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State of the PV market in the US
Joachim SeelLawrence Berkeley National Laboratory
December 5th 2012 CEC NSHP staff workshop
For offering comments and/or assistance, thanks to Ted James, Alan Goodrich and Kristen Ardani(NREL), as well as Minh Le (U.S. DOE). This analysis was funded by the Solar Energy
Technologies Program, Office of Energy Efficiency and Renewable Energy of the U.S. Department of Energy under Contract No. DE-AC02-05CH11231.
Table of Contents
• Overview of recent US PV market developments– Capacity additions
– Price development
– Comparison of PV prices and technology on new homes vs. retrofits
• International experiences and opportunities for further cost reductions in the US– Bottom-up cost analysis of residential PV systems in Germany and the
US
2
U.S. Installation Breakdown(Source: David Feldman, Robert Margolis, NREL)
* “Next Four States”: NV, TX, IL, NCSources: GTM/SEIA : U.S. Solar Market Insight Q2 2012. BNEF North American PV Outlook (08/31/12)
• U.S. H1 ‘12 installations: 1,254 MW – double H1 ‘11 installations• GTM & BNEF forecast 2012 U.S. installations to reach 2.9 GW ‐ 3.3GW
• CA had largest quarter ever, driven in large part by Utility sector• BNEF expects future growth in the CA market to come from utility‐scale PV demand, driven by FiT program, and
Renewable Auction Mechanism, for next 3 years• CSI is nearly depleted. Uncertainty as to how this will effect residential market (lower prices and/or less build)• Non‐residential installation market declined in many states, partially due to decreasing SREC prices
3
California217
New Jersey
103 Arizona173
Next Four States*
133
Other116
U.S. PV Installations by State (MWDC), Q2 '12
56 60 63 67 73 69 75 91 98 98 63 64 94 112 168 224 175 257 291
196 22 55 22
167 38 50
227
443
124 447
141 180 178
346 280
343
477
791
512
742
0
100
200
300
400
500
600
700
800
900
Q1 '10
Q2 '10
Q3 '10
Q4 '10
Q1 '11
Q2 '11
Q3 '11
Q4 '11
Q1 '12
Q2 '12
Qua
rter
ly P
V In
stal
led
(MW
DC)
U.S PV Installations by Market Segment
Utility
Non-Residential
Installed Prices Continued Their Precipitous Decline in 2011
4
Median installed prices fell by $0.7-0.9/W (11-14%) from 2010 to 2011, across the three size ranges shown, and have fallen by an average of 5-7% annually since 1998
Note: Median installed prices are shown only if 15 or more observations are available for the individual size range
Link to detailed price study for the US: Tracking the Sun V: http://emp.lbl.gov/publications/tracking‐sun‐v‐historical‐summary‐installed‐price‐photovoltaics‐united‐states‐1998‐2011
Small PV projects on new homes are cheaper in comparison to traditional retrofits…
5
6.00
6.50
7.00
7.50
8.00
8.50
9.00
9.50
10.00
2007 2008 2009 2010 2011
$2011/WDC
Median Prices for PV 2‐3kWRetrofit vs. New Construction in California
CSI racking customer‐owned CSI racking 3rd Party NSHP racking NSHP BiPV
Note: 3rd Party systems only include systems for which a transaction price was paid and exclude “appraised values”
… but more expensive than some 3rd party owned systems
Building-integrated PV projects became less popular during the downtown of the new housing market…
6
0
100
200
300
400
500
600
700
800
900
2007 2008 2009 2010 2011
Count of building‐integrated and rack‐mounted PV systems <=10kWRetrofit vs. New Construction in California
CSI BIPV NSHP racking NSHP BiPV
… but are still more common than in the regular retrofit market.
German residential PV systems are $2.50-$3.00/W cheaper than US systems
7
*Note: German system prices are available based on the date of price quote, rather than by installation date. However, the average time lag between price quote and installation date is much shorter in Germany than in the US., as described further within the secondary analysis
7.367.05
6.806.50 6.44
6.28 6.16 5.90
4.38 4.324.20 4.09
3.67 3.613.26 3.08
2.872.62 2.51
6.30 6.125.78
5.565.11
2.00
3.00
4.00
5.00
6.00
7.00
8.00
2010 Q1
2010 Q2
2010 Q3
2010 Q4
2011 Q1
2011 Q2
2011 Q3
2011 Q4
2012 Q1
2012 Q2
2012 Q3
$2011/W
Installation Date
Median Installed Price of Customer‐Owned PV Systems ≤10 kW*
US system prices
German system prices
CSI system prices
NJ
AZ
Data Sources: US: Tracking the Sun; Germany: EuPD and BSWLink to detailed German‐US cost study: http://emp.lbl.gov/publications/why‐are‐residential‐pv‐prices‐germany‐so‐much‐lower‐united‐states‐scoping‐analysis
Breakdown of Cost Differential Between German and U.S. Residential PV in 2011 (customer-owned systems)
8
Notes: “Profit, overhead, and other residual soft costs” is calculated as a residual term based on the difference between total soft costs and the sum of the individual business process costs quantified through the German and U.S. installer surveys. This residual term includes such items as property‐related expenses (rent, utilities, etc.), inventory‐related costs, additional insurances and fees, and general administrative costs.
