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Photovoltaic Systems Installed Price Reductions Have Been Driven Primarily by Declines in Soft Costs.

Recent Installed Price Reductions Have Been Driven Primarily by Declines in Soft Costs.

A period of rapidly falling installed prices began in 2009, prompted by a steep drop in global prices for PV modules. Since 2012, however, module prices have remained relatively flat, while installed prices have continued to fall as a result of continuing reductions in the variety of other, non-module costs.

Reductions in inverter and racking equipment costs constitute roughly 20% of the drop in non-module costs for residential systems in recent years. Much of the remainder can be attributed to reductions in the aggregate set of “ soft ” costs, which have fallen partly as a result of increases in system size and module efficiency, though also because of a broader array of efforts within the industry and among policymakers to target soft costs.

Installed Price Declines Have Been Partially Offset by Falling Incentives.
Cash incentives (i.e.,rebates and performance-based incentives) provided through state and utility PV incentive programs have fallen substantially since their peak a decade ago, and have been largely phased-out in many key markets. Depending on the particular program, reductions in cash incentives over the long-term equate to roughly 60% to 120% of the corresponding drop in installed prices. This trend is partly a response to installed price declines and the emergence of other forms of incentives, however it has also been a deliberate strategy by program  administrators to drive cost reductions in the industry.
Read the whole document here>>https://emp.lbl.gov/sites/all/files/tracking_the_sun_ix_report.pdf
2016.09.06.

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