Energy Information Administration<\/a>, you will notice that the US average home tariff increased from 13.85 to 15.42 cents\/kWh during the same period (June 2021 \u2013 June 2022). \u2013 This represents an 11.3% increase in kilowatt-hour prices over 12 months, which exceeds the 7.3% cost increase for solar panels.<\/p>\n\n\n\nTo summarize, solar panels have become more expensive recently, but the savings they offer have increased by an even higher percentage. Electricity prices are rising faster than solar PV system prices, which means their payback period is actually becoming shorter.<\/p>\n\n\n\n
The Solar Market Insight report calculates average solar cost based on\u00a0high-performance PV modules\u00a0such as those with\u00a0monocrystalline PERC<\/strong>\u00a0cells. Their estimate considers all the costs involved in a\u00a0home solar installation:<\/p>\n\n\n\nPV modules<\/li> PV inverter<\/li> Electrical balance of system<\/li> Structural balance of system<\/li> Direct labor<\/li> Design and engineering<\/li> Permitting, interconnection and inspection<\/li> Taxes<\/li> Customer acquisition and origination<\/li> Civil<\/li> Overhead and margin<\/li><\/ul>\n\n\n\nYou may find other sources that consider a wider variety of solar panels in their estimates, including cheaper and less efficient options, and this results in a lower average price.<\/p>\n\n\n\n
Depending on where you live, you may end up paying a much lower price per watt of solar panel capacity. The prices reported by the\u00a0SEIA don\u2019t consider<\/strong>\u00a0financial incentives\u00a0like cash rebates, tax exemptions, tax credits, and Renewable Energy Certificates (REC).<\/p>\n\n\n\nDid you know? <\/strong>Financial incentives are given to the legal owner of a solar PV system. This means you can claim the incentives when purchasing a home solar system in cash or with a bank loan.<\/p>\n\n\n\nYou get no incentives when using leased solar panels or when signing a Power Purchase Agreement (they are claimed by the solar lease\/PPA provider).<\/p>\n\n\n\n
US Solar Power in 2022: Main Challenges and Opportunities<\/h3>\n\n\n\n 2022 has been a unique year for the US solar industry, bringing both major challenges and excellent opportunities.<\/p>\n\n\n\n
The SMI report also provides a market analysis, forecasting how the solar industry could behave in the near future based on these external factors.<\/p>\n\n\n\n
The Inflation Reduction Act<\/strong>, which was signed on August 16, provides generous incentives for solar power and renewable energy in general. There is a long list of incentives for homeowners, but the main points can be summarized as follows:<\/p>\n\n\n\nThe solar federal tax credit was increased from 26% to 30%, which was the incentive rate available before 2020.<\/li> The federal tax credit was also extended for 10 years. The expiration date is now January 2035 (previously January 2024).<\/li> Energy storage systems now get their own federal tax credit, completely independent from the solar tax credit. Previously, only energy storage systems getting 100% of their charge from onsite solar panels would qualify, limiting their applications<\/li><\/ul>\n\n\n\nThere are now federal tax credits for solar manufacturers, which can help reduce the cost of US-made solar products. Before the IRA, tax credits were only available for end users: homeowners and businesses who installed solar panels.<\/p>\n\n\n\n
SEIA and WoodMac estimate that US solar installations will increase by 40% above their previous forecast for 2023-2027, because of the Inflation Reduction Act. \u2014 This represents an additional 62 GW of capacity that would not have been developed without the incentives introduced by the Act. In the case of residential solar power, the growth outlook has been adjusted upward by 7 GW.<\/p>\n\n\n\n
However, the US solar industry faced uncertainty related to import tariffs during the first months of 2024.<\/strong><\/p>\n\n\n\nThe Department of Commerce started an investigation related to import tariff circumvention in four southeast Asian countries: Cambodia, Malaysia, Thailand, and Vietnam.<\/p>\n\n\n\n
According to a petition filed by a small US-based solar manufacturer, Chinese companies were allegedly using these four countries to avoid anti-dumping and countervailing duties (AD\/CVD). \u2014 These countries provide 80% of US solar imports, and the industry was suddenly dealing with the possibility of new import tariffs up to 250%.<\/p>\n\n\n\n
US solar installations were drastically slowed down during the first half of 2022, since many shipments were suspended until the import tariff issues were clarified. Fortunately, the Biden Administration announced in June that no new tariffs would be imposed for two years.<\/p>\n\n\n\n
US solar companies don\u2019t have to worry about new AD\/CVD tariffs in the near future, but those who depend on imports are facing another challenge: Compliance with the Uyghur Forced Labor Prevention Act (UFLPA), which came into effect on June 21.<\/strong><\/p>\n\n\n\nTo bring their solar panel shipments into the US, they must prove that no forced labor is involved, and this includes the extraction of raw materials.<\/li> Since PV manufacturers depend on multiple sources when processing solar-grade polysilicon, obtaining the documentation necessary to meet the UFLPA is very difficult.<\/li><\/ul>\n\n\n\nHome solar installations have been affected less by these issues, since installers can simply switch to local module brands when imported products are in short supply.<\/p>\n\n\n\n
Large developers don\u2019t have this flexibility, since utility-scale solar farms are much more sensitive to price and switching to another brand is unfeasible when thousands of PV modules are already on the way.<\/p>\n","protected":false},"excerpt":{"rendered":"
Solar System Cost For Home The Solar Market Insight Report is a quarterly publication that describes the current state of the US solar industry, providing the latest data on installation volumes and costs. The Solar Energy Industries Association (SEIA) and leading consultancy firm Wood Mackenzie work together on each edition of the SMI report, and the Q3 … Read more<\/a><\/p>\n","protected":false},"author":10,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_kad_blocks_custom_css":"","_kad_blocks_head_custom_js":"","_kad_blocks_body_custom_js":"","_kad_blocks_footer_custom_js":"","_kad_post_transparent":"","_kad_post_title":"","_kad_post_layout":"","_kad_post_sidebar_id":"","_kad_post_content_style":"","_kad_post_vertical_padding":"","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"footnotes":""},"categories":[55],"tags":[],"yoast_head":"\nSolar System Cost For Home - Business Finance<\/title>\n \n \n \n \n \n \n \n \n \n \n \n \n \n\t \n\t \n\t \n