You may be surprised to learn just how affordable solar has become.
After all, just a decade ago it was seen as nothing but a dream for a very select few. But today it's an entirely different story. So much so that Warren Buffet has invested over $7 billion in the solar industry and it's estimated that rooftop solar panels could generate nearly 40% of U.S. electricity.
So why has the cost of solar fallen so rapidly? It’s fairly straightforward and can be broken down into two halves: the cost of the actual solar equipment, and the so-called “soft-costs.” The equipment costs include solar panels, an inverter, racking equipment, and wiring. The “soft-costs” include things like permitting, operations, monitoring, and the actual labor needed for installation.
Cost of Solar Panels
Solar “Equipment Technology” on the Rise
When solar panels first came onto the market in the early 1970s, the average cost to produce one watt of solar-generated electricity was over $100. In 2016, the same watt of power cost only $0.45 from a solar panel. The reason? PV technology is improving at an exponential rate in terms of cost effectiveness for the energy produced.
Solar “Soft-Costs” on the Decline
A past survey of over 200,000 PV installations in the United States concluded that installation costs (including everything but the price of the panels) dropped by 38 percent for systems producing 10 kW or less. These declining “soft costs” coupled with advances in equipment make now a perfect time to consider going solar.
Reaching the Cost Tipping Point
A generation ago, the cost of solar panels was so great that it cost 100 times more to produce one kilowatt of energy from solar power than it does today. And while costs will continue to fall, favorable rebates and tax incentives are set to expire soon, meaning today may be your chance to get the best deal on solar panels for your home.