The U.S. Department of Energy’s SunShot program has just kicked off a new round in a $10 million solar power competition designed to lower the cost of solar power, pretty much down to where a small rooftop solar installation could be a reasonable investment for practically anyone in the country. If you’re thinking that means building a better solar cell, that’s not it. Instead, the Most Affordable Rooftop Solar Prize is aimed at encouraging the solar industry to figure out ways to lower the “soft costs” of solar power.
Hard Cost of Solar Going Down…
Overall, the Department of Energy estimates that the cost of solar cells and other hardware has dropped by a whopping 400% in the past four years. Even more savings are in store as new high-efficiency solar innovations come on line, along with new low-cost solar cell manufacturing processes.
…But Soft Cost of Solar Stays Up
The sticky wicket has been soft costs, in the form of licenses and permits, installation procedures such as connecting to the grid, and routine maintenance. Those typically account for more than half the cost of a small-scale rooftop solar installation (and why solar is almost twice as cheap in Germany as it is here in the U.S.).
Cutting soft costs might seem relatively easy compared to coming up with the next cutting-edge solar cell breakthrough, but according to the DOE, soft costs have remained “stubbornly high.”
The DOE hopes the temptation of cash prizes will break the logjam. The goal of the new competition is to push soft costs down by more than 65 percent, which will put the solar industry on track to bring soft costs for small-scale residential solar systems down to about 60 cents per watt by 2020.
At that price point, small-scale rooftop solar systems will be competitive with fossil fuels (at wholesale electricity prices).
So, Who Wins the Prize?
The Most Affordable Rooftop prize will go to the first three teams that can hit two benchmarks ending in 2015.
In the first phase, qualifying teams must install 5,000 individual small scale rooftop systems of between 2 and 15 kilowatts, with an average of $1.00 (or less) in soft costs.
The second phase is designed to ensure that the qualified teams have a sustainable business model. It calls for an additional 1,000 installations.
The overall winner gets $7 million and bragging rights to the “America’s Most Affordable Rooftop Solar” name, which of course could be worth much more as a promotional tool.
The real winners, though, are the thousands of U.S. workers who stand to gain from the green jobs generated by the small-scale solar power industry.
Follow me on Twitter: @TinaMCasey.
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