Solar Panel Prices Falling Fast Around The World (Number Fun)

  • Published on August 11th, 2013 by

We’re in the midst of a massive cleantech revolution. Solar power is beginning to disrupt the hell out of the power industry. Electric vehicles are on the verge of putting gasmobiles to sleep. Wind power is already one of the cheapest options for new electricity generation in the world — if not the cheapest. The movement is exciting to watch. And, in a decade or so, we might need to change our name from Solar Love to Electricity Love. The solar revolution is certainly one of the more exciting things to watch. Below is some solar number fun that should get your blood pumping. Full disclosure: much of the legwork for this piece was done by one of our excellent readers — we’ll just call him Solar Love advisor #1.

Low Solar Prices Around the World

EU solar without subsidies as low as $1.20/watt: Deutsche Bank has reported that about ⅓ of small- to mid-sized solar installations in the EU are now going in without subsidies. Furthermore, “Multi-megawatt projects were being built south of Rome for €90c/W,” as RenewEconomy notes. “This was delivering electricity costs (LCOE – with 80 per cent self consumption) of around €80/MWh (€8c/kWh).” That’s about $1.20/W and 10–11¢/kWh.

UK solar down to $1.59/watt: The UK’s largest solar far, a new 34-megawatt solar farm near Leicestershire in the English Midlands, is said to cost just over one pound a watt ($1.59/W). That’s about 20% less than the UK’s Department of Energy and Climate Change number for large-scale solar in 2012.

Spain unsubsidized solar down to $1.47/watt: A completely unsubsidized 250 MW solar farm being developed in the northwestern region of Cádiz, Spain, is reportedly going to come in at €275 million, which would be about €1.1/watt or $1.47/watt.

Germany’s average solar PV price at $2.08/watt (unsubsidized): The Photovoltaik-Preisindex from has the average solar power system price in Germany (including utility, commercial, and residential solar PV system) at €1.56 ($2.08) in July. The lowest price it hit on that index was €1.50, or $2.00/watt, in February.

India solar farm comes in at $1.52/watt: Shifting over to India, the price is not all that different from the UK and Spain. A 100-megawatt solar farm in the Ramanathapuram district of Tamil Nadu is supposed to cost ₹920 billion ($15.16 million at the moment), which would be about $1.52/watt.

Australia getting/giving rooftop solar for as low as $1.90(USD)/watt for residential solar (before subsidies): Since I’ve used USD above, I’m using it here, too. Solar Choice’s July Solar PV Price Index indicates a before-subsidy low of AUD$2.06/watt (USD$1.90/watt) for residential solar. After relevant feed-in tariffs, the low is AUD$1.38/watt (USD$1.27/watt). The AUD$2.06/watt low was in both Western Australia and Tasmania. The after-subsidy low of AUD$1.38/watt was in Western Australia (Perth). After incentives, the average price of residential solar down under was AUD$1.76/watt (USD$1.62/watt) in July. Impressive.

Translating To ¢/kWh, And The US Situation

The $/watt numbers are interesting, but what we often want to know is actually ¢/kWh. That helps us compare to our electricity bills and to other types of power plants. To do a location-based comparison, we also need a solar insolation map. Given that the largest number of our readers are American (as well as the two of us writing this article), we’ve decided to focus on the US in this section.

solar insolation US

Using 20-year, 5% financing, the EIA’s 1c/kWh projection for fixed O&M (no subsidies), and the US solar insolation map above, we get these numbers:

$1.20/W =

  • 7.3¢ per kWh in Zone 5 (4.2 solar hours, 17.5% capacity — Northeast/Midwest)
  • 5.8¢ per kWh in Zone 2 (5.5 solar hours, 23% capacity — Southwest)

$1.50/W =

  • 8.3¢ per kWh in Zone 5
  • 7¢ per kWh in Zone 2

$2.00/W =

  • 11.4¢ per kWh in Zone 5
  • 9.9¢ per kWh in Zone 2

To put that into better perspective, the average price of electricity in the US was 11.8¢ per kWh in May, according to the EIA. (And, assuming 3% inflation, the 20-year average cost of electricity would be 16¢ per kWh.)

  • In New York, the average price of residential electricity was 18.3¢ per kWh.
  • In Illinois, it was 10.5¢ per kWh.
  • In Michigan, it was 14.2¢ per kWh.
  • In Florida (which is in Zone 4 of that solar insolation map), it was 11.3¢ per kWh.
  • In California (which is mostly in Zone 3, but partly in Zones 1, 2, and 4), it was 15.8¢ per kWh.
  • In Texas (which is mostly in Zone 3, but partly in Zone 2), it was 11.2¢ per kWh.

In other words, the average price of residential electricity in the above states (and the US on average) is considerably higher than solar at $1.50/watt or even $2.00/watt over 20 years, and the case would get even better if you included the rising electricity prices that are projected by basically everyone in the industry. (For non-residential electricity prices or prices for other states, check out the full EIA spreadsheet.)

Basically, when we could get to Australia’s or Europe’s solar price level, solar will blow up across the US even more so than is happening today.

What are the best US solar prices we’ve seen?

We’ve seen 5.8¢ per kWh in New Mexico after federal and state solar incentives, and about 10.8¢ per kWh before those incentives. Across all sectors, New Mexico retail electricity was 8.8¢ per kWh in May. In the residential sector, it was was 11.2¢ per kWh; in the commercial sector, it was was 9.2¢ per kWh; and in the industrial sector, it was 6.1¢ per kWh.

