Factors that are causing sharp fall in Solar Costs and home solar systems

                    

Factors that are causing sharp fall in Solar Costs and home solar systems

Introduction  

There has been a phenomenal growth in solar capacity (500 GW in 2018 forecasted to grow to 4600 GW in 2025) internationally. The drivers of this growth are: reduced cost of technology; government policy and initiatives; and innovation in solar technology. The key factor is cost, PV plant efficiencies have increased and there is ongoing innovation that is decreasing the cost of solar technology.

Solar panels, inverter costs and panel racking costs have come down at a steady pace each year, resulting in large declines over time. There are a variety of causes, including manufacturing efficiencies, a steep decline in polysilicone prices from their high levels a decade ago (a material used by the photovoltaic solar industry) and fierce competition among manufacturers.

Core equipment cost has fallen faster than any other cost element that contributed to solar pricing. PV module accounts for 40% to 45% of the total solar cost, inverter contributes 20% to 35% of the total cost, project costs have declined by 20% in 2017 alone and there is every reason to believe that significant decrease in cost will occur in the future. The cost of the solar module has dropped by 40% between 2010 and 2016. This has been driven by technology, economy of scales and increasing automation .Production costs are forecasted to decline by a further 15% to 20% between 2017 and 2025.

The   buy back metering and arrangements also will assist the increased penetration of the solar. The role of the so called “prosumer” an entity that is both a consumer and supplier of solar power will increase. It is likely that the near future it is likely that the smart building package will include a solar interface .This may include a energy management system, storage and smart appliances. Net energy metering (NEM) is essentially a billing arrangement that allows organizations generating their own electricity to deliver unused energy back to the grid—and be credited at the retail energy rate. In most cases, these credits are applied to your monthly electric utility bill or rolled over month-to-month until they’re used up. You can even be compensated for any excess energy you generate. It can be a highly effective way to reduce the overall cost of solar panels for business.

Solar and solar battery storage   may make financial sense. An ever-growing number of businesses are taking a closer look at the potential of battery storage to lower their monthly energy bills, especially when combined with a commercial solar system. These refrigerator-sized batteries can offer a highly effective way to reduce demand charges by discharging their stored energy when needed to offset spikes in demand—potentially leading to substantial savings.

Digitization has already become an important factor that has driven prices down. The inverter can become the brains of the energy management system and contribute to further efficiency in energy utilization .Digitization can also assist in reducing the O&M cost of a large solar installation. Interconnection to a main grid also offers business opportunities to both the grid and the prosumer .

Higher AC voltages allows for higher power density, lower losses, and improved reliability. Modern homes now have solar panels cover the roof and façade and generate dc which is converted into ac by invertors. In one hour the system harnesses enough Energy to power the building for a complete day with the excess stored for later use or supplied to the grid.

Home solar systems

Purchasing a solar system large enough to offset all of the electricity that an energy-intensive home uses every month is necessarily going to cost more than installing a smaller solar array that is intended to just offset some of the electrical bill. One cost-effective method of reducing the size of the solar system needed is to reduce the amount of overall electric demand in the home, before trying to price a residential solar system, as purchasing a smaller solar power setup can offset a larger percentage of the home’s energy needs, simply because the demand has been reduced. Replacing older appliances with more modern energy-efficient models can be one approach, but potential solar homeowners can also use other strategies for reducing their electrical demands, including installing or modifying their landscaping so that it helps to shade and cool the house, installing more insulation and upgrading the windows and doors, as well as tracking down vampire energy loads (electrical demand from electronics and appliances that can use quite a bit of electricity when nobody is using them – even while on standby).

Rooftop evaluation

Another factor that affects the cost of solar is the amount of space available on the roof that can be used for a solar array, and the orientation of the roof itself. A rooftop that has less available space for solar panels can limit the size of the rooftop solar array, and a smaller array will cost less than a larger one. A roof that isn’t oriented to the south or the west, or one that has too steep or too shallow of a pitch won’t be as efficient as a rooftop solar array that exposes the panels to the sun for long periods throughout the day and the course of a year, and any system inefficiencies will effectively raise the relative cost of a residential solar system because of reduced output (as compared to a system of the same size, but with optimal orientation and pitch).

Choice of solar panels

The type and model of solar panels used for the system is another factor in the cost of solar, although one that may be more up to the solar installer than the homeowner. Three different types of solar panels are available on the market: those made with monocrystalline solar cells or polycrystalline cells, and thin film solar. For home solar systems, the two types of panels used most often are those made from monocrystalline or polycrystalline cells. As a rule of thumb, mono- type cells tend to be more efficient than poly- cells, but they also command a slightly higher price. Solar panels made from polycrystalline cells are said to have an advantage in hot climates, as some of the monocrystalline units may lose some efficiency as the panels heat up on hot days, although these specs can vary by model and manufacturer. Due to higher efficiency, a monocrystalline panel can be sized smaller than a polycrystalline panel with the same generating capacity, which means that the overall array can be smaller. However, for a home-sized solar array, being able to save 10% of the space with higher efficiency solar panels may not be nearly as important as getting the best overall price. Advances in solar technology, and the current trend of dropping costs for solar panels, is gradually equalizing these differences in solar cost and solar efficiencies.

