Sunday, October 12, 2014

Is solar power still too expensive in United States?

Solar power industry is one of the fastest growing industries in the country but is solar power still too expensive for consumers across the United States? Overall, the prices of solar power installations have been steadily declining but general conclusion is that solar power systems are generally lot more expensive in United States than in much of the Europe.

The recent Lawrence Berkeley National Laboratory report which utilized data from more than 300,000 different residential, commercial, and utility-scale solar installations concluded that solar power prices in United States have fallen year-over-year by $0.7/W, or 12-15% depending on system size range.

Though this is positive trend, it is still considerably behind prices in major EU markets, most notably Germany and United Kingdom. This, however, has a lot to do with the very favorable solar power incentives in Germany and United Kingdom. For comparison purposes installed price of residential PV installations in 2013 was $2.1/W in Germany, while in United States the same price was $4.7/W.

The lowest median installed solar power prices in United States are not in California as many might think it is but in Florida. California has $4.9/W as compared to $3.3/W in Florida.

It also has to be said that according to this report the falling trend has continued through the first six months of 2014., declining in average $0.2/W to $0.5/W.

Is there a room for further decline in the upcoming years? Judging by the broad international experience the answer is yes, because many large European countries have significantly lower prices than those in United States. In 2013, United States added approximately 4,800 MW of new PV capacity, being the third largest PV market in the world, behind China and Japan.