
The Price of Solar Is Declining to Unprecedented Lows - tedsanders
http://blogs.scientificamerican.com/plugged-in/the-price-of-solar-is-declining-to-unprecedented-lows/
======
jasode
The article emphasizes that the declining price is due mostly to _peripherals
& installation_ rather than any scientific breakthroughs of the solar panels
themselves. The following quote is key:

 _> "This means that the decline in installed cost observed since 2012 was
largely caused by a decline in the cost of the inverters that convert the DC
power produced by solar panels to AC power for the grid and other “soft” costs
such as customer acquisition, system design, installation, and permitting."_

On another note, calculating the payback of residential solar panels is tricky
because many online calculators don't consider:

    
    
      - inverters failing and needing to be replaced (~10 years?)
    
      - bank of backup batteries need to be replaced (~10 years?)
    
      - significant increased labor costs of replacing the roof or repair roof leaks (roofers must spend extra time unmounting all panels before replacing shingles or tiles.)
    
      - paying a service to clean the panels if the house is in a dusty climate and the homeowner doesn't want to climb on the roof and do it himself
    

One can lump all those negative costs into one bucket called "ongoing
maintenance" to simplify things but nevertheless, it doesn't seem like many
ROI calculators properly account for them.

(That said, some people pay the premium for solar panels to gain _power
autonomy_ which overrides any over-optimistic estimates of installation
payback.)

~~~
pjc50
Stick with a grid-tie system for the time being, especially if you can get the
right feed-in tariffs. I don't really see the case for domestic storage
systems yet.

~~~
brightball
The biggest market for domestic storage is people who would want an emergency
generator anyway. You get most of the same benefit for a lower cost with a
Powerwall (if the expectation is temporary outage tolerance).

IMO that's the best comparison for domestic storage though.

~~~
dragontamer
> You get most of the same benefit for a lower cost with a Powerwall (if the
> expectation is temporary outage tolerance).

Ehh? A Powerwall costs $3500 alone, WITHOUT the inverter or transfer switch. A
Powerwall supplies 3.3 kW, which isn't enough to run a 3-ton air conditioning
unit (30 amps x 240 Volts == 7.2 kW).

If you run 15kW (air conditioner plus a few other stuff), you'll need FIVE
Power walls for a minimum price of $17500. (Plus the inverter, plus... etc.
etc.)

\----------

Or, you can get a 16kW generator AND switch for $3300.

[http://www.electricgeneratorsdirect.com/Generac-
Guardian-646...](http://www.electricgeneratorsdirect.com/Generac-
Guardian-6461-Standby-Generator/p13939.html)

\-------

Powerwall is actually a lot more expensive than standard generators. Something
like 5x more expensive.

~~~
Tharkun
Erhm, do you honestly expect to keep your A/C running during a power outage?
First world problems indeed..

Insulating your property to keep heat out/in is a hell of a lot cheaper than
buying enough backup power to keep your A/C running...

~~~
hibikir
It depends on where you live. About 15 years ago, the geniuses of our power
company decided that they could save on tree trimming near power lines. a few
years later, they were bragging about the savings... and then, in the middle
of winter, with about 3 feet of snow on the ground, we had an ice storm that
took out power for well over half the city. My house was without power for 4
days, with highs in the 20F. There's enough population density our lives were
not in danger, but the house was only habitable because we had a generator.

And guess what? 5 months later, the summer comes, the tree trimming still
wasn't done, and half the city lost power again due to a summer storm. Out for
6 days in our house. Every day we reached the 90s. Good luck insulating
yourself from that heat for almost a week! Having A/C was pretty nice. The
power company now inspects and trims around lines every couple of years, just
to avoid power outages so wide they can't bring power back at an acceptable
timeframe.

That said, the situation is rather regional: I'd not care about AC or heating
in a power outage if I lived in Northern California. Around here, where we can
hit the 100s in the summer and go under zero in the winter, you have to care a
bit. My friend in Alaska cares even more.

So first world problems? Depends on where you live.

~~~
lorenzhs
Relying on electricity for heating should be on the list of questionable
decisions, though. That changes the parameters of emergency planning
significantly.

