Rocky Mountain Institute Releases Solar Cost Reduction Roadmap

Report Charts Course Towards Reaching DOE SunShot Targets by 2020

Snowmass, Colo. — September 25, 2013 — Rocky Mountain Institute (RMI) recently released a report, written with the National Renewable Energy Laboratory (NREL) and funded by the U.S. Department of Energy's (DOE) SunShot Initiative, that examines how to substantially reduce solar photovoltaic (PV) "soft" costs over the next eight years.


The report, Non-Hardware "Soft" Cost-Reduction Roadmap for Residential and Small Commercial Solar Photovoltaics, 2013-2020, charts a pathway to achieve SunShot soft cost targets of $0.65/W for residential systems and $0.44/W for commercial systems by 2020.

Soft costs account for more than 50 percent of total installed residential costs and over 40 percent of commercial costs. The report details the level of effort required to reduce these costs by 2020 across four key areas: customer acquisition; permitting, inspection, and interconnection; installation labor and financing. The report identified residential installation labor as facing the most uncertain near-term path toward roadmap targets.

"Even in light of drastic solar panel cost reductions over the past four decades, rooftop solar systems in the U.S. still are not economically competitive for the vast majority of commercial and residential customers," said Jon Creyts, program director at Rocky Mountain Institute. "Soft cost reductions represent a major challenge and opportunity for stimulating SunShot-level PV deployment in the United States."

The roadmap leverages proven methodologies adapted from the semiconductor and silicon PV technology industries, and offers comprehensive findings from market analysis and interviews with solar industry soft cost experts—including financiers, analysts, utility representatives, residential and commercial PV installers, software engineers and industry organizations—to identify specific cost reduction opportunities.

The report is the first of a series that will track soft-cost reductions and quantify the impacts of innovations. Future work will elaborate and refine soft-cost benchmarks, cost-reduction strategies, and the distinctions among the nation's geographically diverse PV markets with the goal of tracking—and helping enable—progress toward the SunShot cost-reduction targets.

"RMI's vision of an affordable, equitable, low-carbon, and reliable electricity system relies heavily on electricity produced from distributed solar PV," said Dan Seif, a principal at RMI and a co-author of the report. "To make the pace of change required by this vision a reality, these soft costs, in both cost per watt and cost of capital, need to come down—fast."

NREL and RMI are facilitating an industry-driven road mapping initiative, utilizing "working groups" to lower PV soft costs and overcome market barriers. The kickoff meeting will be held immediately prior to Solar Power International on October 21, 2013 in Chicago, IL. To find out more about this kickoff meeting, contact Dan Seif dseif@rmi.org or Kristen Ardani (NREL) Kristen.ardani@nrel.gov.

About RMI

Since 1982, Rocky Mountain Institute has advanced market-based solutions that transform global energy use to create a clean, prosperous and secure future. An independent, nonprofit think-and-do tank, RMI engages with businesses, communities and institutions to accelerate and scale replicable solutions that drive the cost-effective shift from fossil fuels to efficiency and renewables. Please visit http://www.rmi.org for more information.

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