Solar 101

Introduction to Solar Energy: How It Works and Why It Matters.

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The Comprehensive Guide to Solar Energy in Colorado

Solar power has emerged as a leading renewable energy source, offering numerous environmental and economic benefits. As the world continues to transition towards sustainable energy solutions, several U.S. states have taken impressive strides in promoting solar power generation.

Colorado, known for its majestic mountains and abundant sunshine, is one of the best places in the United States to harness the power of the sun and embrace solar energy. As the state continues to prioritize renewable energy, more and more residents and businesses are turning to solar power to reduce their carbon footprint and lower energy costs.

In this comprehensive guide, we will explore everything you need to know about solar energy in Colorado, including the cost of solar installations, available tax breaks and incentives, the number of solar companies, and the state’s commitment to a sustainable future.

Abundant Sunshine and Optimal Solar Potential

Colorado boasts an average of 300 days of sunshine annually, making it a prime location for solar energy generation. The state’s high altitude and clear skies contribute to an exceptional solar potential, which means that solar panels installed here can produce more electricity compared to other regions with less sun exposure. This abundant sunshine provides an excellent foundation for maximizing solar efficiency and reaping the benefits of clean and renewable energy.

The Cost of Solar Installations in Colorado

The cost of solar installations in Colorado can vary depending on the size of the system, the type of solar panels used, and the complexity of the installation. As of my last update in September 2021, the average cost of a residential solar PV system in Colorado ranged from $2.50 to $3.50 per watt before any financial incentives. For a typical 6 kW solar system, this would amount to around $15,000 to $21,000 before incentives.

It’s important to note that solar costs have been steadily decreasing over the years due to technological advancements and increased demand for solar installations. Additionally, the availability of federal and state incentives can significantly reduce the upfront costs of going solar, making it a more financially feasible option for Colorado residents.

Solar Tax Breaks and Incentives

Colorado offers a range of tax breaks and incentives to promote solar energy adoption and make it more affordable for homeowners and businesses. Some of the key incentives include:

Federal Solar Investment Tax Credit (ITC):

The Federal ITC provides a tax credit of a percentage of the total solar system cost for residential and commercial installations. As of my last update, the ITC offered a 26% tax credit, but this percentage may have changed since then. It’s essential to check the latest updates to determine the current percentage.

Colorado Solar and Wind Equipment Sales Tax Exemption:

Colorado provides a sales tax exemption for solar equipment purchases, which can further reduce the upfront costs of going solar.

Property Tax Exemption:

Solar installations in Colorado are exempt from property tax assessments, ensuring that homeowners don’t face an increase in property taxes due to their solar systems.

Net Metering:

Colorado has robust net metering policies that allow solar system owners to receive credits for any excess electricity they generate and feed back into the grid. These credits can offset the electricity consumed from the grid during periods of low solar generation, effectively reducing electricity bills.

Performance-Based Incentives (PBIs):

Some utilities in Colorado offer PBIs, where solar system owners receive payments based on the amount of electricity their systems produce over time. PBIs can further enhance the financial benefits of solar energy.

The Rise of Solar Companies in Colorado

The growing interest in solar energy in Colorado has led to the proliferation of solar companies across the state. These companies offer a range of solar services, from initial consultations and solar system design to installation and maintenance. The number of solar companies in Colorado continues to increase, providing consumers with a competitive market and a wide array of options to choose from.

With numerous solar companies in the state, it’s crucial to research and select a reputable and experienced installer to ensure the proper design and installation of your solar system. Reading reviews, checking customer testimonials, and verifying licenses and certifications are essential steps in finding the right solar company for your needs.

The Importance of Solar Policies and Initiatives

Colorado has demonstrated its commitment to a sustainable future by implementing various policies and initiatives to promote renewable energy and combat climate change. The state has adopted ambitious renewable energy goals, including generating 100% of its electricity from renewable sources by 2040.

Additionally, the Colorado Energy Office (CEO) plays a crucial role in advancing renewable energy and energy efficiency in the state. The CEO collaborates with public and private entities to develop and implement programs that support renewable energy adoption, making solar energy more accessible and economically viable for residents and businesses alike.


Colorado’s abundant sunshine, coupled with a range of tax breaks and incentives, has positioned the state as a leader in solar energy adoption. As the cost of solar installations continues to decline and the number of solar companies increases, more Coloradans are taking advantage of this clean and renewable energy source to power their homes and businesses.

With a commitment to a sustainable future and a strong focus on renewable energy initiatives, Colorado is paving the way for a cleaner and greener energy landscape. By embracing solar energy, residents and businesses in the Centennial State can not only reduce their environmental impact but also enjoy long-term savings on their energy bills while contributing to a more sustainable future for generations to come.