We also had temperatures in the nineties for the last five days here, yet
nobody has AC in their home. It's not a big problem with insulation. Of course
we also don't have non-redundant overland power lines. Power outages we super
rare.

------
codecamper
If you liked the sound of this article, there is even better news:

* solar panel prices have dropped a whole lot in 2016 already. Chinese PV panels now cost about 43 cents a watt. Production costs are around 37 cents a watt. (that's for Jinko Solar)

* utility solar is seeing improvements in construction (more robots), cable management, medium voltage something or other at the power plant, etc.

* China PV makers are moving to PERC and maybe more to Mono. This means a little more efficiency. First solar supposedly has their CdTe response.

* be careful before you go and invest in solar. (FSLR, SPWR, JKS, CSIQ, JASO) As I learned, there is a coming shakeout in 2017. The long term extension of the ITC in the US ironically caused a slowdown in deployment b/c utilities are no longer under the gun to receive the ITC. China also lowered their subsidies for the second half of 2016. Meanwhile PV makers increased production.

~~~
Filligree
> * solar panel prices have dropped a whole lot in 2016 already. Chinese PV
> panels now cost about 43 cents a watt. Production costs are around 37 cents
> a watt. (that's for Jinko Solar)

However, a 140-watt panel would cost me 362 dollars back home, which is _250_
cents per watt:
[http://www.sunwind.no/product/show/?id=1297](http://www.sunwind.no/product/show/?id=1297)

Where exactly are these oh-so-cheap panels supposedly sold?

~~~
beefield
The usual place:

[http://www.aliexpress.com/item/solar-
panel-12v-50w-poly-2-pc...](http://www.aliexpress.com/item/solar-
panel-12v-50w-poly-2-pcs-lot-panneau-solaire-100w-18v-mini-off-grid-
solar/32663864355.html)

~~~
STRML
That seems great at 50 cents per watt, but the shipping is another 91 cents
per watt.

Good place to start looking though.

~~~
beefield
I have thought (never tried, though) that large shipping costs in Aliexpress
are indicator that supplier wants to discuss the true shipping cost with
buyer.

Note also that at least in EU you need to add customs and VAT. And you can't
expect always getting top quality if you order the cheapest you can find in
Aliexpress.

Again, in EU, it might be easier to buy e.g. this:

[http://www.ev-power.eu/Solar-Panels/Solar-panel-GWL-Sunny-
Po...](http://www.ev-power.eu/Solar-Panels/Solar-panel-GWL-Sunny-
Poly-260Wp-60-cells-MPPT-30V-OMP260.html)

(plus VAT, but already in EU)

------
danmaz74
Interesting:

> The continued decline in total installed cost is noteworthy considering the
> fact that the price of the solar panels (or modules) themselves has remained
> relatively flat since 2012. This means that the decline in installed cost
> observed since 2012 was largely caused by a decline in the cost of the
> inverters that convert the DC power produced by solar panels to AC power for
> the grid and other “soft” costs such as customer acquisition, system design,
> installation, and permitting.

~~~
nnain
That's right. A friend, here in India is making a decent income by selling
accessories - connectors, wire(sun/heat resistant), batteries etc. Importing
Solar panels in India or manufacturing is still with the bigger players. But
accessories is easy to get in. Also companies providing installation services
aren't all that profitable, because cost of labour is cheap here and the
margins are low. In installation you're basically only playing in the 15-20%%
of a crowded market. But if you consider the over manufacturing capacity of
China, accessories import/export/manufacturing remains a lucrative segment of
the business.

------
_ph_
This is great news, there should be a large push now to base large parts of
the grid on solar (and of course wind). Not accounted in the costs of
conventional power generation is all the environmental impact - factoring that
it, solar probably is already cheaper.

Another seldom mentioned fact is, that solar plants don't have a minimum size.
So for large regions in Africa, where there is no grid yet, it is much easier
to set up isolated small solar plants in villages than to construct a whole
grid.

~~~
gaius
There is environmental impact in solar too - the manufacturing processes for
photovoltaic cells aren't exactly clean, the raw materials still need to be
sourced, installations spread out over mile after mile need vehicles to
maintain etc etc.