3.05
0.010.22 0.24
0.430.62
0.12 0.09 0.21
1.20
0
1
2
3
4
5
6
7
German system
module inverter other hardware
installation labor
customer acquisition and system design
PII permitting fee
sales tax profit, overhead and other residual soft
costs
$ 2011/W
Cost differenc
e of $3.14/W
Thank you for your attention
Renewable Energy Analysis by the LBNL Electricity Markets & Policy Group:
http://emp.lbl.gov/research-areas/renewable-energy
Detailed price study on PV in the US: Tracking the Sun V: http://emp.lbl.gov/publications/tracking‐sun‐v‐historical‐summary‐installed‐price‐photovoltaics‐united‐
states‐1998‐2011
Cost comparison study between German and US systems: http://emp.lbl.gov/publications/why‐are‐residential‐pv‐prices‐germany‐so‐much‐lower‐united‐states‐
scoping‐analysis
Joachim [email protected]
Soft Costs for Residential PV in Germany Are ~$2.7/W Lower Than in the U.S.
10
Total soft costs for residential PV in Germany, including margin, are just 22% of the implied soft costs for U.S. residential PV ($0.67/W vs. $3.34/W)
* Notes: US module and inverter prices are based on average factory gate prices for Q4 2010‐Q3 2011 as reported by GTM/SEIA with an adder of 10% to account for supply chain costs. Inverter efficiency assumed to be 85%.
1.83 1.82
0.55 0.33
0.470.23
3.34
0.67
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
USA 2011 Germany 2011
$ 2011
/ W
soft BoS + profit
other hardware
inverter
module
$3.05
$6.19
Implied soft‐BoS + profit (residual of TTS system prices and hardware costs)
GTM/SEIA
NREL cost modeling H2 2011
LBNL: TTS self‐identified residential systems, excluding 3rd party owned systems
U.S. System Prices are derived from LBNL’s TTS dataset and are equal to the median of customer-owned systems ≤10kW installed in each year. German System Prices are the averages of individual price quotes in EuPD’s dataset (2008-2011) or the average of prices reported by IEA, Photon, KfW, and Schaeffer (2001-2007).
Module Factory-Gate Prices are the average of prices reported by IEA, GTM, IRENA, Navigant, and Photon (annual currency exchange rates were used for module prices estimates)
Differences in Market Size Alone MayExplain Roughly Half of the Price Gap
11
Implied Average Annual Non‐Module Costs* vs. Cumulative Capacity:
Customer‐Owned Systems ≤10 kW, 2001‐2011
• Total non-module costs in 2011 were ~$2.8/W higher in the U.S. than in Germany
• But, at the same cumulative capacity that the U.S. had installed at the end of 2011 (4 GW), non-module costs for residential PV in Germany were only $1.3/W less than in the U.S.
• One might (crudely) infer that theremaining $1.5/W of the total gap in 2011 non-module costs may be due simply to the larger base of German experience
012345678910
100 1000 10000
$2011/W
cumulative national PV capacity installed [MW]
USA Germany
2011
2011
$1.30
$1.50
* Note: Implied average annual non‐module cost = average annual system price minus global average factory gate module price
Summary of Soft Cost Differences for Residential PV in the U.S. and Germany
12
Notes: “Profit, overhead, and other residual soft costs” is calculated as a residual term based on the difference between total soft costs and the sum of the individual business process costs quantified through the German and U.S. installer surveys. This residual term includes such items as property‐related expenses (rent, utilities, etc.), inventory‐related costs, additional insurances and fees, and general administrative costs.
0.34
0.110.24
0.150.09
0.59
0.21
1.61
0.02 0.01 0.04 0.03 0.00
0.16
0.00
0.41
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
customer acquistion: marketing +
advertisement
customer acquisition: system design
customer acquisition:
other
PII labor cost permitting fee installation labor
sales tax profit, overhead, and other residual soft costs
$ 2011
/ W
USA Germany
Profit.28
Comparison of Soft Costs for Residential PV in Germany and the U.S.(customer-owned systems)
