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Solar Panel Prices: Will They Ever Drop?

It doesn't take an expert to see that when solar prices drop, adoption becomes much faster and more accessible, too. However, it also doesn't take a pro to see that raw material logistics and local manufacturing quality have a huge say in how solar panel prices work.

On average, a full system that can power an entire home costs about $17,000 - $29,000, a large discount compared to the prices of efficient solar panels three decades ago. Despite the lower price, it isn't low enough to maintain adoption in virtually any neighborhood.

The material used in solar panels also determines their cost. For example, a thin-film solar panel is affordable for most homes, but they are delicate and can suffer from damage faster than their expensive counterparts. As an alternative, crystalline PVs are much better in terms of performance and durability despite their higher acquisition costs.

The lower cost of having a full-fledged solar panel for less is still an ongoing trend that's going slow but surely. The increasing number of manufacturers, continuous research into perovskite and alternative crystalline panels, and other activities show market interest has not dwindled in producing quality yet affordable panels.

For an accurate look on pricing, here's where we stand right now according to The Solar Nerd.

If you’re interested in solar and renewable energy, you’re probably aware that the price of wind and solar technologies have dropped by an incredible amount over time.

There are a couple questions that homeowners who are thinking of going solar often have. The first is: Is solar power getting cheaper? And other is: If solar is getting cheaper, should I wait before installing solar panels on my house?

President Biden issued executive actions to suspend some tariffs on solar panels, and to authorize the use of the Defense Production Act to accelerate the domestic production of parts for solar panels. See details below.

The price of solar panels, inverters, and lithium batteries has gotten cheaper over the past 10 years. Prices are expected to continue to drop over the long term.

However, the cost of solar installation will not drop at the same rate because hardware costs are less than 40% of the price tag for a home solar setup. Don’t expect home solar to be dramatically cheaper in the future. In fact, your cost may increase as local and federal rebates expire.

Recent shortages in key raw materials, especially polysilicon, have actually caused the price of solar panels to rise in the past year. While this trend is expected to be temporary, it does illustrate that solar panel prices can fluctuate.

Bottom line: if you’re thinking of adding solar to your home, waiting probably isn’t going to save you money. Install your solar panels now, especially because tax credits do expire.

The pandemic caused chaos in the price of everything, from toilet paper to pork chops. The prices of raw materials for solar panels were affected too, especially polysilicon, which is used to make silicon cells.

And it’s not just polysilicon, but silver, copper, and solar glass. We’re seeing a shortage of many materials due to a high global demand for solar panels.

At the start of 2021, the price of polysilicon was $11/kg, but skyrocketed to $28.50/kg by summer. The price as of June 2022 has reached about $34.50/kg. Yikes!

Good news for solar demand means bad news for prices

After a brief pause during the pandemic, global demand for solar is climbing again and is projected to increase for the rest of the year. That’s great for the solar industry and climate change!

However, it’s not so good for prices, which are already constrained by supply chain issues. China continues to be the global leader in solar deployment and is expected to represent 36% of global demand this year, followed by the European Union at 22%, with the United States coming in third at 12%. The war in Ukraine may accelerate demand in the EU even further as it tries to deploy more renewable energy to compensate for the ending of Russian natural gas imports.

The bottom line? We should expect global demand for solar to continue for the foreseeable future. (Continue reading here to learn more)

Count on Roper Roofing & Solar to provide top-notch solar panel installations and GAF Timberline Solar Shingle certified installations for your property. Call us today to learn more and get started with your new solar panel installation.

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