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Tesla solar panels might be the most affordable option. Here's everything you need to know

The electric car company offers a strong warranty and top-of-the-line energy storage. It also promises to be the cheapest.

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In 2020, Tesla was the second largest solar panel company in the US by market share.

Tesla

More and more homeowners are turning to rooftop solar panels as a way to save money or address climate change. But solar panels represent a huge financial investment. While there are dozens of solar panel providers and installers around the country, it's worth looking at the major players.

While most people likely know Tesla as an electric car company, it took a major step into the solar business with its 2016 purchase of the solar company SolarCity, which was founded by cousins of Tesla CEO Elon Musk. It now installs solar panels and its unique Solar Roof in at least parts of 25 states and promises to match the prices of its competitors.

In 2020, Tesla was the second largest solar panel company in the US by market share, with 7.6% of the market as of the end of last year, according to the market analysis firm Wood Mackenzie. That means a lot of people are choosing Tesla for their solar panels. Tesla was beaten only by Sunrun, which is well ahead, with about 14% of market share at the end of 2020.

Tesla used to be an even more popular option, but the company took the unusual step to sell solar systems entirely online. (Most of the companies I've looked into require at least a phone call if not a site visit before quoting. Tesla offers by far the most pricing information up front.)

It's difficult to compare solar providers, since each rooftop installation will perform differently based on everything from the orientation of your roof to nearby tree cover to local weather from one day to the next. Below, I'll give you the essential information about Tesla's solar panels and, where possible, let you know how it stacks up to the competition. I'll stick with Tesla's panels here, and save the Solar Roof for its own (yet-to-come) article since it's so unique.

Note that the US Security and Exchange Commission is investigating a whistleblower claim that Tesla misled consumers when fixing fire hazards in its solar panel systems. More on that below.

Read more: Solar panels vs. Tesla solar roof: Biggest differences broken down

What do I get from Tesla solar panels?

Tesla offers four sizes of solar panel installations measured in kilowatts: 4.25, 8.5, 12.75 and 17kW. Tesla allows you to package your solar panel purchase with a Powerwall, its well-regarded battery system that can store power for use during surge pricing, outages or after the sun sets.

As you might expect, Tesla boasts about its panels' sleek, low-profile design. To my eye, Tesla's installations are indeed less obtrusive than others. If that's important to you, Tesla might have an advantage here.

Unless you're really particular about who manufactures your panels, what's really important is how long they'll last and how well they'll work. Tesla's warranty says your panels are guaranteed to work at 80% capacity for 25 years or it will replace them. That's roughly in line with other companies, though the specific details of the warranty aren't available online and Tesla, which dissolved its press office last year, did not respond to requests for comment. 

Tesla's first foray into solar power was not with panels, but with storage. Its Powerwall battery is still one of the top choices in the industry, to the point that other major solar companies offer the Powerwall with their installations.

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Tesla's warranty says your panels are guaranteed to work at 80% capacity for 25 years or it will replace them. 

Tesla, Inc.

Powerwall can hold 14 kilowatt-hours of energy. Tesla says it has the ability to power most appliances, though full use of larger 240-volt appliances like air conditioners and clothes dryers may require more batteries. How long 14 kilowatt-hours lasts depends on how much energy you use, but if you avoid using energy-intensive appliances like washers, dryers or air conditioners, it should last you a couple of days at least. (Keep in mind your solar panels will provide power during the day and possibly recharge your Powerwall, weather permitting.)

You can install Powerwall batteries indoors and outside of your home. They're roughly 6 inches deep, 2 and a half feet wide and almost 4 feet tall, so they shouldn't be difficult to tuck away somewhere.

The final bit of hardware is the Tesla solar inverter, which converts the direct current electricity your panels generate into alternating current that your house can use. A key metric here is efficiency. Tesla's solar inverter operates at 97.5% efficiency, according to the company. That puts it near the top end of what's typical.

When everything is up and running, you can monitor it all from the slick-looking app Tesla offers its users. Via the app you can monitor your energy production and usage. If you have a Powerwall, you can also customize how it operates. You can set how much charge you'd like your Powerwall to reserve for outages, boost its reserve when a storm is approaching, and adjust when you draw energy from your Powerwall based on time of day.

Are Tesla solar panels a good deal?

Each of Tesla's four offerings compare favorably to national averages for value measured in dollars per watt. According to the Lawrence Berkeley National Laboratory, the median price for residential solar in 2020 was $3.80 per watt. The value of Tesla's offering increases with size.

