Soft Costs Are a Big Savings Opportunity for US Solar PV Installations

July 17, 2014 By Karen Henry

PV-soft-costs-energy-manageThe US can substantially improve its average installation efficiency of distributed solar photovoltaic (PV) capacity, according to a new study released by the Rocky Mountain Institute (RMI) and the Georgia Tech Research Institute (GTRI), “Lessons from Australia: Reducing Solar PV Costs Through Installation Labor Efficiency.”

RMI and GTRI compared installed small-scale solar generation costs in the US to costs in Germany and Australia and found that total installed costs and soft costs in Germany and Australia are a fraction of what they are in the US. In Australia and Germany, total soft costs, which comprise about 50 percent of the total cost of installation, are $1.20 and $0.97 per watt installed, respectively. Total soft costs in the US, however, are $3.38 per watt installed.

The US has the potential to streamline its labor hours per kW from 9.4 to about 7 and begin approaching world-leading installation rates of 4 to 6, thus reducing the soft costs that make up two-thirds of the installed cost of US PV systems. This efficiency is possible through four interventions:

  1. Optimizing the pre-installation process.
  2. Redesigning the base installation process for asphalt shingle and tile roofing applications.
  3. Utilizing integrated racking and mounting systems to reduce and eliminate non-value-add activities.
  4. Reducing the number of separate meters to monitor the PV system output.

These improvements will help installers increase efficiency, reduce cost, and make one-day installations common in the US, resulting in additional cost reductions throughout the PV installation value chain, according to the study.

The US, Australia and Germany comprise over 39 percentof total global distributed PV generation capacity, with 6.1 GW, 3 GW, and 21.4 GW of installed small-scale solar generation, respectively.

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