Exploring U.S. Solar PV Prices: NREL 2023 Benchmarks
- Discover how the Inflation Reduction Act (IRA) influenced the US photovoltaic market in the past year, including significant cost reductions for residential systems and benchmarking of Community Solar. Get the new bottom-up PV and storage cost model from NREL and the Department of Energy.
In the past year, the photovoltaic market has seen various changes. The National Renewable Energy Laboratory (NREL) has released its annual cost breakdown of installed solar photovoltaic (PV) and battery storage systems which show that residential systems have seen a 15% reduction in price while utility-scale systems have seen an 8% increase. This is because of the Inflation Reduction Act (IRA) tax incentives to manufacturers for domestically producing and selling clean energy components. Additionally, Community Solar cost benchmarking was done for the first time, taking into account subscriber acquisition and management expenses. To further increase transparency and expand component-level detail, NREL developed a new bottom-up PV and storage cost model in collaboration with the US Department of Energy Solar Energy Technologies Office. The cost data and model are available to the public.
What Impact Has the IRA Had on PV Prices?
- The IRA has incentivized manufacturers to produce and sell clean energy components at a reduced cost, resulting in 15% reduction in residential PV system prices and 8% increase in utility-scale system prices.
- The cost data and model developed by NREL in collaboration with the US Department of Energy Solar Energy Technologies Office are available to the public, increasing transparency in the PV market.
- Community Solar cost benchmarking, which takes into account subscriber acquisition and management expenses, was done for the first time.
- The IRA has also allowed manufacturers to access funding for research and development of new clean energy technologies. This has allowed them to create more efficient and cost effective PV systems that can be deployed across the United States.
- The IRA has led to increased innovation in the PV market, with manufacturers creating new designs and technologies to help reduce PV costs.
- The introduction of the IRA has also encouraged more competition in the PV market, as manufacturers are now competing to produce the highest quality and most cost-effective PV systems.
