Can Solar Costs Keep Shrinking?

I spend four months of the year traveling in an RV. Two years ago, I budgeted over $6000 for my desired solar setup (at least 1200Ah of battery, at least 2400W of solar, plus various controllers and other components). It was expensive enough for me to hold off, and more importantly, I didn't have the space on my current RV for the solar panels.

In just the two years since then, prices on batteries and panels have dropped 25% or more, and solar power per square foot at a good price point has gone up significantly (400W monocrystalline panels can be gotten for $200, in the same form factor as the 200W panels I had been budgeting for). I've now lowered my budget to $4000 for the same setup I was planning to spend $6000 on two years ago, and with 400W panels, I no longer need to upgrade to a larger RV to begin the project.

This summer is almost over, so I'm going to wait until spring to start assembling my system in earnest. Anecdotally, this is a game-changer for me. I'm looking toward year-round full-timing starting next summer, because I can now afford the power I need and don't need a larger RV as soon as I thought I would.

I intend to buy undeveloped land far from civilization in the next few years, and I'm now confident that I can DIY a whole-house solar and battery setup so cheaply that access to mains power won't be a factor in deciding where I settle. Even with seasonal variation in power production, I'll manage just fine, and the system will pay for itself in well under five years. In fact it'll pay for itself instantly if you discount the five-figure cost I would otherwise have had to pay for running a new mains power line far into the woods. And by the time I pick some land to settle on, I'll already have enough solar on my RV that I won't even need to augment the system initially; I'll be able to power a small house in a temperate climate directly off the RV itself, while I build a larger solar array (likely ground-mounted to avoid regulations and insurance complications related to roof-mounted setups).

I know my situation is unusual, but the fact that any of this is possible for well under $10k is a huge change from even a decade ago.

I'm having a hard time getting past the assumption in the article that energy use is tied directly to GDP per capita and that by not following the 7% growth of the Henry Adams Curve we're somehow below where we should/could be as a country. That embeds so many assumptions about the economy and where GDP comes from, the decoupling seems more likely to be from the transition from manufacturing and other energy heavy sectors to more services based economic activity..

Yes

The pallet price of solar panels in the US is below 30 cents a watt.

https://a1solarstore.com/wholesale-solar-panels.html

And from alibaba, it is below 15 cents a watt.

https://www.alibaba.com/product-detail/Longi-solar-Hi-MO-X6-...

With full systems below $1/watt. https://www.alibaba.com/product-detail/Moregosolar-hybrid-so...

Soon (if not already) the largest costs associated with solar installations will be the labor. It's expensive to get people on roofs and electricians to reconfigure panels, install transfer switches, etc. The equipment could be free and it would still cost thousands for the skilled trades to install.

I remember as a child being on a school tour of the Enrico Fermi nuclear plant South of Detroit being told that nuclear power would soon become too cheap to monitor. This was over sixty years ago!

So I am a bit skeptical. I also remember around 1975 getting all excited about solar and getting told that costs were dropping so fast that in five years solar would be cheaper than power produced from coal or natural gas. Close to fifty years later I am still waiting.

I bet if you're in San Diego, Dallas or Tampa its already there. We have tons of solar getting built in the state of Michigan area but if you inquire its all either government subsidized or wealthy folks who can afford to not care about the economics.

I am not against solar in the least. But it needs to be pointed out that those of us in the Northern climates need a Plan B whether it be nuclear, geo-thermal or something else.

I used to be radically pro-nuclear, but after seeing some of the data of solar growth and realizing we could just scale things up (like building iphones), I'm fully on board with the Elon strategy of solar + powerbanks for storage.

Yes. For a detailed (verbal) analysis, see Patio11's podcast (also featuring Casey Handmer quoted in this article): https://www.complexsystemspodcast.com/episodes/solar-economi...

Solar power is the future. The drop in price in the last 20 years is absolutely wild. The charts in this article show this. What's encouraging is that it's pretty steady progress. It's hard to predict when or where that ends.

Batteries continue to get cheaper (also covered). This matters too because storing energy solves the base load "problem". Batteries aren't the only way to store energy either. There continue to be advances in the so-called "power-to-gas" technology, where you essentially use excess power to make fuel, usually from CO2 in the air. This isn't currently economic but it continues to get cheaper. It also provides an upper ceiling on how expensive gas can get.

The LCOE of nuclear in particular is damning [1]. Every single commercial nuclear power reactor has been built with government subsidies too so it doesn't seem like government support is the issue. There are still too many unsolved problems.

Solar is the only method of direct power generation. I think every other method inovles turning a steam turbine. There are no moving parts. They can be installed on everything from wristwatches to power stations to satellites.

