The cost of home solar power could fall even faster than expected in light of a new study by European researchers. Tests by the EU Energy Institute have found that 90 percent of solar panels last for 30 years or longer, a considerable leap from the 20 years generally recognized by banks and lenders. It has long been accepted amongst solar contractors and enthusiasts that the panels will last beyond the 20-year warranties typically associated with them. The EU research provides scientific evidence to back those claims.
The EU Energy Institute performed accelerated aging tests in which solar panels were submitted to extreme heat, cold and humidity. The results show overwhelmingly that panels will survive with limited loss in production for much longer than previously confirmed.
That fact could make financing home solar power systems even easier and bring down monthly payments as lenders could provide longer loan terms with confidence. The cost of solar power equipment is dropping on its own, as shown by a 30 percent decrease last year. That could potentially become 50 percent by the end of 2009. Combine that with a test-supported increase in life span, and the road to home solar power should grow ever wider and smoother in the short term.
Dr. Heinz Ossenbrink of the EU Energy Institute would like to see solar panels financed like a house. With a 40-year life span assured, banks could confidently open mortgages with consumers on solar systems. For, say, 30 years, a homeowner could pay the bank for a home power system that the bank would own until the mortgage terms are satisfied. Given the general cost of a solar power system ($20,000 to $40,000, including equipment and installation), that would lead to very low payments and facilitate an easy, affordable distribution of solar power through global markets.
Whether solar mortgages pop up in major solar markets or not, the combination of long life and falling equipment costs will combine to make prices drop faster than expected. The vast majority of solar costs are incurred up front for equipment and installation with very little maintenance needed. Over time, that solar system will pay for itself through energy saved on utility bills – typically in 10 to 20 years at current prices, and depending on available incentives.
That framework is nothing new. But a proven longer life span for the panels changes the numbers a bit. Averaged out over 30 years rather than 20, the cost-effectiveness of home solar power takes on a new, more lucrative light. Homeowners can feel more secure in the rather large investment that is solar power, and banks can feel more secure in financing a home energy system that is nearly certain to produce beyond the payback period of the loan.
Source: BBC News