We recently wrote about a report from the Lawrence Berkeley National Laboratory, located at U.C. Berkeley, that showed how solar installation costs have fallen significantly in the last decade. But the main reason for that has been the hardware itself. Solar panel prices have fallen precipitously in recent years due to the advent of the Chinese solar market, which has created a flood of cheap panels. But soft costs – the other aspects of installation such as labor, marketing, permitting and purchasing – have remained relatively flat, causing some concern that the growth of the solar industry could plateau once panel prices hit bottom.
But there are reasons to believe soft costs can be reduced, mainly because they’re so much lower in Germany. The German solar market has experience lower installation costs – $3.00 versus $6.19 in the U.S. – because of faster permitting processes and lower fees, marketing costs and sales taxes. What’s even stranger is that German solar installers general enjoy higher profits than their U.S. counterparts, as “residual costs” including rent and overhead, are lower.
One way that the U.S. can mimic Germany’s solar successes is to lower the barriers preventing people from getting their solar PV system quickly. It takes roughly 3-4 months to complete an installation in the U.S., while it takes about a month in Germany due to an easier permitting process.
Even without further cost reductions, Bay Area solar power is still makes financial sense for homes and businesses. A residential solar system can significantly reduce or even eliminate your monthly energy bills. For more information, contact West Coast Solar today.