Streamlining rooftop solar permitting could cut costs by 61%

Permit Power finds that by reducing bureaucratic barriers to residential solar, nearly 20 million more families in the U.S. could install solar by 2040, leading to $1.2 trillion in lifetime bill savings.

October 27, 2025 Anne Fischer

SunPower residential rooftop solar installation.

Image: SunPower

A recent report by Permit Power, As Cheap as Our Peers: How cutting red tape can lower the cost of rooftop solar and offset rising utility bills finds that by cutting the red tape in rooftop solar permitting, almost 20 million more families would install solar by 2040.

Solar in the U.S. costs up to seven times more to install than in Australia and Germany, according to the Permit Power report. It estimates that in the U.S. the median cost is $28,000 for a 7 kW system, whereas it would be $4,000 in Australia and $10,000 in Germany. These high costs are impediments to adoption, the report notes, with just one in ten families in the U.S. having solar, compared to one in three in Australia.

Prior to the passage of the One Big Beautiful Bill Act (OBBBA), people in the U.S. were incentivized to go solar with a 30% tax credit; however, that credit ends at the end of 2025.

The high cost of solar comes at a time when utility bills are rising faster than inflation, with that trend expected to continue, according to Permit Power. The report notes that while one in seven households are living in energy poverty, most cannot afford the high cost of solar, which would help cut their energy costs. Rooftop solar can reduce electricity bills by over 80%, according to the report.

The report finds that if U.S. households could buy rooftop solar at the same price as Australian or German households, almost 20 million more would install solar by 2040. Permit Power estimates they would see average annual bill savings of $1,600, resulting in aggregate electricity bill savings of $1.2 trillion over the lifetime of these additional rooftop solar systems.

Reducing bureaucratic barriers, particularly rooftop solar permitting, inspection and interconnection processes, will reduce installation costs in many areas in the United States, the report finds.

“There is strong research that shows how unnecessary bureaucratic barriers raise the cost of rooftop solar and home batteries in the United States,” said Talor Gruenwald, Research Director of Permit Power and author of the report. “This is the first research that shows the enormous benefits that would accrue to American families if we removed those bureaucratic barriers and brought the costs of home solar and batteries down to levels in other peer countries.”

According to OpenSolar, a solar design and permitting software specialist, soft costs account for 78% of the total installed cost for residential solar. These can include what the report describes as “costs and delays associated with outdated and cumbersome approval processes, such as varying and convoluted permitting requirements across localities, differing requirements between plan reviewers and inspectors within the same jurisdiction, and unresponsive and bureaucratic utility interconnection processes that can stop projects being turned on for months after they have been completed.”

The solution

The report outlines ways in which policymakers can cut the bureaucratic red tape:

Adopt instant permitting software or qualified third party permitting to issue instant permits for standard residential solar and battery projects.
Use remote inspection protocols that allow code compliance to be verified through photos or video submissions for routine residential installations.
Implement automatic utility interconnection approvals for qualifying residential systems that use smart inverters and meet established technical screens.
Update outdated local government and utility requirements that mandate the installation of unnecessary and expensive hardware and prevent the use of modern cost-saving technology.
These and other policies to cut red tape would enable 23% of U.S. households to get rooftop solar by 2040, according to the report.

[Also read “Simplify solar volunteer campaign launches across the U.S.“]

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