Cost Per Watt (CPW): An Important Measure of Solar Power
Cost per watt (CPW) is one of the key measurements for assessing solar industry cost, which effectively quantifies how expensive it is to install a solar energy system per watt of power capacity. Providing a consistent framework to compare the economic effectiveness of solar systems and technologies.
Understanding Cost Per Watt (CPW)
The lower the cost per watt (CPW), the cheaper your solar system will be. CPW is affected with the following:
Efficiency of Panels: If panels are efficient, fewer will be needed to cover rooftop space reducing the total costs.
Installation Costs → Labor costs, permits, or other installation-related expenses → CPW
Incentives and Rebates — Government incentives and rebates can help lower the cost of installation considerably.
Financing method (the cash purchase, loan and lease,) used with a given method of financing is able to change effective CPW.
Economies of scale further reduce CPW for larger systems.
The Importance of CPW
Consumer Price Willingness To Pay: A lower CPW means solar becomes cheaper and more appealing to consumers.
Competition: Each solar company will do their best to limit their CPW if they want to stay relevant in the market.
Government Policies: A government has some impact on a CPW, and it can bring this about by giving incentives to organizations or setting mandatory regulations.
Trends in CPW
The CPW for solar energy systems has decreased dramatically over the last 10 years due to technological improvements, economies of scale and better competition. As a result, solar energy became increasingly affordable for more consumer demographics.
Future Outlook
CPW will also continue to decrease as solar technology evolves. Lower costs will result from enhanced production techniques, new materials and greater automation. Moreover, due to the increasing demand for solar energy and government policies promoting such technologies prices will decrease.
With the above in mind along with the CPW and others, individuals & businesses can be more conscious while investing into solar power. Chances are solar power is ready to step in as CPW continues waning.