[1]: https://www.eia.gov/outlooks/aeo/pdf/electricity_generation....

Has the insurance & roof warranty issue been solved with panels on your roof?

A few years ago I looked at putting solar panels on my roof.

Both the company who roofed my house, and my insurance company - said it voided any warranty / claims against future roof damage if a solar panel was installed

If labor costs keep going up, it seems like the right path for the industry is to simplify installation more so it becomes more DIY. More plug-and-play. Less skilled carpenters and electricians.

Just to point out that the reason why solar panel costs have been decreasing is because china as part of their 5-year plans set solar energy as a national priority and the world is now benefiting from their upfront investments and economies of scale. This is a clear datapoint towards economic planning for the green transition and rational management of natural resources.

These charts stop right at the point where the U.S. imposed tariffs on Chinese solar panels, and the tarrif schedule is only going up, to 50%. This matters because the future of solar is utility scale, where the panel costs dominate. So for the US, at least, solar costs will not keep shrinking in the short term.

How do we get around labor being the primary cost eater when that has (is) the most expensive factor, depending on where you live?

I want labor to be paid, and I also want cheap clean energy. Help me square the circle.

The premise of the article, that we would be richer if we used more energy is preposterously wrong. A light bulb used to be typically 100w, it's now a 1/10 of that. We get a lot more out of the energy now, which means we are in fact richer because we have more things. I just bought a TV which uses a quarter of the electricity of a Tv from a decade ago, and this with 4x as many pixels.

The big idea most people fail to grok is that we don't need energy at all, we need certain things energy provides us (light, heating, cooking, entertainment etc). But if I could super insulate my house and use 0 energy to keep it warm, this would not make me poorer. On the contrary.

Amory Lovins came up with the idea of "negawatts" a long time ago.

Around here, cost of solar have risen recently. Even though there still is the stimulus rule that any surplus put into the net can be extracted later (ie., the net functions like a storage facility for any residential installation), recently, power companies have started charging for returning energy. Quite massively too - the difference with their sale price is 2-4 cents/KWhr.

While there are good (as well as bad) reasons for this, the upshot is that the RoI for residential installations changed abruptly and became significantly worse - more or less overnight.

Due to that, and the low cost of the panels themselves, whether they become cheaper isn't very relevant for the market here (since other costs dominate).

I've decided not to do home solar because it seems obvious to me that industrial scale plants will be able to do it cheaper.

One thing that is often forgotten is the difference between the cost of electricity at the power plant, and the price of electricity in the power plug in the household. The difference is that the grid provides constant electricity at 60Hz 24/7.

Solar is much cheaper to produce, but there are many challenges to get a reliable grid. Big centralized power plant that have huge turbines with kinetic energy are much easier and cheaper to handle on the grid than a distributed intermittent production where you somehow need to convert to 60Hz and add storage that has quite some loss.

>What will the world be like when panels cost $0.05/watt? $0.01/watt?

"Good morning, I would like a 400W solar panel"

"Sir, that will be $4"

Solar panels cost less than windows:

89x44" for $221.40: https://www.portable-sun.com/products/canadian-solar-540w-bi...

96x48" for $544.00: https://1stwindows.com/retro/milgard2/trinsic/picture-window...

Those were the first that came up in search. I'm seeing other 500 W panels for $100-150 and windows for $1000-2000. But we can safely say that panels are less than half the cost of windows.

The increase in solar panel cost was from Trump's 30% solar tariff in 2018:

https://www.seia.org/research-resources/section-201-solar-ta...

The saddest thing about all of this for me is that we had the tech to manufacture inexpensive solar panels at scale in the 1980s. Just like any of us could design better computer vision sorters for recycling. We're stopped for protectionist geopolitical reasons so that people in entrenched industries don't lose their jobs.

I wish we could be honest about this, because it's what the next US presidential election is about. We can pretend that we live in a free market economy of winners and losers, or we can work together at a meta level above the zero-sum game Nash equilibrium that's leading us inexorably towards species extinction and global climate change:

https://medium.com/nori-carbon-removal/how-to-break-the-clim...

OP suggests that land costs will soon dominate the equation. So no mention of orbital solar plants?

Yes, somebody years ago published a study that said, Uneconomical! because lift costs, panel cost, transmission inefficiencies.

All of those are now drastically changed, by orders of magnitude. It is not a matter of IF orbital solar is economical, but WHEN.

Spike in LCOE is merely because of interest rates. Which hits solar the hardest as it doesn't consume fuel and it's maintenance costs are very low, so almost all of the LCOE is cost of initial capital investment stretched out to 20 years by applying the interest rates, which are high.

