U.S. solar system pricing rises for utility and commercial projects as residential costs decline

If you're thinking about putting solar panels on your roof, the cost picture actually improved a bit. New pricing data for the second quarter of 2026 shows residential solar system costs dropped 1.4% from a year earlier, averaging $3.36 per watt for a complete, ready-to-use system. That's the one bright spot in an otherwise pricier solar market.

Commercial solar rose 5.6% to $1.77 per watt, and utility-scale systems (the large solar farms that feed power to the grid) also got more expensive, up between 0.9% and 2% depending on the type of mounting used. The reason costs are climbing almost everywhere except homes: panel prices themselves are actually falling, but those savings are being eaten up by higher costs for the metal racking, wiring, and shipping needed to build a system. Steel, aluminum, and copper have gotten pricier due to tariffs, and freight costs have jumped as oil and gas prices rose roughly 50% since the Middle East conflict began.

For homeowners, the falling panel prices trace back to the reversal of certain federal tariffs on imported solar components earlier in 2026, which cut residential panel costs by 16% year-over-year to $0.37 per watt. Utility-scale projects didn't see the same relief because many developers are paying extra for U.S.-made panels to qualify for federal incentives tied to domestic manufacturing. If you're weighing a home solar installation, this suggests equipment itself is getting cheaper, even though other costs in the industry are rising.