Are Solar Panels Worth It in 2025? A Full Guide

With rising electricity costs and growing concerns about sustainability, many are asking, are solar panels worth it? The answer depends on various factors, but one thing is clear—solar energy is more accessible than ever. As technology advances and government incentives continue, more households are considering the switch. However, myths and misconceptions often cloud the decision-making process. In this guide, we break down the costs, savings, and key factors to help you determine if solar is the right choice for you.

Cost of Installing Solar Panels in Australia

The cost of installing solar panels has changed drastically over the years, driven by advancements in technology, lower manufacturing costs, and government rebates. However, the price varies depending on the system size, location, and state-specific incentives.

Here is a summary of the typical installation costs for solar systems across various cities in Australia. The prices include the upfront Small-scale Technology Certificates (STC) rebate but exclude any additional state-based incentives.

In the early days of solar adoption, costs were upwards of $5–$10 per watt, limiting solar power to the more affluent. However, the government’s Small-scale Technology Certificates (STC) rebate, which offers up to 40% of the system cost, has made solar more accessible. Over the last five years, prices have dropped considerably, and installation methods have become more efficient, helping to lower costs further.

As of 2025, costs are rising again, partly due to higher electricity and production costs. However, with the federal STC rebate continuing to decrease, the cost of solar power in Australia is likely to continue rising in the coming years.

How Much Can You Save With Solar Panels?

A typical 6.6kW solar panel system in 2025 costs anywhere between $5,500 and $8,500. Over the life of the system, you can expect savings between $1,200 and $2,000 annually. This will depend on how much electricity you use, when you use it, and whether you’re able to consume the solar power you generate. If you consume most of the power during the day when the sun is out, your savings will be on the higher end of the scale. The payback period for such a system generally ranges from 4 to 7 years.

For homeowners, investing in solar panels means not only reducing your electricity bill but also contributing to a more sustainable future. However, some still question why solar panels are not worth it for certain households. Let’s take a closer look at government rebates and incentives for solar power to better understand the benefits.

Government Rebates and Incentives for Solar Panels

Government incentives play a crucial role in making solar power more affordable for Australians. From federal to state-based rebates, these incentives can reduce the upfront cost of installing solar panels and batteries, helping to lower home solar panels cost for many homeowners.

New South Wales (NSW)

In NSW, the federal government offers an STC rebate of around $2,160 for a 6.6kW system. Additionally, the state government offers rebates for solar batteries, with discounts ranging from $760 to $2,400. Feed-in tariffs in NSW range between 5c and 15c per kilowatt-hour, depending on your electricity provider. Low-income households may also be eligible for up to $350 in electricity rebates.

Victoria

In Victoria, the STC rebate for an 8kW system is approximately $2,240. Other incentives include a Victorian Solar Panel Rebate, which offers up to $1,400 off the cost of a new system or the upgrade of systems older than ten years. Additionally, interest-free loans of up to $1,400 are available.

Queensland

Queenslanders can benefit from the federal STC rebate ($2,160), as well as feed-in tariffs. The Community Solar Banks program in Townsville and Caloundra offers shared solar arrangements that reduce electricity bills.

Other States and Territories

Other regions such as Western Australia, South Australia, Tasmania, and the ACT also offer various incentives, including rebates for solar batteries, electric vehicles, and home energy storage systems. These incentives help answer the question is solar electricity worth it for homeowners looking to reduce long-term energy costs.

Are Solar Panels Worth It for You?

When considering whether is it worth getting solar panels, several variables come into play. Let’s dive into these variables to determine if solar power is a good investment.

1. Lifetime Solar Savings

It’s important to consider the long-term benefits of solar power. While the upfront cost of installing solar panels may seem high, they have a typical lifespan of 25 years. During this time, your system will continue to generate savings, offsetting the initial investment. Cheap systems may offer a quick payback but are more likely to fail and require replacement sooner, making them a less reliable long-term investment.

2. Self-Consumption is Key

One of the best ways to maximize your savings with solar is by consuming the energy you generate directly. By doing so, you save around 30c per kilowatt-hour, which is much higher than what you would earn from feed-in tariffs. The average feed-in tariff is between 4-10c per kWh, meaning that relying on grid usage for excess energy will result in less savings.

3. Roof Orientation and Space

Even if your roof doesn’t face directly north, you can still benefit from solar. East/west-facing roofs can still generate substantial power during peak hours when electricity costs are higher. Additionally, if you have limited roof space, investing in more efficient bifacial solar panels (which capture sunlight from both sides) may be a smart move.

4. Low Energy Users

Even if you’re a low-energy user, solar panels can still be a great investment. While your ability to make savings may be reduced, higher feed-in tariffs in some regions can speed up the payback period, making solar power a worthwhile investment for most households.

5. System Size

Different types of solar panels are available, and choosing the right one depends on your energy needs. A typical 5kW or 6.6kW system is sufficient for many households. However, with the rise of electric vehicles and increasing demand for home electricity, opting for a slightly larger system may provide better value in the long run.

6. Should You Wait?

While solar panel prices have dropped over the years, government rebates are also decreasing. If you’re debating is solar power worth it in 2025, it may be better to invest now rather than wait for uncertain future incentives.

For those who want more flexibility in their setup, the EcoFlow 400W Portable Solar Panel can be a great option. This portable solar panel offers a high 23% conversion, charging quickly and efficiently. This ensures optimal performance whether you’re supplementing your home system or powering devices during travel, camping, or outdoor activities. Its solar panel efficiency allows you to capture more energy in various situations, ultimately speeding up your return on investment. Start saving on energy today with the right solar setup!

Conclusion

In 2025, the question are solar panels worth it depends on your energy needs, location, and available incentives. With rising electricity costs, solar remains a smart investment for most Australians. If you’re also considering energy storage, you might ask are solar batteries worth it? With available rebates, they can provide extra savings and security.

FAQs

What is the payback time for solar panels?

The payback time for solar panels is typically 4 to 7 years, depending on factors like electricity usage, system cost, and feed-in tariffs. Higher energy consumption during the day and government incentives can shorten the payback period. With rising electricity prices, solar panels continue to be a smart long-term investment for many homeowners.

How much does it cost to install a 6.6 kw solar system?

A 6.6kW solar system in Australia costs between $5,500 and $8,500, depending on the brand, installer, and location. This price includes the federal solar rebate, which reduces the upfront cost. While cheaper systems are available, investing in a high-quality system ensures better performance, durability, and savings over time.

Is it still worth getting solar panels in Australia?

Yes, solar panels are still worth it in Australia. With high electricity prices, generous government rebates, and abundant sunlight, solar offers significant savings on power bills. Advances in solar panel efficiency also make modern systems more effective. Whether for homes or businesses, solar remains a cost-effective and environmentally friendly energy solution.