Solar panels in Colorado: cost, payback and the rules that matter
Colorado homes pay 16.7¢ per kWh for electricity, the 22nd highest of 51, up 8.0% in a year. A typical home needs 13 panels. With no federal tax credit they pay for themselves in about 11.1 yrs.
Four facts that decide solar in Colorado
1. The sun. One kilowatt of panels makes about 1,636 kWh a year in the median Colorado city, from 1,589 in Fort Collins to 1,723 in Pueblo.
2. The price of electricity. Every kWh your panels make is worth what you would otherwise pay: 16.7¢ in Colorado today.
3. What your utility pays for exports. Most Colorado utilities still credit exported solar close to the retail rate, but rules differ by utility and change often.
4. Incentives. The 30% federal Residential Clean Energy Credit (IRC §25D) ended for systems whose installation is completed after December 31, 2025 (One Big Beautiful Bill Act, P.L. We don't know of a statewide income-tax credit for home solar in Colorado.
Colorado's homes
2,374,218 households; 66.2% own their home. 1,416,681 owner-occupied single-family houses: the main market for rooftop solar. The median home was built in 1988; 25.6% heat with electricity.
ACS 2020–2024 5-year estimates, U.S. Census Bureau.
Plan a specific Colorado home
Solar in every Colorado city with 50,000+ people
| City | Sun hrs/day | kWh per kW | Best tilt | Typical kW | Payback (NM) | Payback (NB) | Solar ¢/kWh |
|---|---|---|---|---|---|---|---|
| Denver | 5.7 | 1,642 | 39° | 5.5 | 11.0 yrs | 18.6 yrs | 9.6 |
| Colorado Springs | 5.9 | 1,694 | 38° | 5.0 | 10.7 yrs | 17.7 yrs | 9.3 |
| Aurora | 5.7 | 1,648 | 39° | 5.0 | 11.0 yrs | 18.0 yrs | 9.6 |
| Fort Collins | 5.5 | 1,589 | 39° | 5.5 | 11.4 yrs | 18.9 yrs | 9.9 |
| Lakewood | 5.7 | 1,643 | 39° | 5.0 | 11.0 yrs | 18.0 yrs | 9.6 |
| Thornton | 5.7 | 1,631 | 39° | 5.5 | 11.1 yrs | 18.6 yrs | 9.7 |
| Arvada | 5.7 | 1,633 | 39° | 5.5 | 11.1 yrs | 18.6 yrs | 9.6 |
| Westminster | 5.7 | 1,631 | 39° | 5.5 | 11.1 yrs | 18.6 yrs | 9.7 |
| Greeley | 5.6 | 1,601 | 39° | 5.5 | 11.3 yrs | 18.8 yrs | 9.8 |
| Pueblo | 6.0 | 1,723 | 38° | 5.0 | 10.5 yrs | 17.5 yrs | 9.1 |
| Centennial | 5.7 | 1,654 | 39° | 5.0 | 11.0 yrs | 17.9 yrs | 9.5 |
| Boulder | 5.6 | 1,618 | 39° | 5.5 | 11.2 yrs | 18.7 yrs | 9.7 |
| Longmont | 5.6 | 1,611 | 39° | 5.5 | 11.3 yrs | 18.8 yrs | 9.8 |
| Castle Rock | 5.8 | 1,667 | 39° | 5.0 | 10.9 yrs | 17.9 yrs | 9.4 |
| Loveland | 5.5 | 1,594 | 39° | 5.5 | 11.4 yrs | 18.9 yrs | 9.9 |
| Broomfield | 5.6 | 1,627 | 39° | 5.5 | 11.1 yrs | 18.7 yrs | 9.7 |
| Commerce City | 5.7 | 1,636 | 39° | 5.5 | 11.1 yrs | 18.6 yrs | 9.6 |
| Grand Junction | 5.9 | 1,681 | 37° | 5.0 | 10.7 yrs | 17.6 yrs | 9.3 |
| Parker | 5.8 | 1,660 | 39° | 5.0 | 10.9 yrs | 17.9 yrs | 9.5 |
NM = exports credited at retail (net metering); NB = exports at ~30% of retail (net billing). Systems sized to the Colorado average home. $3.00/W, cash, 25 years.
Rule changes that affect Colorado
All changes and deadlines →- Federal: In-service deadline for the lease/PPA solar credit · Tax credits
- Federal: National data: solar prices fell to a median $3.60 per watt · Prices
- Federal: Construction-start deadline passed for the lease/PPA credit · Tax credits
- Federal: The 30% homeowner solar tax credit is gone · Tax credits
Questions about solar in Colorado
How much do solar panels cost in Colorado?
A 5.5 kW system, the size the average Colorado home needs, costs about $13,750 to $20,625 before incentives in 2026.
Is solar worth it in Colorado?
In the median Colorado city, solar pays for itself in about 11.1 yrs if exported power earns the retail rate, or 18.6 yrs if it earns about 30% of retail. Most utilities here still offer some form of net metering; check yours.
Is there a solar tax credit in Colorado?
We know of no statewide income-tax credit for home solar in Colorado; utilities and cities sometimes offer rebates. The 30% federal credit ended for homeowner systems installed after December 31, 2025.
How many solar panels does a Colorado home need?
About 13 panels of 420 watts for the state-average 674 kWh a month. Sunnier cities need fewer: Pueblo gets 1,723 kWh per kW a year, Fort Collins 1,589.