Solar is the one trade on this list where the market changed underneath the pricing. The 30 percent federal residential tax credit under Section 25D was terminated, with residential systems needing to have been installed and operational by 31 December 2025 to qualify and no phase-down after it. Owner-purchased residential demand is contracting as a result, and a price built on the assumption that a third of the customer's cost comes back to them is a price built on something that no longer exists. Everything below assumes you are pricing into that market rather than the one before it.
Start with the stack
Labor, payroll burden, materials, a share of overhead, then profit as its own line: How to price your work so you actually make money and What Should I Actually Charge?. This page is the solar-specific part.
The credit change is the first thing in the price
Say it plainly to customers, because somebody else will not. The residential clean energy credit at 30 percent under Section 25D was terminated by legislation signed on 4 July 2025, and to qualify a residential system had to be installed and operational by 31 December 2025. Signing a contract or pulling a permit did not count. There was no phase-down.
For pricing, that has three effects:
Residential owner-purchase demand is softer, so the same system is a harder sell at the same number, and there is real pressure to discount into it. Discounting into a contracting market is how a business ends up busy and insolvent, which is the whole argument in Why you should never be the cheapest bid, and what a cheap price tells the customer.
The segments that still have wind behind them are commercial, utility-scale and third-party-ownership work, and those are priced completely differently from a residential cash sale. Commercial work brings retainage, payment terms, submittals, insurance limits and sometimes bonds, all of which are in Pricing residential vs commercial work: what actually changes.
Anything you say about incentives is a claim about somebody's money. State, utility and local programs still exist and they change. Quote the system, not the incentive, and if you mention a program at all, name it, date it and tell the customer to verify it with their own tax advisor. A sales pitch built on a credit that is withdrawn later becomes your problem.
More than one license, which is a cost most people underprice
A full rooftop install often needs more than one license. In most states the wiring and interconnection require an electrician's or electrical contractor license under NEC Article 690, and in several states the roof penetrations and racking require a roofing or general contractor license as well.
That is a genuine pricing input. Either you hold both, in which case the cost of holding and renewing them belongs in your overhead, or you sub one side, in which case another business's margin is inside your number. Pricing a rooftop install as if it were a single-trade job is the most common structural mistake in the trade. Do I Need a Contractor License? and How to become a solar installer have the licensing picture.
NABCEP is usually not the legal license, and in practice it is close to essential for competitive work, because utilities, inspectors and commercial specifiers look for it. Treat it as a credential that wins work rather than one that permits it, and carry its cost in overhead.
Three approvals, not one, and each one is calendar time
A solar job is not finished when the panels are on. It usually needs the building permit and inspection from the authority having jurisdiction, then utility interconnection approval, then permission to operate. Those are separate processes with separate queues that you do not control.
Price the administration as work, because it is. Someone has to prepare the application, answer the queries, schedule the inspection, and chase the utility. And be careful how you sell the timeline: a customer who was told six weeks and is waiting on a utility in week twelve is a customer withholding a payment. Say in writing that utility and jurisdiction timelines are outside your control, and tie your payment schedule to your own milestones rather than to permission to operate.
The roof is a risk you are taking on
You are putting fixings through somebody's roof and taking responsibility for what happens there. That means:
- Assess the roof and say what you assumed. Price the install on a sound roof of a stated remaining life, and exclude repair, reinforcement and replacement.
- Be explicit about the existing roof warranty. Penetrations can affect it, and the customer needs to know that from you rather than from their roofer.
- Say who owns leaks, and for how long. This is the claim that actually happens in solar, and a workmanship warranty on penetrations is a real commitment that has to be priced.
- Removal and reinstall for a future roof replacement is not included unless you say it is, and it is worth quoting as an option so the customer knows it exists.
Fall exposure drives the insurance side
Rooftop work carries the fall exposure that makes roofing the most expensive workers comp class in the country, and solar sits close to that neighborhood rather than to interior electrical. Comp is a rate per $100 of payroll by class code multiplied by your experience mod, and a clean safety record is one of the few levers you genuinely control. Workers' comp for contractors, Workers' Comp Estimator and How much insurance do I need, and how do I cut the premium? are the detail, and When do I need fall protection, and what counts? is the rule the crew works under.
General liability, and often higher limits than a residential-only contractor carries, is the other half. On commercial solar the contract sets the limits and they are not negotiable.
Equipment, and the money you carry
Panels, inverters, racking and increasingly storage are most of the material cost, and you buy them before the customer pays. That is a cash-flow position as much as a pricing one: a deposit sized to your equipment purchase, staged payments against your own milestones, and a hard look at what you can float. Deposits and progress billing has the structure and the state deposit caps, and Managing cash flow in a feast-or-famine trade has the reserve.
