation in Denver offers a way to take control. By generating your own power, you can rely less on the grid and reduce the impact of these steady rate increases on your monthly bill.

Price of Energy: Colorado vs National Average

0¢
10¢
20¢
30¢

13.7¢
13.1¢
15.0¢
14.2¢
16.0¢
14.3¢
16.5¢
15.1¢

Denver Area Utility Providers

In Denver, most homes get electricity from Xcel Energy or CORE. In 2023, Xcel charged about 14.3¢ per kWh and CORE about 14.5¢—both close to Colorado’s 2023 state average of 14.3¢.

These 2023 rates sit below the national average of 16.0¢ per kWh. Colorado’s mix of hydro, wind, and natural gas helps keep local prices slightly lower than what many U.S. households pay.

Denver Utilities Electricity Rates

Colorado Solar Incentives

Colorado offers a range of solar incentives in Colorado that help Denver homeowners lower the cost of going solar.

These programs include a statewide sales tax exemption on solar equipment, net metering credits for the energy you send to the grid, and rebates from local utilities and cities.

Together, these state and local incentives make solar more affordable for Denver homeowners. The table below breaks down each program available in your area.

Colorado provides a full state sales tax exemption on the purchase of qualifying solar energy equipment, meaning homeowners in Denver pay zero Colorado state sales tax (2.9%) on their solar installation. Qualifying components include solar modules, inverters, mounting racks and structures, wiring, control systems, and other components directly related to the solar installation.

This exemption is applied automatically at the point of purchase — you don’t need to file a separate application. On a typical Colorado residential solar installation costing $25,000–$35,000, the state sales tax exemption saves approximately $725–$1,015 in upfront costs.

Note that this exemption covers Colorado state sales tax only. Local city and county sales taxes may still apply depending on your municipality.

Colorado law requires all investor-owned utilities — primarily Xcel Energy and Black Hills Energy — to offer net metering to residential solar customers. Denver is served by Xcel Energy. Under this policy, you receive a full retail-rate credit for every kilowatt-hour your solar system exports to the grid, the same rate you pay to purchase electricity. This is one of the strongest net metering policies in the country.

Xcel Energy allows net-metered solar systems sized up to 200% of your annual electricity usage. Excess credits roll forward automatically to the next billing cycle. At the end of each calendar year, customers can choose to roll remaining credits into the next year indefinitely, or request a cash payout at Xcel’s Average Hourly Incremental Cost rate. Customers can also opt to receive kWh-based credits applied to future bills instead of cash.

Locking in net metering now is advantageous because homeowners who go solar today lock in current policy terms for the life of their interconnection agreement. States like California have already moved away from full retail crediting, and waiting carries regulatory risk on top of paying higher electricity bills in the meantime.

Xcel Energy’s Solar*Rewards Program provides upfront solar rebates to eligible residential customers in Denver and across Colorado. The 2026 program opened on May 21, 2026 with a renewed incentive budget. Customers who qualify as Income Qualified or residing in Disproportionately Impacted (DI) Communities can receive an upfront rebate of $1 per watt of installed solar capacity, up to 10 kW AC. For a typical 5 kW system, this equals a $5,000 rebate — a significant reduction in upfront costs.

In addition to the upfront rebate, Solar*Rewards also offers a production incentive of approximately $0.02 per kWh generated by your solar system, paid over a 20-year contract term. Enrolling sooner locks in the current rate for the full contract period, as this per-kWh rate may decrease in future program years.

To apply, contact Xcel Energy or visit their official website before installation, as pre-approval is typically required. Eligibility is based on income relative to Area Median Income (AMI) or residence in a designated Disproportionately Impacted community within Xcel’s Colorado service territory.

Denver Solar Irradiance

Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Understanding how seasons affect your solar system helps set realistic expectations for your investment.

Denver’s high elevation and abundant sunshine—over 300 sunny days yearly—make it excellent for solar. Cold, clear winters actually boost panel efficiency, so production stays strong across every season here.

Solar Production in Denver by Month

System Sizes: 5 kW, 7 kW, 10 kW
Daylight Hours
Energy Production (kWh/day)

What Can Your Solar System Power?

Summer Production (July)

In July, your 10 kW system could power:

• 3.4 average homes (15 kWh/day per home)
• or Run central AC for 17 hours AND power all other appliances
• or Fully charge 5.1 Tesla Model 3 electric vehicles

Winter Production (December)

In December, your 10 kW system could power:

• 2.1 average homes (15 kWh/day per home)
• or Keep your home heating system running for 15 hours
• or Fully charge 3.1 Tesla Model 3 electric vehicles

Annual Production

Over a year, your 10 kW system could:

• Offset 11 tons of carbon dioxide emissions
• or Equal the environmental benefit of planting 192 trees

Solar Panel Systems in Denver

We’ve mapped solar installations across the country, right down to the neighborhood level. Explore this interactive map to see how many Denver homes have made the switch to solar. Click any hexagon to discover how your neighbors and local communities are embracing clean energy.

Leasing Solar Panels

In Denver, you get your electricity from Xcel Energy, and the good news is that a Power Purchase Agreement (PPA) is available in your area. A PPA is different from a standard solar lease. Instead of paying a fixed monthly amount, you simply pay a set price for each kilowatt-hour (kWh) your panels produce. Since your system makes more power in Denver’s sunny summers, your solar payments naturally rise and fall with production.

Compared to paying cash, a PPA means no large upfront investment and no maintenance to manage yourself. With Palmetto’s LightReach program, we own and care for the system, so you can enjoy the savings without the hassle. Learn more in our buy or lease guide.

Go solar without the investment

With LightReach, there are no investment costs to recoup, loan payments to manage, or maintenance needs to take on. As soon as your panels are active, your solar savings are too!

Frequently Asked Questions

Does Denver, CO have net metering?

Yes. Denver homeowners served by Xcel Energy have access to net metering. Under Colorado law, investor-owned utilities credit residential solar customers at the full retail rate for excess electricity sent to the grid, and these credits carry over month to month as a dollar credit.

Do solar panels increase your home value in Denver, CO?

Yes, in Denver a purchased or owned solar panel system can increase your home’s value. A Zillow study found homes with solar panels sold for about 4.1% more than comparable homes without them.

How much does it cost to go solar in Denver, CO?

With Palmetto’s LightReach lease, Denver homeowners can go solar for a low fixed monthly payment—starting around $77/mo—with no upfront cost. Palmetto owns and maintains the system, so there’s nothing to install or repair out of pocket.

How does leasing solar work and what’s the approximate cost in Denver, CO?

With Palmetto’s LightReach lease, you make one simple monthly payment that covers your solar system, installation, monitoring, maintenance, and a protection program with a 90% Production Guarantee. There’s no upfront cost, and your payment is typically less than your current Xcel bill—so you can save from day one.

Do solar panels require maintenance in Denver, CO?

Yes, but solar panels are low maintenance. Denver’s clean, dry air and occasional rain or snow keep most systems performing well with little effort from homeowners.

Is solar worth it financially?

For many Denver homeowners, solar can make financial sense—especially with over 300 sunny days a year and electricity rates that rose about 15% from 2021 to 2024.

How much electricity can a solar system produce in Denver, CO?

In Denver, a typical 10 kW home solar system produces roughly 15,900 kWh per year, based on NREL PVWatts data for the area. Smaller systems generate less—about 8,000 kWh for a 5 kW system and 11,200 kWh for a 7 kW system.