Reported fair market values for solar projects are continuing to decline.
The median fair market values claimed for utility-scale solar projects of five megawatts or larger in 2017 were $1.60 a watt DC and $2.00 a watt AC, according to the latest “Tracking the Sun” report released by the National Renewable Energy Laboratory in September.
NREL said it did not find the economies of scale it expected when comparing small projects to large projects. There were some. The median price for projects in the 50- to 100-megawatt range was $1.35 a watt. It was $1.49 a watt for projects between 100 and 200 megawatts. NREL said this may be because really large projects take longer to build and equipment costs may have been locked in some time ago.
NREL said these numbers reflect a “top-down approach” of accepting reported market values of completed projects in tax equity deals and direct sales. If a bottom-up approach is used of building up costs to construct, it said the national average (mean) of 100-megawatt projects in 2017 was $1.03 in non-union states and $1.13 a watt in union states.
Wood Mackenzie, a consultancy, said in its “Solar Market Insight” report in September that the average cost to build a utility-scale project with a single-axis tracker was a little over $1 a watt in the first quarter 2018, falling to a little under $1 a watt in the second quarter.
Turning to residential rooftop systems, the national median price in 2017 was $3.70 a watt, according to NREL. It was $3.10 a watt for smaller C&I systems, and $2.20 a watt for larger such systems. The line between small and large is 500 kilowatts.
Installed prices in the US are higher than in other markets. NREL said typical pricing for residential systems in Australia was around $1.80 a watt in 2017, around half the median price in the US. The median price in Germany was lower still at around $1.50 a watt.
Installed prices vary widely among US states. State-level median prices ranged from $2.60 to $4.50 a watt for residential systems, from $2.20 to $4.00 for small C&I systems and from $2.10 to $2.40 a watt for large C&I systems. High prices in California, Massachusetts and New York pull up the averages.
NREL said third-party-owned residential systems, where the solar company retains ownership, have a median installed price that is 50¢ a watt less than where the homeowner buys the system directly. It said this may be because solar companies buy in bulk and face lower equipment costs. It found no difference in C&I systems based on ownership.
Meanwhile, EnergySage, an on-line market for consumers for rooftop solar systems, said in early October that rooftop systems were selling for $3.12 a watt in the first half of 2018 and seven out of 10 buyers want batteries as part of their purchases.
Consultancy Wood Mackenzie put the average price at 3.01 a watt during the same period.
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