No need to look for doom scenarios here. Interest rates fluctuate. They will be back to some lower point than today but certainly higher than in 2020. LCOE will drop off.

There's no need for solar costs to go down at all anymore. Transition will happen even if they get stuck forever, solar is cheap enough, now it's just about speed at which factories can be deployed, installers trained, etc.

Think these days we should really be talking more about storage than panels.

And I don’t mean lithium batteries. More things like molten salt and sand batteries - things that require a bit of planning and infra that is reliant on rare metals etc

I think it's irrelevant if the cost of solar panels goes to zero, the reality is that the farm to fork cost/kwh is still quite high because dispatch and transmission are never cheap.

Furthermore, for every 1 pound of polysilicon produced...you get 4 pounds of silicon tetrachloride output.

I gambled on $UAN and $AMR guesstimating that the spread of renewables would lead to more nat gas and coal/steel consumption per a kilowatt hour produced globally. I got lucky and it worked out. I'm not bullish on solar costs going below the embodied energy cost of desal per 1000 gallons. (10-14kwh/1000 gallons)

if author is here: your footnotes don't seem to work...

Customers are paying prices, not costs. A cheap kWh of solar electricity isn't useful when it's not available when needed. Prices are mandated by supply and demand.

Also, while the costs of the solar modules may fall further, the costs for the whole setup does not. A solar power plant requires a lot of mechanical and electrical parts to get the solar modules installed and connected to the electricity grid plus labor costs.

I have seen a ton of articles about the plummeting 'costs' of solar over the past decade, so I was shocked when I recently got a bunch of quotes for a 10-12KW residential install: they were almost the same as the cost of the 10KW system I had installed back in 2014.

So at least here in California, inflation and rising labor costs have eaten up all of those savings.

The core realization of the article is that energy costs have increased 30-100%. This is inline broadly with inflation experienced post-COVID presumably due to all the helicopter money dumped on the economy.

I suspect if these figures were revised for inflation, the same trends we've seen over the past ten years would persist.

Does anyone see signs of data center usage being affected by electricity costs? I imagine a relatively near future where your AWS bill changes depending on the time of day, and so companies shift their computational work from region to region, following the sun.

I hate the chunk of rhetoric around GDP. What an uncritical readthrough thinks: oh man, everyone should be making a bunch more money. What they actually said: a couple hundred people in the US missed out on capturing all these lost gains.

Why are residential prices on electricity not falling if costs of energy production are shrinking? If anything, prices only go up and electricity companies especially raise them during hot season.

Are the costs of roof/home installs falling anywhere? Here in eastern Canada the pricing has gone up per kWh in the last 10 years fairly significantly.

Does converting sunlight to electricity reduce the amount of heat absorbed by the earth? If so, how many solar panels would be required to reduce the temp by 1 degree?

We're there on solar panels. The next step is batteries.

And roof systems. Cheaper ways to get solar panels on roofs. That's mostly installation cost. Does Tesla's solar roof [1] actually work? Anyone have one?

[1] https://www.tesla.com/solarroof

As long we keep using logarithmic axes: yes, indefinitely!

Surely can, but you have to pay the installer guys and the structure that holds the panels even if they cost zero.

solar costs keep shrinking and then you have power companies like SDGE that want to punish solar owners based on their salary and set a $125 min cost to be connected to the grid

Solar + LFP batteries, Energy Combo for the future

this article is unfortunately fairly usa-centric, but it doesn't really mention the main cost driver for solar installations in the usa, which is the predatory tariffs that have been imposed by a series of administrations, based on the most ridiculous rationales. it does mention that solar panels in the us cost more than twice what they cost elsewhere, but doesn't really explain why. the number now is more like 4× because international panel prices have fallen by half since the year-old figures mostly used in the article. it says, 'overseas, it can go as low as $0.10-$0.12/watt', but actually the current benchmark figure for low-cost solar panels in https://www.solarserver.de/photovoltaik-preis-pv-modul-preis... is €0.07/watt peak, which is 8¢/watt peak in the us dollar

the latest ridiculous news item in this pathetic story of regulatory capture is a petition from the american alliance for solar manufacturing trade committee to impose retroactive import tariffs on solar panel imports from vietnam and thailand https://www.pv-tech.org/us-manufacturers-seek-retroactive-ta...

