ORIGINAL REPORTING: Can the price of rooftop solar keep falling?

Can the price of rooftop solar keep falling? "If prices keep dropping, [rooftop solar] adoption will continue and a smart utility CEO would watch the market and think about ways utilities can have some control over distributed resources."

Herman K. Trabish, Oct. 18, 2018 (Utility Dive)

Editor’s note: Solar prices continue to fall at the slower pace described in this piece.

Rooftop solar's growth has slowed nationally, but its price to customers continues to fall, leaving market watchers questioning its future. In 2017, the installed price of residential photovoltaic (PV) solar continued its 20-year price decline, but at a slower pace than the 2009 to 2013 glory years. Tariffs on imported solar products and the rising cost of finding customers slowed the price decline and flattened growth, leaving installers, policymakers and utilities asking if the price will keep falling and, if it does, how low it will go. Changing solar incentives make this question especially important. The 30% federal investment tax credit will begin phasing down in 2021, which could offset any benefit of tariffs being lifted. In addition, retail rate net energy metering is already slowly being replaced with successor tariffs that provide lower compensation for exported solar generation.

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"Utility executives say they can wait out the growth of PV, now that incentives are being reduced and the price is leveling," Yale University Associate Professor of Economics Kenneth Gillingham told Utility Dive. "But a lot depends on technology costs and it would be a mistake to write rooftop PV off just because of incentive changes." Research shows falling incentives can drive new approaches to customer acquisition, new ways to install solar and new utility engagement, Gillingham said. "If prices keep dropping, adoption will continue and a smart utility CEO would watch the market and think about ways utilities can have some control over distributed resources." The U.S. solar industry is bouncing back after being slowed by the 30% tariff on imported solar modules and cells, imposed in 2018. Utility-scale solar procurement returned to record levels in H1 2018, but residential PV was essentially flat year-over-year, the Q3 Wood Mackenzie-Solar Energy Industries Association market report found…” click here for more

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