Because solar panels are manufactured by many different companies, each with slightly variations in configuration, materials, and technology, the costs of the panels can vary quite a bit when it comes to quality and efficiency. Choosing the lowest price you can find on solar panels may seem like the way to go at first, but bargain-priced solar panels may end up saving less money (or costing more, depending on how you see it) over the years, because if those panels aren’t as efficient, or are a lower quality, the cost per watt generated over time won’t be as good of a deal as originally thought. On the other hand, higher priced solar panels may not always offer the best value, either. In order to consider the overall cost of a solar system, it’s important to calculate a cost per watt for the whole array, and to figure in the power tolerance ratings for the specified solar panels, which will give you an idea of the range of variation you might see in their performance.

Solar panel mounting hardware

Another factor that goes in to the price of a residential solar system is the kind of racking (mounting hardware), and the amount of racking required for a system. The racking is used to fasten the panels to the roof itself, and to connect each panel with the ones adjacent to it. Each solar installer has their own favorite mounting system they use for each different type of situation (the local weather conditions, the pitch of roof, the size of the solar array, and so forth), so the choice and cost of the mounting hardware will probably be up to the solar installer, unless you install your own system.

Power inverter

The brand and model of the power inverter unit, which converts the direct current (DC) electricity produced by the solar panels into the alternating current (AC) used inside the home, and which connects the solar system to the utility grid, also affects the total cost of a solar power installation. Just like solar panels, there are a variety of different manufacturers and models of solar inverters available, and all of them feature slightly different efficiencies and ratings, and are made for different installation situations. The solar installer will probably be choosing the appropriate model for your solar array, which they will determine by their working knowledge and personal experience with installing inverters for different situations.

Labor costs

The cost of the labor to transport and install the solar array is another factor that can affect the cost of residential solar power, and is something that the installer generally includes into the cost of the solar project. Labor costs for solar installation can vary widely by geographic location, by individual installers, and by the size of the array. The labor costs aren’t something that can be individually reduced, unless the homeowner installs their own system, so getting several quotes for the cost of similar solar power systems, as well as the specifications, from different installers is one way to be sure you’re getting the best overall value for the cost of a solar system.

These variables are all part of the residential solar power equation that determines the cost of solar power, and while some of them, such as size of the solar array or where it gets installed, can vary by the customer, other costs might not be nearly as simple to compare. Because of this, it’s important to ask a lot of questions of the solar installer, which can help you to make the most informed choice and get the most solar value for your money.

Solar panel efficiency, or conversion rate, refers to how much of the incoming solar energy is converted into electrical power. Typically, the efficiency of commercial solar panels operates in the range 11-15%. The most efficient solar cell to this date is based on a multi-junction concentrator and converts 44.0% of incoming solar energy into electricity.^[1] The highest performing solar panels has a module efficiency of 20.1%. 

 Another factor likely to impact the overall cost of installing a solar system in your home is the type and model of solar panels you decide to use, although this might be up to the installer and not you. There are three types of solar panels on the market:

·         Monocrystalline cells solar

·         Polycrystalline cells solar

·         Thin film solar

The solar panel mounting hardware and the amount of racking required will also impact your final price. Racking is for fastening the panels to your roof and connecting each panel to the next. Each installer has a favorite mounting system depending on the situation, local weather patterns, size of your solar array, the pitch of your roof and others. Other solar panel factors that have a direct bearing on the estimate you receive include the power inverter unit you use and labor costs.

Solar Panel Type

• Monocrystalline solar panels are based on the highest-purity silicon available. This makes them the most efficient solar panel type available for homeowners.
• Solar panels based on polycrystalline silicon are usually not quite as efficient as monocrystalline, but there is not that much of a difference.
• Today`s thin-film solar panels are relatively inefficient, but they also cost less. Thin-film solar panels take up a lot more space than mono- or polycrystalline solar panels, which is why they are unsuited for most households.

 Shade

Shade will obviously affect the output of solar panels. Depending on your setup, a little shade can even bring down an entire solar system. Micro-inverters offer a possible solution to shading issues. Professional solar panel installers will do a thorough analysis of shading in your specific situation.

Orientation

For best efficiency, solar panels should be positioned to maximize the input of sunlight.  Solar trackers were invented in order to adjust the orientation of solar panels to follow the sun`s trajectory throughout the day. For most homeowners, solar trackers do not pass a cost-benefit analysis – they are simply too expensive.The pitch of your roof can be altered with racks. In many cases this will allow your solar panels to stay longer in the sun.

