December 09, 2013
Hardware Now Less Than Half Of Solar Residential Cost

Installation, marketing, and other costs total up to 64% of residential solar panel installation.

Two detailed reports from the Energy Department's National Renewable Energy Laboratory (NREL) find that solar financing and other non-hardware costs often referred to as "soft costs" now comprise up to 64% of the total price of residential solar energy systems, reflecting how soft costs are becoming an increasingly larger fraction of the cost of installing solar.

It is worth noting that costs for new construction are lower than costs for upgrading existing housing.

For residential systems, the greatest soft costs were supply chain costs ($0.61/watt), installation labor ($0.55/W), customer acquisition ($0.48/W), and indirect corporate costs ($0.47/W), such as maintaining office management and accounting functions. Other soft costs examined for the report included costs for permitting, inspection, interconnection, subsidy applications and system design.

This result suggests to me that solar panel installation will play a much larger role in new home construction. Labor costs will be lower when the solar panels are installed as part of the original roof construction. Little or no marketing costs if a builder is doing the installation to a group of houses.

Robotic construction equipment is going to cut home construction labor costs, including labor costs for installing solar panels. But as solar expands it is going to get battery storage costs tacked on as it causes more imbalances in the grid between demand and supply.

Share |      Randall Parker, 2013 December 09 08:25 PM 

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