We’ve seen 6.9¢ per kWh in Palo Alto, California, after federal solar incentives, and about 9.9¢ per kWh before those incentives. Or, in a slight variation on those numbers, John Farrell writes: “the city of Palo Alto is buying subsidized electricity at 7¢, with an unsubsidized cost of 12¢ per kWh. For most residential electricity customers, this is still better than their marginal electricity price, which is between 13¢ and 17¢ per kWh. So Palo Alto, with relatively high rates and abundant sunshine, has already reached ‘Unsubsidized Solar Parity’.” (Notably, Palo Alto has seriously streamlined the “putting solar panels on your roof” process, and the city government has committed to purchasing 100% renewable electricity.)

I’m sure there are many more stories like these. The costs for many projects aren’t often revealed publicly. Notably, however, those two examples above are for large solar power plants. Still, in Q1 of 2013, US residential solar system prices were seen for less than $3.00/W. That would be less than 14.8¢ per kWh in a Zone 2 region, beating the 20-year average price of residential electricity (with 3% inflation) in all Zone 2 states (Arizona, New Mexico, Colorado, and Texas would be 15.9¢ per kWh; Utah would be 15.7¢ per kWh; Nevada would be 16¢ per kWh; and California would be 16.6¢ per kWh).

And, to be honest, your solar panels should last well over 20 years, even well over 30 years, and after a 20-year payoff the electricity becomes essentially free.

Ah, EIA Projections…

So, just to give a sense for how behind the times, the EIA can be, it is projecting US solar will be 13¢ per kWh in 2018, even using 30-year solar system lifespans.

To reiterate, Palo Alto got a solar farm for a cost of 9.9¢–12¢ per kWh (before subsidies) through a 30-year PPA, and New Mexico got one for 10.8¢ per kWh (before subsidies) through a 25-year PPA … 5 years before 2018.

Be cautious whose solar price projections you use.

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About the Author

is the director of CleanTechnica, the most popular cleantech-focused website in the world, and Planetsave, a world-leading green and science news site. He has been covering green news of various sorts since 2008, and he has been especially focused on solar energy, electric vehicles, and wind energy since 2009. Aside from his work on CleanTechnica and Planetsave, he's the founder and director of Solar Love, EV Obsession, and Bikocity. To connect with Zach on some of your favorite social networks, go to and click on the relevant buttons.
  • Tsrinivasan Thirupathi

    Hi There,

    This is Srinivasan Tirupati I like to start solar power product business in India, like solar motors for agriculture, solar power for Homes and small industries with good technology. I like to start with Germany product solar systems, please guide me how to proceed.

    Thank You


  • Kie

    I predict that so much wind and solar power is going to get installed that it will have a knock on effect and cause energy prices not to rise over the next few years!!!

    • stucrmnx120fshwf

      I agree, the amount of solar has grown, by 48 times in the last decade, the price per kWh fell by 200 times between 1975 and 2013, as solar gets much cheaper than carbon dioxide emissions based power, take up will be enormous. The Earth’s surface provides enough area to harvest 7,000 times as much energy as we currently use, just 25% of the world’s deserts, could supply us with 25 times as much power, as we currently use. Here in Australia, we have 1/10 th of the population of the United States, but 10 times as much desert, that’s 100 times as much desert per citizen, or 2,500 times as much energy as we currently use. We could export a trillion tonnes of liquid hydrogen per year, or feed the entire world using high rise farming, LEDs the other side of the photo voltaic physics, means high efficiency, useful spectrum lighting for agriculture.

      The common misconception is that energy and transport can’t change rapidly, in fact they not only can, but they just did, the price of oil, gas, coal have recently plunged, due to unconventional techniques. Such as fracking, shale oil, tar sands, solar prices are falling more rapidly, than carbon dioxide emissions based power prices. In transport, most of the shift from airlines in China, to high speed railways, occurred in 5 years, from 2008 to 2013 and now they’re embarking on massive international intercontinental high speed railway exports. Further if we look at the peak decade of the 2nd industrial revolution, 1915-25, horses disappeared from the cities of the developed world, as did gas lighting. Now we enter the peak decade of the 3rd industrial revolution 2015-25, where solar, electric cars, liquid hydrogen powered aircraft, (light composite aircraft can use light efficient LH, where as heavy metal aircraft, have no choice but to use dense inefficient kerosine.) Come to the fore, electricity prices in fact will rapidly fall, along with battery prices, we’ll see induction charging for electric cars, much more convenient, the cost of smelting steel and aluminum will plumet.

      Take a look at Australia’s concentrated cooled high and low frequency solar power systems, with 1/350 th of the surface area of expensive solar cell material needed, at 40% efficiency. Plants have 4% efficiency, give them the spectrum they need and the efficiency soars, water them with reverse osmosis desalination fertilized mist on their roots (aerophonic’s.) Industrial revolutions are all about energy, transport and agriculture, those long ago revolutions, like the invention of fire, the agricultural revolution 10,000 years ago, drastically changed our lives.

      So will solar, all energy is solar, we’re just going to remove the middle man, geological compression, supernova remnant fissile material for energy, photovoltaics to photovoltaics for agriculture. With the side effect of removing CO2 from power and transport, where high rise farming and liquid hydrogen production in cities, produces O2, where high rise agriculture actually removes CO2 from the cities. 1915-25 massive increase in sewerage works, clean water, garbage disposal, drastically reducing infectious diseases, the main cause of death. 2015-25 removal of soot, smog, CO2, introduction of oxygen industries, clean higher quality food, reducing cancerous disease, the main cause of death, at each peak decade of industrial revolution, a gain of around 20 years of longer life.

      Instinctively most people will say no it can’t happen that fast, that’s just because we’ve been brainwashed by 4 decades of the Great Stagnation in the developed world, no such thing has happened in the developing world, since the end of the cold war, their economies have boomed, like the roaring 20’s. When solar goes below a quarter of the price of carbon dioxide emissions power, the whole world will boom, just like a century ago.