In recent years, as a need for energy independence is becoming more pressing, the spotlight has shifted to renewable energy sources like never before. One contender that’s gained significant attention is solar energy. While solar’s popularity is growing, so are concerns about the perceived cost of residential solar. Before addressing the rumors that solar is only for the rich, it’s important to note that the price of residential solar has dropped significantly over the last 10 years. According to the National Renewable Energy Laboratory, the price of installing solar panels on a residential rooftop has plummeted by more than 60% since 2010.
Back then, it used to cost around $7.53 per watt, but fast forward to 2021, and that price has made it’s way down to a much more wallet-friendly $2.95 per watt. That’s a 61% drop! It’s clear that over the past 10 years, solar has become much more affordable. Check out this video to learn more about the dropping cost of solar and how it's becoming less expensive over time![embed class="is-loading"]https://www.youtube.com/watch?v=V8Vtb0bn30M[/embed]
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Solar Panel Pricing and Manufacturing
When it comes to solar panels, the manufacturing involves more than just squishing together silicon wafers and glass.While silicon is a major player, its refinement demands a hefty chunk of resources, impacting the cost. Moreover, the processes that transform these basic materials into photovoltaic cells are no small feat. Think of it as crafting tiny energy-converting engines, each one striving for optimal efficiency.
Technological Challenges and Efficiency
The push to enhance solar panel efficiency encounters challenges similar to a puzzle with constantly shifting pieces. Innovations in materials, like next-gen thin-film solar cells, come with their own set of problems.There is also always research going on to find cheaper, more efficient materials (like research done at the National University of Singapore with perovskite). Research and development racks up expenses faster than you can say “photovoltaic.”Higher efficiency and greater energy yield demands constant experimentation, rigorous testing, and fine-tuning, all of which contributes to the cost. However, it also contributes to the cost dropping as well. This is explained by Moore’s Law, which is a prediction that the technology used to make computer chips (microchips) will keep getting better and cheaper over time.Let’s think about this in the context of residential solar panels. Solar panels are like devices that capture sunlight and turn it into electricity that can power your home. Just like computer chips, the technology behind solar panels also keeps improving over time.A few years ago, solar panels might have been quite expensive, and the amount of electricity they generated might not have been as much as you needed. But due to advancements in technology, solar panels have become more efficient and cheaper to produce.This means that the solar panels you can get today might be more powerful and affordable than ones from a few years back. Just as you might expect a newer smartphone to be faster and more capable than an older model, newer solar panels can generate more electricity for your home while being a better deal overall.
Installation and Infrastructure Expenses
Picture this: a team of professionals orchestrating the installation of solar panels on your rooftop, ensuring every angle is perfect for soaking up the sun’s energy. Sounds smooth, right? Well, here’s where the costs start to rise.The equipment required for installation, coupled with the specialized know-how, isn’t something you can conjure with a snap of your fingers. There’s a lot that goes into each installation, as workers secure the panels, connect the intricate wiring, and ensure the system is primed for action.But that’s not all – solar energy’s integration into the existing power grid is like weaving new threads into an already complex fabric. This interweaving demands additional equipment, system testing, and regulatory approvals, all contributing to the grand total of expenses.However, as each system is installed to maximize the amount of energy that is absorbed, it’s setting you up to save more money in the long run.[embed class="is-loading"]https://www.youtube.com/watch?v=uUM84nfLoxU[/embed]
Solar Financing and Return on Investment
Investing in solar panels isn’t just about saving the environment – it’s also about saving some green in your wallet. Various financing options, from loans to leases, make going solar a possibility for many.Additionally, here’s a bright spot to consider: the energy payback period. Think of it as the time it takes for your solar investment to start paying off in energy savings. While this period can impact the immediate cost, the long-term savings and return on investment make it a sunny proposition for many.Another bright spot to consider is the Federal Tax Credit offered to those who install solar. When you install solar, you can receive a federal tax credit that is equal to 30% of the cost of your solar panels. Some states also offer additional credits, depending on your system. For more information on the Federal Tax Credit, you can check out this article: Understanding the Federal Solar Tax Credit
The Bottom Line on Solar Panel Prices
Even though most people’s perception of solar is that it’s a huge expense, it will be cheaper than continuing to pay the power company for another 30 years. Between rising costs of energy and dropping costs of solar installation, it’s an investment that is sure to to pay off sooner than later.Humanity has come a long way in its ability to harness the sun, and it’s an affordable possibility for many households now thanks to tax credits, financing & advancing technology.Sure, the upfront expenses might seem like a hurdle, but they pale in comparison to the long-term benefits. Check out our solar score quiz below to see if going solar would be a good investment for your future.
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