But the real elephant in the corner of the room is that there is no really
good method yet for buffering power generated by solar by day, for consumption
overnight, when it is needed for lighting, heating, cooking, etc. A
conventional station doesn't care what time of day it is. THAT is the barrier
to widespread adoption, and it's one that solar proponents always seem to
overlook...

~~~
nl
I'll keep posting this until I see someone else on HN posting itbtoo: Flow
batteries are here now, cheap, and work well. They don't have the power
density of the Tesla batteries, but for residential and light industrial use
they work well.

~~~
marcosdumay
Flow batteries have two basic problems.

One is that they deal badly with usage intermittency - one must be always
charging or discharging them, you can't just store them.

The second is just, where do I buy one? Nobody seems to make them, no idea
why. Maybe this one solves itself when solar gets widespread, or maybe there's
some government hand in that and it won't be available when we need it.

~~~
nl
_One is that they deal badly with usage intermittency - one must be always
charging or discharging them, you can 't just store them._

That isn't really a problem in home use. You just run your power though them,
and dump any excess to the grid.

 _The second is just, where do I buy one? Nobody seems to make them, no idea
why. Maybe this one solves itself when solar gets widespread, or maybe there
's some government hand in that and it won't be available when we need it._

For industrial use [http://redflow.com/](http://redflow.com/), and just
starting to hit the residential market now

(Disclaimer: I work in the same building as a Redflow office)

~~~
gaius
I'm waiting for vanadium redox batteries to go mainstream myself
[https://en.wikipedia.org/wiki/Vanadium_redox_battery](https://en.wikipedia.org/wiki/Vanadium_redox_battery)

------
Animats
Note that the article is about big solar, not home solar. Big sites with lots
of sun and no clouds are very cost-effective. Mojave is filling up with solar
panels. Random house roofs, not so much.

The head of Applied Materials solar operations had a useful way of looking at
costs. He'd draw a latitude line on a map, saying that below this line
(Northern hemisphere) solar could beat out other sources of power without
subsidies. About ten years ago, that line ran through Spain and Southern
California. As the costs decline, it moves north. This is more useful than
looking at costs over all locations. Solar is a location-specific thing. SF's
BART system once looked into solar panels at stations, and decided that only
one station in the whole system (Contra Costa) got enough sun to justify it.

Tesla is making noises about "solar shingles" for residential installations.
The idea is to replace the roof, rather than sit on top of it. Others make
those now; CertainTeed Products, for one. Dow Chemical just exited that
business. Solar shingles work, but high installation cost and lower efficiency
make it unproductive.

~~~
erikpukinskis
I don't really see what the relevance of a foggy coastal city is to the
general solar market.

~~~
ee8aq3g5c6
Most of BART's above-ground stations are not located in a foggy city.

------
JumpCrisscross
Levelised cost of energy (LCOE) is a good metric for comparing energy sources
on cost [1].

According to the table on page 6 of this EIA report for weighted average LCOEs
in America before tax credits for 2022 [2], photovoltaics are projected to be
around $74 per MWh. That compares favourably with $100 for nuclear, but
unfavourably with $56 for natural gas, $59 for wind or $64 for hydroelectric.
(Solar gets a weighted average federal subsidy of $16/MWh subsidy; wind $8.)

[1]
[https://en.m.wikipedia.org/wiki/Cost_of_electricity_by_sourc...](https://en.m.wikipedia.org/wiki/Cost_of_electricity_by_source)

[2]
[https://www.eia.gov/forecasts/aeo/pdf/electricity_generation...](https://www.eia.gov/forecasts/aeo/pdf/electricity_generation.pdf)

------
makomk
So basically rooftop residential solar isn't going to be economically viable
any time soon - it's more or less bottomed out and is still much more
expensive than conventional generation and utility-scale solar, and the latter
has further potential for cost reductions.

~~~
Gibbon1
Thing to consider is when you compare costs you need to compare against the
alternative sources at the particular point and time where solar power is
injected.

A lot of times you see solar prices compared with base load power prices, but
solar competes actually with natural gas[1] fired peaking plants which sell
power at higher prices than a coal fired plant.

Similarly residential users are charged a substantially higher price for
electricity than the base load price. Partly because a substantial amount of
power comes from peaking plants and because the utilities have a grid to
maintain[2].

[1] If you wonder why the Koch brothers hate solar remember they are in both
the oil industry and the gas industry. Little of the former is used for power
generation where peaking plants use lots of natural gas.

[2] Utilities hate roof top solar because it messes with their economics
because their bond payments and maintenance costs are fixed.

