Solar Photovoltaic Costs Continue to Plummet - SolarStar

Despite the performance of solar stocks over the past two years, the fundamental cost of installing solar PV  power continues to fall rapidly. Long term, this is great for the industry and should drive sales and eventually (surviving) solar stocks higher in the future.

The question is, when will we pass grid parity, and when will demand be self-sustaining? The answer may surprise you.

A long way in two short years

The latest numbers out of GTM Research show that in the U.S. utility scale solar PV has driven the cost reduction over the past two years. The cost for these installations has fallen 54.8% since the first quarter of 2010, driven by massive projects being built byFirst Solar  and SunPower .

What hasn‘t fallen nearly as quickly is the cost of residential solar. These installations vary across the country, so there are likely locations where the cost is lower, but we do know that the regulatory environment and financing has hampered this progress for residential solar. These "soft costs" can add up quickly and will be a major area of focus for the industry in the next few years.

The president’s SunShot program is trying to address some of these costs, including installation, design, permitting, and financing of solar PV  projects. States are also taking on the task with Vermont being one to institute a 10-day approval period for solar installations.

Solar has a long way to go when it comes to cost, but it’s also come a long way in two years.