the supposed justification for thus kneecapping us heavy industry by cutting it off from the cheapest energy in history? 'dumping': supposedly chinese solar panels (the majority of the panels sold in the world, but under 0.1% of the us market https://www.seia.org/research-resources/solar-market-insight... More) are being sold 'under cost'. but when you dig into the justifications for the supposed 'dumping', it turns out that they amount to things like 'provision of solar-grade polysilicon for ltar (less than adequate remuneration)' and 'funding on infrastructure'. i.e., the us department of commerce is trying to charge chinese solar module manufacturers for the government building power plants and cutting good deals on raw materials with other chinese companies. see barcode:4426784-02 c-570-011 for example (there's apparently no url i can use to link these documents directly). useful starting points may include https://www.federalregister.gov/documents/2023/07/11/2023-14... https://www.govinfo.gov/content/pkg/FR-2014-12-23/pdf/2014-3...

to give you an idea of how ridiculous these justifications are, one of the other documents i got was arguing about whether the fair market price for chinese solar-panel-assembling labor should be determined by comparing it to malaysian electronics-assembly labor or romanian electronics-assembly labor. they ended up settling on turkish labor, so to the extent that wages in the area of china where trina solar assembles their panels are lower than wages in turkey, the us department of commerce is imposing the difference as countervailing tariffs for 'dumping'. the evidentiary standard in these proceedings is 'guilty until proven innocent' ('adverse inference in selecting from the facts otherwise available')

the us keeps imposing new import tariffs against renewable energy; https://finance.yahoo.com/news/analysis-bidens-china-tariff-... documents how they're trying to keep out not just solar panels but also electric cars, but failing, because chinese investment is creating new productive capacity for the relevant goods throughout the world — the opposite of what would happen if dumping was actually happening, since the objective of dumping is to drive competition out of business

the result is that solar energy in the usa is several times more expensive than in the rest of the world, so it's getting installed only very slowly. the contrast between the rather pathetic https://www.seia.org/news/solar-installations-skyrocket-2023... (32.4 gigawatts installed in the usa in 02023, only 8% of the worldwide 430 new gigawatts installed worldwide) and the 216 gigawatts added at the same time in the prc (https://www.spglobal.com/commodityinsights/en/market-insight...) and the astounding 660 gigawatts expected in the prc this year: https://www.pv-tech.org/bnef-global-solar-additions-655gwdc-...

this by itself should make it clear how ridiculous the 'dumping' accusations are. if you're dumping a product, selling it below its production cost in order to eliminate overseas competition, you don't sell it to yourself. that's losing money on every sale and trying to make it up on volume!

so what's happening is that the world is going through the renewable energy transition, solving the problem of global warming, despite the usa fighting tooth and nail to prevent it with its foreign and trade policy. the prc is leading, developing new manufacturing techniques that lower the prices of energy so low that us companies insist they're dumping their solar panels below cost, but mostly investing in securing access for their own domestic industry

the last time a major new source of energy became available was the steam engine, which is still what powers most of the world's electric grid, in the form of steam turbines in nuclear and coal power plants. that enabled new forms of industry and new economic structures. for the last 50 years we've been stuck in an energy crisis as we've run into fossil-fuel resource constraints and dropping eroei. that crisis has finally ended; the future is already here, but it's not widely distributed. usa policy seems focused on ensuring that the future arrives domestically as slowly as possible, enabling china to obtain as large a lead as possible in the new energy-intensive industries enabled by unbelievably cheap solar energy

if you want the us to be the place where builders go to build things, you need to fix this

The article concludes that solar costs will drop another 8x then plateau.

> If we had stayed on the Adams curve, we would be consuming 2-5x more energy than we do today. For the US, that means that GDP per capita today would not be the current amount of $65k, but $100k-$200k. It is a catastrophe that we don’t have more energy: We should be much richer.

I'm sorry, what??? Correlation != causation. We have become more energy efficient, and it does not follow at all that cheaper energy will increase our GDP by 2-3x.

Thanks for sharing

Thanks for sharing.

The issues for p.v. are mainly two:

- one is speculation, because yes panels get cheaper, so inverters and batteries, but prices to the customers AUGMENT more and more, and current prices for private, domestic p.v., at least in the EU, it's so high that's a nonsense installing them. Personally, since in my country it legal, a thing NOT so common, I've build a small domestic system for 11.500€ while the cheapest offer was a bit more than 30.000€ for essentially the same setup, worst than mine;

- the other is again speculation on many sides, one of the most prominent the push toward utility-run p.v. witch is UNSUSTAINABLE, because it makes the load to large classic power plant vary way too quickly and too much to keep the frequency stable because we can't make enough grid storage and for such usage batteries life span it's way too low, p.v. works very well for self-consumption, with domestic storage as a grid backup, but not more.

If we do not state clearly: the service model where very few own nearly all it's incompatible with the Green New Deal, we have two options: killing large finance capitalism model or falling to implement the New Deal plunging from the first to the third world countries. I'm damn serious.