Excerpt, Zach Shahan Clean Technica, Sept 2020
Elon Musk explains Tesla’s lowcost residential solar:
“Solar panel cost is only ~50 cents/Watt. Mounting hardware, inverter and wiring is ~25 cents/Watt. Installation is ~50 cents/Watt, depending on system size.
“The other solar companies spend heavily on salespeople, advertising and complex financing instruments. We do not.”
So, that’s that — Tesla spends approximately 75 cents a watt on the hardware and approximately 50 cents a watt on the installation cost, adding up to ~$1.25/watt. Another 76 cents a watt covers some additional soft costs while also presumably providing a small profit.
There are other operational, overhead, maintenance/repair, and customer acquisition costs, but some of those costs may simply be covered by the rest of Tesla — accounting and legal matters, for example, can just be rolled into Tesla’s broader accounting and legal work/costs. Tesla is now making so much money on the automotive side of the business that it has certain advantages from economies of scale and from its overall financial might that must help to keep certain soft costs out of the rooftop solar power equation. A pure solar company doesn’t have those advantages.
As always, no matter what the averages and superficial price statements are, I do recommend that if any of you might go solar, you should get quotes from multiple installers in your area (they’re always free) and look closely at the details. Contracts are not all the same in terms of timeframe, maintenance, or financing. Of course, if you do go solar with Tesla and you don’t have someone closer to you to get a Tesla referral code from, you are certainly free to use mine — https://ts.la/zachary63404 — in order to get a $100 discount, especially if I convinced you at some point that it’s a good time to go solar.
The price of solar power has gotten so competitive that we’re seeing solar power very high in the rankings for new power capacity in the United States. Utility-scale solar power was by far the #1 source of new power capacity in June, and it was #3 in the first half of the year, just behind wind. However, those results just cover new capacity from large solar power plants. If you assume another 3,000 to 4,000 megawatts from smaller scale solar power plants — like rooftop solar power systems — solar power would have been #1 overall in the first half of 2020. We’ll get those numbers at some point. Once we do, I’ll look closely, because there’s a strong chance solar came out on top.
We still have a long way to go with regards to solar electricity generation in order to significantly cut emissions from fossil fuels. I reported earlier today that solar power accounted for just 3.4% of US electricity generation in the first half of 2020 — that’s 3.4%, not 34%. Rooftop solar power accounted for approximately a third of that, 1.1% of US electricity generation, according to the US Energy Information Administration. Electricity from solar power is growing, but there’s still a long way to go to get to even 10% of US electricity generation.