Tesla's online estimates usually come in well below that amount, even including one Powerwall (or two with the 17-kW option). With the suggested storage options and the federal tax credit (26% of the cost if you install through 2022), Tesla's estimates range from $3.32 per watt for the smallest option down to $2.23 per watt for the largest.

The prices Tesla spits out online might not be the final cost. Your $100 refundable deposit only starts the process. You may need to upgrade your electrical main panel or pay extra for hiding the conduit from your solar panels.

While the overall cost won't be clear until a bit later in the process, Tesla will match any installer who quotes you a lower price. If that quote comes within 14 days and is for an array of the same size or larger, Tesla will match the price on a dollar-per-watt basis. All you need to do is to email them the quote and your Tesla reservation number.

In early December, Reuters reported the SEC was investigating a whistleblower's claims that Tesla failed to notify customers of an issue that may have caused some solar arrays installed before 2018 to catch fire. The company launched Project Titan in 2018 to fix the issues, but was not upfront about the reason and did not offer to shut down solar panels to decrease the risks. Several of its solar customers have sued Tesla over fires. The SEC said that the ongoing investigation into Tesla does not mean it has found that Tesla broke the law, Reuters reported. Again, Tesla does not operate a press office to handle requests for comment.

Read more: Your solar panels can make you money. Find out when and how

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Does Tesla operate in my state? How do I order?

The only surefire way to know if Tesla's solar panels are available in your area is plug your address into its website and check. I found services in parts of 25 states. That means it's available in a few more states than some of the other major solar companies, like Trinity and Sunrun, though SunPower serves more.

The ordering process is fairly straightforward: Enter your address. Enter your average monthly electricity cost. Tesla will then spit out a suggested solar array and number of Powerwall batteries. It also provides an estimated cost and a visual mockup (though not of your house). You can add or remove solar panels and Powerwalls from your order and see how it will affect your estimated electricity usage and storage capabilities.

When you're satisfied with your setup, you can place your order with a refundable deposit of $100.

From here, you'll need to submit your utility bill and take a few pictures of your roof. Tesla uses that information and satellite imagery to design your system. 

While it may seem strange that Tesla doesn't send someone out to view your roof before designing your solar system, the idea here is to reduce costs. (While the price-per-watt cost of residential solar is falling, the price of panels, inverters and other hardware is falling faster than the soft costs like labor and site visits.)

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Tesla solar panel services are available in parts of 25 states.

Tesla

At this point, you'll sign a contract and installation moves ahead largely as it would with any installer. Permits are pulled. Tesla sets an install date (which can be rescheduled). A local team puts panels on your roof.

Your installation may be subcontracted to a certified installer. Tesla has in-house installation teams, but more and more it's relying on third-party installers to expand the reach of its tech. In particular, it certifies installers for the Powerwall and its other solar option, Solar Roof.

Although Tesla did not respond to requests for confirmation about its selection process for install teams, this is information you should be provided before you sign your contract, if it's important to you. 

You have a couple of backstops, too. You can cancel your contract within up to three days after you sign. Also, your final payment isn't due until the newly installed system passes an inspection by your local authority. You also have the option to return your system for up to seven days after it's fully functional. Some work won't be refunded or returned (like a Powerwall installation) and Tesla won't make cosmetic repairs to your roof after it removes panels. What is or isn't returnable and refundable will be detailed in your Energy Products Order Agreement, which you should read carefully before signing.

Is Tesla the best choice?

As with any major purchase, you should get multiple quotes from multiple companies. Make sure they answer all your questions and provide the information you need. While Tesla doesn't have a press office, its customer service representatives were easy to get in touch with and seemed knowledgeable. Still, it shouldn't be your only call.

Tesla's price match means it will always be competitive in terms of cost. Likewise, the estimates it provides online (which are only estimates) come in well below the national average. If the look of your panels is really important, Tesla's do sit closer to the roof and look sharp. Tesla also offers more information up front about its warranty than some of the other players. Still, make sure you can view it in detail before committing.

The Powerwall is widely considered an industry leader in batteries. It sets the Tesla's equipment apart, but it's also available from some other installers.

It's also important to note that I researched this as deeply as was practical and tried to provide the clearest answers, but I didn't go through the purchasing process, interact with customer service as a buyer or base my assessment of Tesla's performance on any first-hand experience. This category is a hard one to review in the traditional sense, so if possible, you'll want to make sure to get multiple estimates from the different providers in your area before you make a purchase decision.