~~~
deftnerd
Why do you place solar with peak-load technologies like gas? The point of peak
load plants, and why they charge a premium, is that they can ramp up output
when there is sudden demand. Solar does not have that ability, just like coal
and wind.

~~~
jdeibele
Guessing because the peak-load for electricity tends to coincide with very hot
days. So lots of demand for air conditioning but the solar panels are also
generating maximum capacity.

~~~
Tharkun
Not entirely true. PV panels perform better on cold sunny days than on hot
sunny days. Semiconductors and heat are still no match made in heaven...

------
jdeibele
I live in Portland. Lots of small, one-story houses being torn down and
replaced with something that has 2 more floors.

What surprises me is that roofing on these new homes isn't required to have a
south-facing exposure. Seems like that would make it a lot easier for homes to
add solar.

~~~
driverdan
Maybe they don't want solar or don't want their roof facing that direction.
Let people do what they want with their belongings. If south facing roofs have
higher demand it will be reflected in the value of the home.

~~~
grecy
> _Maybe they don 't want solar_

They will when the cost of traditional electricity is priced to better reflect
it's environmental impact.

In fact, I personally think nobody should be permitted to not have solar in a
new building in 2016. You can't remove the seatbelts from your car in 2016.
You can't build a new building with asbestos in 2016 and you can't turn your
semi-auto rifle into a fully-auto (in most states). Just because you own it,
doesn't mean you can do anything you want, that argument makes no sense.

------
deepsun
Not a word about subsidies on solar power. Has anyone got any data on raw cost
of solar power, without taxpayer's subsidization?

~~~
_ph_
The article was talking about the raw, unsubsidized costs of solar. It is now
on a level, where it can compete on a price basis with conventional energy
production. And that does not count in the hidden costs of coal/gas/nuclear as
their environmental impact rarely gets accounted for.

Here in Germany, rooftop solar electricity costs about half of what the
utility companies charge off the grid.

~~~
ptaipale
... because utility companies have to collect a price that covers the
subsidies going to solar and wind producers, required by law.

~~~
_ph_
Even if you deduct that amount from the utility prices, the grid electricity
stays higher. Of course that has also good reasons - the grid has to paid for,
and the grid is guaranteed to be available 24/7\. Still this shows that solar
is price competitive.

~~~
ptaipale
Depends on market, and depends on time of year, of course.

At least over here (Finland) the problem with wind and solar energy is that
when you actually need electricity (say, a cold winter morning), both solar
and wind power output are locally zero.

To alleviate this, you need a grid, and energy storage, and spare capacity.

~~~
lorenzhs
Right, but Finland shouldn't be the benchmark for solar power viability. The
total population of places with a climate similar to Finland's is quite small
compared to areas where solar is viable.

~~~
ptaipale
On the other hand, places where local solar is particularly viable (like
Sahara) shouldn't be a benchmark for off-the-grid solar viability either,
because not that many people live there. In practise, you really do need to
have grid and storage to use solar.

