Rising Costs, New Regulations, and Major Federal Incentive Changes
As we approach the end of the year, many Bay Area homeowners are asking whether now is the right time to install solar panels or add home battery storage. A common assumption is that solar pricing will eventually drop, similar to consumer electronics or appliances.
But the reality is different.
Due to tariffs, domestic manufacturing requirements, Foreign Entity of Concern (FEOC) rules, rising labor costs, and changes to federal incentives for residential solar ownership, solar and battery costs are widely expected to rise rather than fall in the coming years.
Here’s what homeowners should understand before locking in their solar pricing.
Federal Solar Incentives for Homeowners Are Changing (IRC §25D)
For homeowners purchasing solar or battery systems through direct ownership (cash or loan), the federal residential clean energy credit under Internal Revenue Code §25D has been one of the strongest incentives available.
Historically, this incentive has applied to:
- Solar panel systems
- Home battery storage
- Labor and installation
- Permitting and inspections
- Required electrical upgrades
However, under current law, this incentive is scheduled to end for residential direct ownership unless Congress acts.
That means homeowners who delay may lose a significant federal incentive entirely, regardless of future equipment pricing or utility rate increases.
Solar Prices Are Not Going Down - Here’s Why
Tariffs Are Increasing Equipment Costs
Federal tariffs on imported solar equipment continue to impact pricing across the industry, including:
- Solar panels
- Inverters and microinverters
- Optimizers
- Battery systems
As manufacturers absorb higher import costs, those increases are passed through to installers and ultimately homeowners.
Domestic Manufacturing Rules Add Cost Pressure
The push to manufacture solar equipment in the United States strengthens long-term supply stability but raises near-term costs.
According to the National Renewable Energy Laboratory (NREL), domestic-content compliant solar systems currently cost more to produce due to higher manufacturing, materials, and compliance requirements.
These rules affect:
- Solar panel manufacturers
- Inverter suppliers
- Battery manufacturers
- Racking and mounting hardware
As U.S. factories scale up, pricing is expected to remain elevated rather than decline.
Source: NREL, “Preliminary Cost Impacts of Domestic Content Requirements for Solar PV Systems”
FEOC Rules Reduce Available Supply
New Foreign Entity of Concern regulations restrict the use of components tied to certain countries within solar and battery supply chains. This impacts:
- Battery cell sourcing
- Inverter components
- Solar module manufacturing
With fewer eligible suppliers, equipment availability tightens and pricing pressure increases.
Labor, Permitting, and Insurance Costs Are Rising Across the Bay Area
Beyond equipment costs, installation expenses continue to rise due to:
- Skilled labor shortages in electrical, roofing, and solar trades
- Higher workers’ compensation and insurance premiums
- Increasing permit and plan-check fees across Bay Area jurisdictions
These are structural cost increases that are unlikely to reverse.
The Myth: “Solar Will Be Cheaper If I Wait”
Solar pricing did decline rapidly over a decade ago as manufacturing scaled globally. That trend has changed.
Today’s solar costs are driven by:
- Tariffs
- Domestic manufacturing compliance
- FEOC supply chain restrictions
- Labor and insurance costs
- Local permitting and utility requirements
Because these inputs are increasing, most industry analysts expect residential solar pricing to rise rather than fall over time.
Why Locking In Pricing Now Makes Financial Sense
Even if installation occurs later, securing a contract price now protects homeowners from future increases.
By locking in pricing today, homeowners can avoid:
- Future tariff-related equipment increases
- Domestic manufacturing cost pressures
- Supply chain limitations
- Higher labor and permit fees
- Loss of federal incentives tied to direct ownership
Once a contract with Infinium is signed, pricing is secured regardless of future industry changes.
HDM & Participate Prepaid Solar Options
HDM Prepaid and Participate are prepaid solar energy options that allow homeowners to make a one-time upfront payment in exchange for long-term access to solar power at a predictable rate, without directly owning the system. These programs are designed for homeowners who want energy cost stability and protection from future utility rate increases, without ongoing monthly payments or escalators. An Infinium energy consultant can help determine whether a prepaid structure is the right fit based on your home, usage, and long-term goals.
Infinium Solar, Roofing & Electric: Your In-House Advantage
As one of the few Bay Area contractors that performs solar, roofing, and electrical work fully in-house, Infinium provides:
- Faster permitting and scheduling
- Better price stability
- Consistent installation quality
- No subcontractor handoffs
- Direct access to long-term support and warranty assistance
This integrated model protects homeowners from delays, coordination issues, and pricing surprises common with subcontracted providers.
Final Thoughts: This Is the Time to Act
Between changing federal incentives and rising industry costs, the current window remains one of the strongest opportunities for homeowners to install solar or battery storage.
If you’ve been considering solar, securing pricing now can protect you from future increases while preserving today’s available incentives and financing options.
Schedule your free site visit today:
https://infiniumsolar.com/contact