Will the Cost of Solar Panels Go Down as Technology Advances?

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Look on the rooftops of some residential neighborhoods and you’re likely to see solar panels. In the last few years, solar panels have become increasingly important in offsetting the rising costs of electricity. If you haven’t considered installing solar panels in your home recently, you may be pleasantly surprised to learn just how low prices have gone.

Competition & Economies of Scale Reduce Costs

Remember economics class? As technology changes, industries change, and as it becomes easier to produce items at a larger scale, their production actually becomes cheaper. This is called economies of scale. Much like big screen TVs, producing more solar panels over time reduces production costs.

Competition among solar panel providers is also driving costs down. But, more than that, competition is also leading to innovation within the industry. Now, greater, more powerful, more efficient solar panels are becoming available at a lower cost. The overall improvement in solar power technology and the manufacturing process is making solar power more widely available, a great thing for the environment and for our wallets.

$53 Million for Next Generation Technology

Solar PV panels now cost half of what they did just three years ago. As companies continue to invest in new, more efficient and productive manufacturing facilities, costs will go down as production scales up. To drive costs down even further, U.S. Energy Secretary Ernest Moniz recently earmarked more than $53 million for 40 innovative research and development projects. These will address major aspects of technology development and bring innovative ideas to the market more rapidly.

The goal is to fully support the development of next generation photovoltaic (PV) solar technologies and manufacturing processes. Specific projects will improve the performance, durability and efficiency of PV devices—everything from new high-performance materials to more efficient solar cells that cost less to manufacture. This supports advancements in both hardware and non-hardware, lowering costs throughout the manufacturing process and helping make solar electricity more affordable and accessible for today’s homeowners.

SunShot Targets Solar Tech

The U.S. Department of Energy recently invested more than $14 million in its SunShot Incubator program for 20 small businesses. The program is designed to develop innovative technologies and services to drive down hardware and non-hardware solar system costs. Specific goals include shortening the time between laboratory-scale proof of concept and prototype development, and accelerating the transition from pre-commercial prototypes and pilot devices to full-scale manufacture. Since its inception in 2007, 61 startup companies have received 74 awards to participate in SunShot. The projects have spurred technological innovation in everything from photovoltaic technologies to power electronics.

A Solar Cell Breakthrough

A new solar design, recently introduced at the IEEE Photovoltaic Specialists Conference in Denver, promises to boost efficiency and reduce cell costs. The new design addresses a major problem with conventional silicon solar cells—imperfections at or near the surface of the crystalline silicon wafers—which can trap electrons, reducing both current and voltage output. These imperfections are now prevented by applying thin films of silicon to the front and back of the silicon wafer. The new cell design converts 25.6 percent of the energy in sunlight into electricity. While not a big leap in efficiency, the new design highlights a bold new way to design solar cells, which can lead to future improvements in efficiency and reduced costs.

Should you wait for technology to bring costs down even further before installing solar panels on your home? Yes, you could wait for costs to come down, but unlike big screen TVs, solar panel technology prices won’t come down that fast. And installation costs won’t be affected as much by improvements in technology. In fact, labor costs will more or less keep up with inflation. So every day you wait, your electric bill continues to rise, which means you’re paying for waiting.

Be smarter than that! Install solar panels on your home today – talk to a representative and see which option may be right for you.

 

Posted on Monday, January 26th, 2015