Equipment markup is doing the same work as in any trade: carrying the cost, the logistics, the returns, and the warranty relationship. And be careful with warranty language in the quote, because a solar customer is buying a twenty-year promise from three different parties. Separate the panel warranty, the inverter warranty and your workmanship warranty explicitly, and do not let your sales material imply you are backing all three.
What belongs in a solar quote
- A production estimate with its assumptions stated, and no guarantee of savings you cannot control.
- The roof condition assumption, and the exclusion of repair or replacement.
- Which approvals are outside your control, and what happens to the schedule if they run long.
- The three warranties, separated by who gives them.
- Electrical scope: service upgrade, main panel replacement or derate, and who does it.
- Tree trimming, shading changes and anything structural.
- Removal and reinstall if the roof is replaced later, quoted as an option.
- What happens to the incentive claim if a program changes, which is not your risk to carry.
Where to go next in this section
- How to price electrical work, the trade that owns the interconnection side.
- How to price roofing work, the trade that owns the penetrations.
- Pricing residential vs commercial work: what actually changes, since commercial and utility-scale is where the demand went.
- Why you should never be the cheapest bid, and what a cheap price tells the customer, which matters most in a contracting market.
- How to become a solar installer, for the licensing and NABCEP picture.
- Deposits and progress billing, for carrying the equipment cost.
Common questions
Did the federal solar tax credit really end?
Yes. The 30 percent federal residential clean energy credit under Section 25D was terminated by the law signed on 4 July 2025, and a residential system had to be installed and operational by 31 December 2025 to qualify. Signing a contract or pulling a permit did not count, and there was no phase-down afterwards. For pricing that means owner-purchased residential demand is softer and a quote that assumes a third of the cost comes back is quoting something that no longer exists. Say it plainly to customers, and verify the current federal and state position before you put any incentive in writing.
Is solar still worth pricing for in 2026?
It depends entirely on the segment. Owner-purchased residential is contracting after the credit ended, while commercial, utility-scale and third-party-ownership work remain viable. Those segments are priced differently: they bring retainage, longer payment terms, submittals, higher insurance limits and sometimes bonds, so moving into them is a change to your cash position and your paperwork rather than just a change of customer. The wrong response to a softening residential market is to discount into it, because a contracting market plus a thin price is how a busy solar business runs out of money.
What licenses do I need to install solar?
Usually more than one. In most states the wiring and interconnection require an electrician's or electrical contractor license, and in several states the roof penetrations and racking require a roofing or general contractor license as well, so a full rooftop install often needs both. That is a pricing input, not just a compliance one: either you hold both and carry the cost of maintaining them, or you sub one side and another business's margin is inside your number. NABCEP is generally not the legal license but is close to essential competitively, because utilities, inspectors and commercial specifiers look for it.
How should I handle utility interconnection delays in a quote?
Assume they will happen and price and word the quote accordingly. A solar job usually needs three separate approvals: the building permit and inspection, utility interconnection, and permission to operate, each with its own queue that you do not control. Say in writing that jurisdiction and utility timelines are outside your control, tie your payment schedule to your own installation milestones rather than to permission to operate, and price the administrative work of preparing applications and chasing responses as real work, because it is. The alternative is carrying a withheld payment while waiting on somebody else.
Who is responsible if the roof leaks after a solar install?
You are, for your penetrations and your workmanship, and that is a commitment worth pricing rather than assuming. Quote the install on a roof of stated condition and remaining life, exclude repair, reinforcement and replacement, and tell the customer in writing that penetrations can affect an existing roof warranty. Then separate the three warranties explicitly in your paperwork: the panel manufacturer's, the inverter manufacturer's, and your own workmanship warranty on the mounting and flashing. Customers routinely assume one party is backing all three, and that assumption is the source of most solar disputes.
The honest bit
- No dollar figures appear here, per watt or otherwise. Solar pricing moves with equipment cost, segment and region, and a published number would mislead.
- The Section 25D termination and its 31 December 2025 installed-and-operational deadline are as recorded in this site's own solar guide. Verify the current federal and state position at irs.gov and with your own tax advisor before repeating any incentive to a customer.
- State, utility and local incentive programs change frequently and independently of the federal credit. Never quote one without naming it, dating it, and telling the customer to confirm it.
- Which licenses a rooftop install needs is a state question and sometimes a local one. Confirm both the electrical and the structural side for the jurisdiction you are working in.
- Workers comp class codes and rates are set per state and per carrier. The point here is that rooftop exposure sits near the expensive end, not a number.
- This is general guidance, not legal, tax or financial advice.
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