This article is extremely optimistic about the prospects for solar panels in the years to come:

Solar’s Great Leap Forward

Several fun facts from the article:

- “Chinese solar manufacturing as a whole has increased its capacity from two megawatts in 2001 to over 4,000 megawatts.” A typical city in the United States needs something on the order of a gigawatt of generating capacity. Raleigh, NC and the surrounding area (a top-25 city in the U.S.) gets its power from the Shearon Harris nuclear power plant and it generates about 900 megawatts. However, Shearon Harris runs 24×7 and a solar panel runs far less than that. So China is producing enough solar panels to equip perhaps one typical U.S. city per year with solar panels.

- “In 2004, it cost about $3.20 per watt, on average, to make silicon solar panels. By now, according to solar-industry analysts at Photon Consulting in Boston, a Chinese manufacturer can make them for as little as $1.28 per watt.” What does this translate into in reality? Here are two examples:

1) Buying in bulk – SunTech Power STP260-24/Vb1 260w 24v Solar Panel – Pallets 21 Modules – that is $14,196 for 5,460 watts or $2.60 per watt.

2) Buying one panel – SunTech STP175S-24/Ab-175W Solar Panel – that is $494 for 175 watts or $2.82 per watt.

- “To take just one example, consider that today the solar panels themselves account for less than half the total cost of the technology. The costs of installation, additional equipment such as inverters, sales and marketing by installers, and, crucially, financing will also need to come down.” So the cost of the installed system might be more like $6 per watt when it’s all said and done.

The article talks about “Grid Parity”. It is generally assumed that if the total cost of a solar system can get to $1/watt, we have achieved grid parity. Why is that?

The power company delivers power for $0.10 (10 cents) per kilowatt-hour in Raleigh. A 1,000 watt solar panel delivers 1 kilowatt-hour per hour of full sunshine. Assume there are 5 hours of full sunshine per day on average (this takes into account rainy days, winter days, etc). So a 1 kilowatt panel can deliver something like 1,800 kilowatt-hours per year, or $180 worth of electricity. At $1/watt, it takes 5 or 6 years to recoup the cost of the panel. At $6 per watt, it takes more like 30 or 35 years to recoup the costs, and the panel has worn out long before ever recovering the costs of the panel.

If you live in a really sunny area, and electricity costs are higher, and there are government rebates (i.e. parts of California), the math is more favorable. But it will be awhile before unsubsidized solar panels make financial sense in Raleigh, NC. Still, we are getting closer.

Here is a solar system being installed:

More on the microinverters seen in the previous video:

See also:
- Watching the performance of a real photovoltaic solar roof in action
- Solar energy heats up
- Invention – the cheapest solar power?

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