Costs of PV modules are getting lower and lower. Industry analysts have found that PV modules are 12 times cheaper than a decade ago and 459 times cheaper than in 1977. Hence, solar energy is very much affordable for businesses and consumers alike. In the US, installations of residential PV systems (or rooftop solar panels) continue to grow rapidly. According to a recent article from BNEF, data from the US Energy Information Administration (EIA) indicate that installations of residential PV systems in the US between January and July this year registered a YoY growth rate of 21%. Even though the COVID-19 pandemic has caused disruptions in the supply chain, it has not dampened demand.
Why has the demand for renewable energy risen during this global health crisis? The BNEF article says that the imposition of shelter-in-place and self-quarantine rules has made people more sensitive about household electricity cost. The increasing demand for energy efficiency and self-reliance during this period of emergency has then led to a wave of home improvements. Nevertheless, regardless of the effect of the pandemic, industry analysts expect that more PV systems will be installed this year than last year due to the ongoing decline in costs of PV modules.
BNEF points out that the home solar market has benefitted from the fierce competition among several solution providers including Tesla, Jinko Solar, Canadian Solar, Array Technologies, and NeoVolta. Tesla, for example, has cut down the price of its residential PV systems to US$1.49/W (after the US tax credit).
In an interview with CleanTechnica, Tesla CEO Elon Musk said that his solar business can pursue aggressive pricing because it has reduced marketing expenditure and secured low-cost financing. In contrast, its competitors still spend a considerable sum on sales teams, advertisements, and complex financial instruments. Musk added that the cost of his PV modules has dropped to around US$0.50/W, and the cost of the balance of system can be as low as US$0.25/W. As for the cost of system installation, it starts at US$0.50/W depending on system size.
NeoVolta is unique among the participants of the home solar market because it is really a provider of energy storage batteries that can be integrated with a PV system. NeoVolta currently collaborates with PMP Energy to sell its products. The orders from PMP Energy for NeoVolta’s batteries have reached US$902,000 in value.
On the whole, the market for residential PV systems in the US has grown significantly in terms of deployment and generation. CleanTechnica has reported that solar PV accounted for 3.4% of the country’s energy mix during the first three quarters of this year, compared with 2.7% in the same period of last year and 2.3% in the same period of 2018. Furthermore, solar PV is projected to account for 43% of the newly added generation capacity in the US this year. Besides Tesla, other US-based solar companies such as Sunrun and SunPower are also expected to capitalize on the recent boom in the residential market segment.
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