The technology that converts sunlight to electricity has been around for decades &#; it&#;s triggered an incredible revolution in the alternative energy realm.
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But despite this incredible technology being around for so long, solar systems have remained generally expensive until the s. Still, vast technological improvements have occurred over the years across solar components. And as a result, we&#;ve seen drops in costs across both residential and commercial systems.
Will solar panels get cheaper? Let&#;s take a closer look at past costs, current costs and future projections so we can better answer the question.
[Related: 51 of the Most Popular Uses of Solar Energy in Daily Life]
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Within the past 15 years, solar energy has scaled to a point where installing solar panels isn&#;t just a luxury for the wealthy. Now it&#;s much more common for medium-income households and a broad range of businesses to invest in solar panels and enjoy solar&#;s benefits.
These days, solar panels are less expensive, better quality and far more accessible. With rising national energy rates and a greater desire to gain energy independence, solar has become quite popular. And rightfully so!
However, every rose has its thorn.
In the case of going solar, inflation and supply chain issues have been the thorns. We saw a temporary increase in the cost of solar installations in and . But overall, the cost of solar has been trending downward and has become even cheaper since .
Now let&#;s look at some of the factors driving lower solar panel costs, including the impacts of the Inflation Reduction Act (IRA).
Will solar panels get cheaper in ? We&#;ll explore the question in a minute.
Thanks to rapid advances in solar technology, we&#;ve seen increased solar panel efficiency levels across the board. For one, Maxeon (previously SunPower)® solar panels are some of the most efficient panels on the market &#; and we at Freedom Solar Power provide them.
But why is efficiency so important? Well, higher efficiency means that a single solar cell can generate more electricity. As a result, you see greater efficiency within each panel and then your solar system as a whole.
In turn, you need fewer panels to meet your energy needs, which saves you substantial long-term costs. Plus, you have a better chance of furthering energy goals like these:
We&#;ll illustrate how solar has gotten cheaper:
For clarity, a 50-KW solar system produces enough power to eliminate $600 from your monthly electric bill. In this scenario, a solar system quickly pays for itself and generates thousands of dollars in energy savings over its projected 25-year life span (a well-maintained system can last much longer).
However, the average cost per kilowatt hour (kWh) directly correlates with your solar panel system&#;s size. Regardless of size, the cost of a residential solar system decreased approximately 80% from to .
And that makes solar a viable energy alternative for average energy consumers like you.
[Related: How Many kWh Does a House Use Per Day?]
While and saw higher solar panel costs due to rising material costs and supply chain issues, most experts predict solar will get cheaper.
According to a November report by the National Renewable Energy Laboratory (NREL), extreme conditions in the solar market might have increased the installation cost of an average-size residential system (7.9 KW) by up to 15% by January .
However, inflation is falling. More people are learning how to install solar panels thanks to Biden&#;s huge federal investment in alternative energy sources via the IRA. Supply chain problems are easing as well.
In , before the pandemic and extreme conditions hit the solar market, Bloomberg predicted the overall cost of solar would drop by 34% by . With available tax credits and relevant solar rebates and incentives, you&#;re looking at some serious savings!
The bottom line is that solar panels will continue to get cheaper.
As a refresher, Congress passed and Biden signed the IRA in .
This legislation expands the solar ITC to 30% and keeps it in place through . After that, the tax credit will decrease and possibly phase out altogether.
In sum, the IRA creates 10 years of relative certainty in the solar market.
The sustained 30% tax credit lowers installation costs and makes solar panels more affordable for the average homeowner. What&#;s more, solar installers can hire more staff, and manufacturers can more safely make long-term investments.
This growth and stability will likely translate into further future cost savings!
[Related: Going Solar? Government Incentives That You&#;ll Appreciate]
If you&#;re considering going solar, you need to determine your energy needs and goals, then choose the right system size. Particular states provide additional rebates and incentives to reduce the cost of a solar installation, which you&#;ll also need to explore.
But remember: If you wait too long, you might lose out on the 30% solar tax credit! Incentives come and go, so now is the time to move.
Are you interested in learning more about All In One Solar Power System? Contact us today to secure an expert consultation!
When you&#;re ready to make the jump, contact Freedom Solar. Call (800) 504- or complete our online inquiry form, and one of our energy consultants will be in touch!