(Local off-the grid solar is somewhat usable even here, but it does need
battery storage. It is popular in holiday homes that are not located close to
power lines. E.g. I have a cabin which is a kilometre away from nearest
electric lines; building a power line to the grid would cost in the order of
50 k€ while an off-the-grid solar-powered system runs electronics and a fridge
with an investment in 5k€ range.)

~~~
lorenzhs
Exactly. Maybe Germany would be a reasonable benchmark, if one factors out the
subsidies (which used to be very attractive, I'm not sure about the current
status). There are lots of rooftop solar installations in my area (southwest).

------
hacksonx
An interesting finding this. The national power provider in South Africa
(Eskom) has decided to go against the tide and focus on coal powered power
stations. They have concluded that they won't be buying power from independent
power providers which for the most part generate renewable energy. Maybe such
researches and a more firm stance from institutions such as the IMF will help
us in this regard.

------
i-blis
Unfortunately, PV market price drops do not reach the EU market, due to the
anti-dumping and anti-subsidy duties on crystalline silicon modules and cells
originating from China in place since 2013. These protective measures have
caused the solar module prices to even rise during the last two years (and
certainly hampered solar deployment in Europe).

------
exabrial
Article only shows "total installed cost". For an individual, that's great.
But i would have liked to see the actual numbers that go into that itemized.
If the "costs went down" because tax rebates went up, then we're no closer to
solving any real problems.

------
nathan_long
Makes me wonder about the deflationary effects. Eg, would it be rational to
think "I could buy a solar system now, but if I wait a year it will be cheaper
by a large enough margin it's better to pay more in electricity until then"?

------
erikb
Huge fan of solar here. But I don't think the argumentation in this article is
very convincing. 5-15% in a year? That's maybe a huge price drop for the
industry, but for the average user it's barely worth mentioning. Maybe I'm
just impatient. I want to see that stuff everywhere. Solar roads, solar train
walls, solar sun umbrellas, maybe solar sun cream to charge your phone with
your fingers, who knows.

And honestly I can't even say why. Water, biogas, wind. We already have quite
a range of responsible energy sources. But none of them are as exciting as
solar power to me. Nearly like a Mars colony. Not much logical reasoning
behind it, but still quite exciting.

~~~
sandworm101
>> Water, ...

Look into the new science on that one. It can make carbon sense when you flood
a desert to feed a hydro dam, but if you flood a forest then the carbon math
isn't so great. Microhydro seems an answer, but there too you have to
calculate how much forest is being deprived of water, and what that means for
carbon uptake. It's probably still better than coal, but it isn't perfect.

~~~
schiffern
Generally with small-scale microhydro (low single digit acres) you get good
biomass production because you've created more edge. Edges between biomes
(estuaries, forest-field transitions, etc) are the most productive and diverse
places in nature because you get overlapping species and the associated
beneficial interactions.

Many small dams produce a lot of forest-water edge cumulatively, unlike a few
huge dams.

------
ams6110
Interestingly if the price is falling that's motivation to not buy. Why
install solar today when it will be cheaper tomorrow?

~~~
marcosdumay
While I do agree that it is a bad time to invest in electricity generation
business in general, an electricity consumer would invest in solar today
because he has some saved money today, and it's the best ROI around. (Or
wouldn't, if it isn't.) The price it may have tomorrow does not change the
overall picture.

~~~
lobe
Couldn't the consumer deduce that the better ROI is to keep the money as cash
(or some other liquid investment) for 2-3 years and then spend it on solar in
2 years time? My expectation of future prices definitely affects how I spend
my money today.

~~~
marcosdumay
Yes, there are possibilities for speculating, but you are betting prices will
fall faster than inflation + the ROI of your investment.

Plenty of people don't want that kind of risk.

------
amelius
So why aren't utility companies installing solar panels on my roof just yet?
Why is the upfront financing of solar panels still a problem?

~~~
daurnimator
because you mainly need power when the sun isn't shining. Once you add in
costs of electricity storage it's not economical.

~~~
imtringued
Here is a live graph of power production/consumption in germany. You should
take the prediction for the rest of the day with a grain of salt though.

[https://www.agora-
energiewende.de/en/topics/-agothem-/Produk...](https://www.agora-
energiewende.de/en/topics/-agothem-/Produkt/produkt/76/Agorameter/)

~~~
daurnimator
What you'll notice is that Lignite (=Brown Coal)+Nuclear+Biomass+Water (i.e.
the base generation) are sitting at the lowest point of consumption for the
day.

Solar will only be able to increase (without storage) until there is no black
coal used.

~~~
kuschku
Correct, but Wind is already taking over large parts of the lignite part.

And the pumped water is storage for solar, btw.

For us as a society, it doesn’t matter if we end up with 100% solar, but only
that we end up with 100% combined of Biomass, Pumped Hydro, Wind, Solar,
Water.

------
known
"If it moves, tax it. If it keeps moving, regulate it. And if it stops moving,
subsidize it." \--Reagan