 Temperature

Temperature is not something you have to consider unless you live in very hot areas  As the temperatures increase, the efficiency of solar panels usually decreases a little bit.Professional installers will make sure that the solar panels are positioned to receive sufficient amounts of airflow. This induces natural cooling, which help keep the efficiency rates up.

 Lifetime

The efficiency of solar panels does degrade a little bit over time. The general rule of thumb is that the power output drops by 0.5% every year. Solar panel manufacturers often offer a warranty that guarantees the power output stays above 80% after 25 years.

 Maintenance

A solar system generally requires very little maintenance – especially if the system is grid-tied. However, cleaning the solar panels on a regular basis is recommended. Dust and dirt will affect the efficiency of solar panels if not taken care of. In most places, wiping off the dust with soapy water is sufficient. In some places, the rainfall will do the job for you. Use cleaning services if you`re too anxious to get up on the roof. Best practices would be to monitor the power output of the solar panels to get an idea of how often cleaning them is necessary.

 Solar Panel Efficiency

Efficiency ratings of solar panels are only one of many different factors that have to be taken into account when considering going solar. Solar panels with conversion rates of 8% will need twice the area as solar panels with conversion rates of 16%. This is why most homeowners end up choosing mono- or poly-crystalline solar panels – these have great efficiency rates and are also space-efficient.  Greater the efficiency of the solar panel (and other equipment) greater the overall energy production of the system. Although the most efficient solar panels available on the market have an efficiency of 22.5 percent, most panels are in the 14 to 16 percent range. This difference in efficiency means that one system can have a solar energy output that is 50 percent greater than a less efficient system. Some other associated costs are reduced by greater efficiency, such as racking system equipment, installation and transportation costs. Efficiency in turn fuels greater opportunities to sell more solar generation capacity, as many residential systems are limited by the space available for mounting panels.

Demand

One of the most important factors, and one that the homeowner has the most control over, is the amount of electricity that gets used every month. In a house that has predominantly electric appliances (water heater, stove, central air conditioning and heat, washing machine and clothes dryer, electronics such gaming systems, computers, and home entertainment systems), then the amount of electricity used every month is going to be quite a bit higher than for those whose homes have gas appliances, a solar or gas hot water system, or an intelligent home energy management system (which can help to radically reduce ‘vampire’ energy use and to automate appliance and lighting use for optimal energy efficiency).

Prospective solar homeowners can get an idea of how much their own electrical demand is by looking at their utility bills over the course of a year, and can then calculate how much their average monthly electricity usage in kilowatt hours (kWh) is. This number can give homeowners a good idea about how much solar capacity will be needed, if their desire is to offset all of their home’s electricity use. A home solar system doesn’t have to always be able to generate the full amount, or an excess, of electricity used in the home every month (assuming it’s not an off-grid solar system, which will have to be sized to fit the electric demands of the home, as well as integrate a battery bank for energy storage). Many homeowners looking to go solar may seek to only reduce the amount of electricity they buy from the grid, which can reduce their electricity costs, and a smaller system might work better in their situation and with their budget.

Update:

Possible reduction in solar panel cost:

Chinese researchers have developed a new technique that could boost the efficiency and reduce the costs of making solar cells

The study of scientists from the Lanzhou University, the Ningbo Institute of Material Technology and Engineering, and the Functional Thin Films Research Center at the Shenzhen Institutes of Advanced Technology, was published in the December 2018 issue of the journal Nano Energy.The Chinese researchers say that they have developed a newly emerging technique that could meet the long-time dream of photovoltaic researchers to have high-performance silicon solar cells with low-temperature and solution-based processes only.

The new technique used by the Chinese scientists includes high performance hole- and electron-selective layers (HSL and ESL) for both polarities on silicon substrate. The contact resistivity was dramatically decreased, while a remarkable efficiency of 15.1 percent was achieved, according to the scientists. The new technique to make solar cells could allow solar cells to avoid high-temperature processes, thus making those solar cells lower-cost and more efficient, Peng Shanglong, the head of a research team at Lanzhou University, told Xinhua.“Because of high equipment costs and complex techniques, traditional solar cells have long been limited in use on a large scale,” Peng told the Chinese news agency.

Researchers from Helmholtz-Zentrum Berlin (HZB) said earlier this month that they had experimented with increasing the efficiency of silicon solar cells by incorporating layers of organic molecules into the solar cell. This could potentially abolish the 29.3 percent theoretical efficiency limit for silicon solar cells due to their physical material properties, they say. Researchers at Penn State have been searching for less expensive alternatives to solar cells and found that the properties of an inexpensive and quick-to-produce class of materials known as halide perovskites could lead to more efficient PV materials to replace traditional silicon solar cells.