Installing a solar system still provides significant financial and environmental benefits in 2025. With more than 3.8 million Australian homes now equipped with rooftop solar, solar adoption continues to rise due to increasing electricity costs and decreasing solar installation prices.
In the Blue Mountains, the average rooftop now receives approximately 4.2 peak sun hours per day (up from 3.5 due to improved tracking data and climate factors). This means that a 1kW solar PV system will generate an estimated 4.2kWh per day on average, while a 5kW system will produce about 21kWh per day. These figures will be higher in summer and lower in winter.
The benefits of solar power in the Blue Mountains
Installing a solar system saves households and businesses money, increases their degree of energy independence, and reduces carbon pollution. Thanks mainly to their attractive value proposition and growing familiarity, however, solar systems have become immensely popular throughout Australia over the past few years, with the number of homes with rooftop solar surpassing 1 million.
Thanks to the abundance of sun in Australia, solar is an excellent prospect for fuel-free power production. Averaged over the course of a year, the average rooftop in the Blue Mountains will receive approximately 3.5 ‘peak sun hours’. This means that a 100% efficient solar photovoltaic (PV) system in the Blue Mountains will generate 3.5 kilowatt-hours (kWh, units) of solar energy for every kilowatt (kW) of system capacity. A 1kW system will therefore generate 3.5kWh of electricity (on average) per day, while a 2kW system will generate double that–7kWh/day. A 5kW solar system will generate about 17.5kWh/day. These figures, as averages, will actually be higher in the summer and lower in the winter, of course, as the length of the day varies.
Average Solar Panel Prices in the Blue Mountains (2025)
Latest Solar Choice Price Index figures for Sydney and the Blue Mountains:
| System Size | Average Price (Incl. STCs) |
|---|---|
| 3kW | $3,550 |
| 4kW | $3,890 |
| 5kW | $4,280 |
| 6kW | $4,720 |
| 7kW | $5,550 |
| 10kW | $7,120 |
These average prices are taken from the solar choice price index and the of solar systems costs in Sydney
Electricity Consumption vs Solar System Energy Generation in the Blue Mountains
The cost of electricity from the grid has increased, with Blue Mountains residents now paying 28–35c/kWh in some cases. Meanwhile, the average feed-in tariff in NSW has dropped, ranging between 4–6c/kWh in 2025. This further reinforces the importance of maximizing self-consumption of solar power rather than exporting excess energy to the grid.
The decreasing cost of battery storage solutions (with many home batteries now under $500 per kWh of capacity) is making energy storage more accessible for households seeking greater independence from the grid. However, for most homeowners, using solar power during the day remains the most cost-effective strategy.
Read more: What solar system size is right for you?
Federal incentives for solar power in the Blue Mountains
The Small-scale Renewable Energy Scheme (SRES) remains in place in 2025, but STC values have reduced as the scheme phases out (scheduled to end by 2030). Currently, customers can expect STCs to provide an upfront discount of approximately 50–60c per watt of installed solar capacity—slightly lower than in previous years.
Despite this, solar system prices have continued to decline, making it more affordable for Blue Mountains homeowners to install solar panels.
Read more: Solar system installation prices in Australia
Let Solar Choice help you find the best solar power deals in the Blue Mountains
Working with over 100 solar installers across the country, Solar Choice makes it easy for homes and businesses to compare solar installation prices anywhere in Australia–including the Blue Mountains. Fill out the Solar Quote Comparison request form to the right of this page or call us on 1300 78 72 73 to talk to one of our brokers. Our services are 100% free to our customers.
© 2012 Solar Choice Pty Ltd
Top image by JJ Harrison via Wikipedia
