Is solar worth it in Denver in 2026?

A roof in Denver produces about 1,577 kWh a year per kW of panels. For a home with a $150 monthly bill, a 6.8 kW system costs about $24,576 at Colorado's median price and pays for itself in roughly 13.7 years, with no federal tax credit.

Data checked 2026-10-21 · Estimates, not a quote

Solar output in Denver

1,577kWh per kW a year

Source: PVGIS, NSRDB data

Colorado residential electricity price

16.7¢per kWh

Source: EIA, 2026 year to date

Median installed cost (US), 2025

$3.60per watt

Source: Berkeley Lab

Calculator · 2026 data, no federal tax credit

How long would solar take to pay for itself?

StateAverage monthly electric bill$Installed cost per watt (state median; use your quote)$Value of solar power vs. retail rate (why)%

Simple payback

13.7 years

System size: 6.8 kW
Installed cost: $24,576
Savings, year one: $1,800
Net over 25 years: $17,825

Sized to cover your yearly use at today's price. Panels lose 0.5% a year; prices held flat. Method

How Denver homes get paid for solar

Export rules are set at the state and utility level, not by the city. Denver is under Colorado's full net metering: Xcel Energy and other investor-owned utilities in Colorado credit rooftop solar exports at the retail energy rate; the PUC kept this in place in 2015 and SB21-261 widened it in 2021. The full rules, incentives and sources are on theColorado page.

Denver: your utility, incentives and permits

Main utility: Xcel Energy. Checked 2026-10-21 against the sources below.

Denver’s electricity comes from Xcel Energy, under a 20-year franchise agreement with the city that expires on December 31, 2026. A new agreement negotiated by the city and Xcel goes to Denver voters on the November 2026 ballot.

What Xcel gives you for exported power

Every Xcel solar customer is net metered. When the panels make more than the house uses, the surplus goes to the grid and is held in a virtual solar bank that is applied to future bills. Xcel asks each solar customer to choose what happens to that bank, Rollover or Waive, on its Solar Bank Election Form: read both before you sign, because they treat a surplus differently. On a time-of-use rate, credits are tied to when they were produced, so on-peak solar earns more; on the flat rate every kWh credits the same.

Xcel caps the system so its expected output is no more than 200% of your consumption over the previous 12 months.

Incentives in 2026

Solar*Rewards, income-qualified homes only. Xcel pays an upfront $3 per watt to income-qualified customers and $0.50 per watt to homes in a disproportionately impacted community, for systems up to 10 kW AC, by check within 60 days of permission to operate. It pays $0 per kWh of production. On October 6, 2026 the program had $1,179,334 left of its $2,050,000 budget for the year. Other homes get net metering but no Solar*Rewards payment.
Batteries. Renewable Battery Connect pays $250 per kW of battery output, up to $5,000, plus a $100 annual participation incentive.
No property tax on the system. Colorado exempts home solar systems of up to 100 kW AC that mainly power the house.
City group buy. Denver runs a solar group buy; the city says participants can save up to 10% compared with the average installation cost.
Colorado Solar for All is on hold because of recent developments at the federal level.

Permits and connection

Every system needs an electrical permit from Denver Community Planning and Development, applied for online through e-permits. Licensed electricians can get a quick permit through SolarAPP+ for single-family and duplex homes with service of 400 amps or less and a system under 10 kW DC. Systems of 10 kW and over need stamped, engineered plans. A zoning permit is also needed if the panels are not flush with the roof or are on the ground. The city charges a $50 flat fee per solar permit and no plan review fee. Homeowners can apply without a contractor if they meet the homeowner permit rules.

The installer usually files the interconnection application in Xcel’s portal. Xcel says it can take 12 to 16 weeks if the grid needs no upgrades, and recommends not starting construction until the application is fully approved. The Colorado state page has the statewide rules.

Sources

Why the city matters

Two things change from one city to another in the same state: the sun, which sets how many panels you need, and the utility, which sets what exported power is worth. Denver gets 1,577 kWh per kW a year on a south-facing roof at a 20° tilt, so covering a year of use for a $150 bill at 16.7¢ takes about 6.8 kW, roughly 18 panels of 400 W. Electricity prices in the calculator are the Colorado residential average; your utility's rate can be higher or lower, so put your own bill in.

Method: how we calculate payback. Compare all states in theranking or size a system with the panel calculator.