US utility-scale solar prices to fall below USD 1/watt in 2020

Author: Team Massachusetts 4D Home. License: Creative Commons, Attribution 2.0 Generic.

June 1 (SeeNews) - The price for large fixed-tilt ground-mount solar parks in the USA will fall to USD 0.99 (EUR 0.89) per watt by 2020, which is below the USD 1/watt targeted by the SunShot initiative, GTM Research says.

Currently, the price of utility-scale solar is around USD 1.25 per watt. Photovoltaic (PV) modules account for half of the cost, other components for 22%, and soft costs for 28%.

The table shows solar prices per watt direct current (DC) for the first half of 2016 from GTM’s report “U.S. Solar PV Price Brief H1 2016: Pricing, Breakdowns and Forecasts”.

Type of system Price (in USD)
Utility fixed-tilt 1.25
Utility tracker 1.35
Commercial 1.88
Residential 3.00

GTM Research expects commercial solar pricing to drop by 25% between 2015 and 2020, while the decline in the residential segment is seen at 30%.

Overall, reductions in soft costs will be the main reason for the lower prices in 2020. According to the research firm, soft costs present both the biggest opportunity and the most significant hurdle for future cost reductions, especially in the residential and commercial segments.

In residential PV, soft costs account for 64% of the total system cost today. By the end of the decade that share will remain high, at about 60%, GTM says. In commercial installations there are also opportunities to cut costs further.

“Commercial PV installers need to find more ways to shorten the length of the project cycle and de-risk aspects of the project cycle in order to substantially reduce origination and overhead costs,” said Ben Gallagher, solar analyst and lead author of the report.

(USD 1 = EUR 0.899)

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Browse all articles from Tsvetomira Tsanova

Tsvet has been following the development of the global renewable energy industry for almost nine years. She's got a soft spot for emerging markets.

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