Featured image via Pixabay
The evolution of residential solar over the last decade has been astonishing, to say the least. In , solar panels are cheaper and more efficient than ever!
Solar panels becoming more affordable will be a key player in the expansion of residential solar, contributing to the combat against climate change - and higher efficiency ratings can help keep costs down and guarantee customers will be getting the best outcomes possible!
Let&#;s take a look at how solar panel cost and efficiency have changed over time.
Solar panels are about 60% cheaper and 40% more efficient than they were in .
Solar panels in cost about $8.70 per watt and were about 15% efficient.
Today, solar panels cost about $3.00 per watt on average and are between 19% and 22% efficient.
The price of solar panels could continue to drop, but it can depend on technology, market conditions, and government policies and programs.
Data from the National Renewable Energy Laboratory (NREL) documented that residential solar panel installations cost about $8.70 per watt in , meaning the average 6 kilowatt (kW) solar installation in cost about $52,200 before any incentives.
Today, the average cost for an installation that size today is around $18,000, less than half of the price in !
The price of solar has crept up slightly since , which could be attributed to the COVID-19 pandemic, increased solar financing costs, and supply chain issues.
However, it was reported in the SolarReviews Solar Industry Survey that 54% of installers say the price they paid for solar panels went down in . Additionally, 69% of respondents reported seeing improvements in supply chain issues from the previous year.
The truth is &#; it depends!
Historically, we have seen solar costs decline and deployment expand through policies and government programs that invest in and incentivize solar. The higher the demand for solar, the cheaper it's gotten.
The expansion of solar can heavily rely on political leaders, federal funding, and other factors. With the recent funding announced for &#;Solar For All&#; by the Biden-Harris Administration, there is projected to be more solar distributed to low-income families and communities.
Also, with the help of the Inflation Reduction Act (IRA) in , more incentives, such as the extension of the federal tax credit, have been created to further subsidize solar installation.
Keep in mind! Solar panel modules themselves aren&#;t the only &#;cost&#; factored into getting solar. Solar inverters and other soft costs, including installation, permitting, and inspections, are also included in residential solar installation costs.
The first ever functioning rooftop solar panels were installed atop a New York City rooftop in &#; and had an energy conversion rate of a mere 1%.
By , solar panels had efficiency ratings of around 15%. Nowadays, most monocrystalline solar panels have efficiency ratings between 19% and 22%.
The first-ever functioning solar panels on a New York City rooftop were just 1% efficient! Source: Smithsonian Magazine
In the last decade, solar panel efficiency has come a pretty long way. Back in , news broke that solar manufacturer, First Solar, had set the world record for the most efficient PV solar cell at 20.4%. Over ten years ago, record-breaking efficiency now falls within the industry standard thanks to new and evolving solar technology.
In fact, many homeowners get solar quotes using panels that are over 22% efficient! Popular high-efficiency solar panel brands include:
Solar technology is constantly evolving. It&#;s a huge possibility that we will see even more efficient solar panels in the near future. TOPCon solar cells are highly efficient and were popular across and the start of . Perovskite solar cells are also a promising technology, with some scientists achieving cell efficiencies of almost 40%. However, perovskite won&#;t become mainstream until the manufacturing price goes down.
A solar panel&#;s efficiency rating tells you how good a solar panel is at turning sunlight into usable electricity. Therefore, the higher the efficiency rating, the more electricity a solar panel can generate.
Solar panel efficiency plays an important role in how much energy a solar panel produces. In fact, the experts at SolarReviews consider module efficiency as one of the factors when scoring the top solar panel brands for .
However, other specifications, such as the wattage rating and temperature coefficient, are also very important to consider when comparing solar panels. We also consider these data points in our solar panel scoring criteria.
In , the average cost of a solar installation is about $19,000, or $3.00 per watt, before any incentives are factored in.
The industry standard for efficiency is between 19% and 22%, but we&#;re beginning to see more panels with efficiency ratings above 22%. Some are even close to breaking 23%!
Data from Solar Energy Industries Administration (SEIA) predicts that the U.S. solar fleet will nearly quadruple by the end of . With such high demand, we could see prices continue to steadily drop. However, elected officials will also play a role in the expansion of solar &#; so the future is not entirely certain.
If you are curious about solar being right for your home, putting your information into our solar calculator can help you get a better idea of what you can expect when you install solar.
Calculate how much solar panels will cost to install on your roof today
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