The Cost of Solar Photovoltaic Systems Fell in 2008

Researchers at the Department of Energy’s Lawrence Berkeley National Laboratory released a new study on the installed costs of solar photovoltaic (PV ) power systems in the U.S., showing that the average cost of these systems declined by more than 30% from 1998 to 2008. Within the last year of this period, costs fell by more than 4%.

According to the report, the most recent decline in 2007 and 2008 is primarily the result of a decrease in PV module costs. In contrast, cost reductions from 1998 through 2007 were largely due to a decline in non-module costs, such as the cost of labor, marketing, overhead, inverters, and the balance of systems.

The study—the second in an ongoing series that tracks the installed cost of PV —examined 52,000 grid-connected PV systems installed between 1998 and 2008 in 16 states. It found that average installed costs, in terms of real 2008 dollars, declined from $10.80 per Watt in 1998 to $7.50/W in 2008, equivalent to an average annual reduction of $0.30/W, or 3.6% per year in real dollars.

The report “Tracking the Sun II : The Installed Cost of Photovoltaics in the U.S. from 1998–2008,” by Ryan Wiser, Galen Barbose, Carla Peterman, and Naim Darghouth may be downloaded from http:// eetd.lbl.gov/ea/emp/re-pubs.htm. The research was supported by funding from the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy (Solar Energy Technologies Program) and by the Clean Energy States Alliance.


Galen Barbose is staff research associate in the Electricity Markets and Policy Group at Lawrence Berkeley National Laboratory.

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