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> solar panel cost accounts for ~20% of the overall installed cost in the U.S.[2]. So reducing panel prices by this incremental cost doesn't impact the overall

> solar panel cost accounts for ~20% of the overall installed cost in the U.S.[2]. So reducing panel prices by this incremental cost doesn't impact the overall cost as much as you'd think. So where does the other 80% of the cost come from? Maybe we should be figuring out how to cut that instead.

diafygi 11y ago
There's a nice pretty chart on the DOE's soft costs website. http://energy.gov/eere/sunshot/reducing-non-hardware-costs http://energy.gov/eere/sunshot/reducing-non-hardware-costs It's from 2010, so stuff has shifted since then, but ~50% soft costs, 15% installation labor, 15% non-module hardware, and 20% module. The DOE's really been focused on soft costs (customer acquisition, overhead, engineering, financing, etc.). We recently got a big grant to drive down the cost of getting a customer's bill/usage history for the initial quote, which can impact the overall cost by 5-10%.
- pkaye 11y ago
  Wow these soft costs seem so huge. I was hoping technological innovation would bring down the overall cost of solar but now it looks like that accounts for only 1/3 of the costs. I hope the soft costs can be brought down significantly over time.
  - drited 11y ago
    There is scope for optimism as the Germans are much more efficient on soft costs. Several studies have looked at why the gulf exists between U.S and German costs so people are focused on narrowing the gap. I think it'll happen, maybe from late 2016 when the industry gets super competitive for business as demand drops due to the Itc expiry.
  - brianwawok 11y ago
    It should come down with time, no? I can look in my phonebook and find 500 people to install new electrical wire in my house. I doubt I can find that many people that know how to install solar.. but given a few years, it could/should eventually become fairly common knowledge.
- discardorama 11y ago
  There's something wrong when "customer acquisition" is your biggest expense....
  - rch 11y ago
    Customer acquisition costs should go down as the overall value proposition improves. Good PR on efficiency and domestic manufacturing helps, as will availability of Tesla's Powerwall (10 kWh battery for $3,500).
Zigurd 11y ago
There must be wide differences in these costs from one installer to another. I recently saw two solar installations in western Massachusetts: One was mounted on very sturdy-looking frames bolted to concrete bases. One right next to it was mounted on tubular aluminum "skids" with a stack of three cinderblocks on top of each skid. The cinderblock and bent tubes arrangement looked like a fraction of the cost of the welded frames bolted down. Both were in what looked to be formerly a pasture or hayfield. Both were fenced in with a chain link fence, which I imagine could also be cost-optimized.

diafygi 11y ago

There's a nice pretty chart on the DOE's soft costs website. http://energy.gov/eere/sunshot/reducing-non-hardware-costs http://energy.gov/eere/sunshot/reducing-non-hardware-costs It's from 2010, so stuff has shifted since then, but ~50% soft costs, 15% installation labor, 15% non-module hardware, and 20% module. The DOE's really been focused on soft costs (customer acquisition, overhead, engineering, financing, etc.). We recently got a big grant to drive down the cost of getting a customer's bill/usage history for the initial quote, which can impact the overall cost by 5-10%.

pkaye 11y ago
Wow these soft costs seem so huge. I was hoping technological innovation would bring down the overall cost of solar but now it looks like that accounts for only 1/3 of the costs. I hope the soft costs can be brought down significantly over time.
- drited 11y ago
  There is scope for optimism as the Germans are much more efficient on soft costs. Several studies have looked at why the gulf exists between U.S and German costs so people are focused on narrowing the gap. I think it'll happen, maybe from late 2016 when the industry gets super competitive for business as demand drops due to the Itc expiry.
- brianwawok 11y ago
  It should come down with time, no? I can look in my phonebook and find 500 people to install new electrical wire in my house. I doubt I can find that many people that know how to install solar.. but given a few years, it could/should eventually become fairly common knowledge.
discardorama 11y ago
There's something wrong when "customer acquisition" is your biggest expense....
- rch 11y ago
  Customer acquisition costs should go down as the overall value proposition improves. Good PR on efficiency and domestic manufacturing helps, as will availability of Tesla's Powerwall (10 kWh battery for $3,500).

Zigurd 11y ago

There must be wide differences in these costs from one installer to another. I recently saw two solar installations in western Massachusetts: One was mounted on very sturdy-looking frames bolted to concrete bases. One right next to it was mounted on tubular aluminum "skids" with a stack of three cinderblocks on top of each skid. The cinderblock and bent tubes arrangement looked like a fraction of the cost of the welded frames bolted down. Both were in what looked to be formerly a pasture or hayfield. Both were fenced in with a chain link fence, which I imagine could also be cost-optimized.