US Residential Solar Systems See Growth in Size, Decline in Price

An annual solar report released by Lawrence Berkeley National Laboratory (LNBL), Tracking the Sun, has made key observations about the residential solar systems in the US. The report records the trends in the US market for close to 2.5 million systems installed in 2021 year-end, along with the preliminary data for the first half of 2022.

Increase in Size Growth

The report finds that residential solar systems in the US are growing as battery attachment rates witness an increase. At the same time, the median installed price of all kinds of PV projects have fallen yet again. This drop, however, is marginal.

For residential PV systems, the median last year touched 7.0kW.

“Most [non-residential systems] are relatively small, with a median of just 33kW in 2021, but roughly 20% were larger than 150kW, and the average size among all non-residential systems was roughly 250kW,” read the report.

Module Power Electronics 

Module level power electronics, including microinverters or DC optimisers, have continued the trend of expanding their share: they denote 94% of residential systems, 81% of small (<100kW) non-residential systems and 36% of large non-residential systems (≥100kW) installed last year.

Notably, almost half (46%) of all large non-residential systems that saw installation in year 2021 were ground-mounted. Only 12% boasted of tracking. The report reveals further information about ground-mounted systems with 13% of small non-residential and 2% of residential systems.

Installed Prices

The report finds that that US median installed prices have dropped by close to US$0.4c/W annually, while also adding that but that price decline has tapered off since 2013, with prices dropping since then at roughly US$0.1c-0.2c/W per year.

Between 2020-2021, median prices plummeted by US$0.1c- 0.2c/W across all three sectors in real, inflation-adjusted terms. This is inspite of the increasing module costs that have created pressure on prices in the last two years. As the report sums up this trend:

“Supply chain constraints, widely acknowledged within the industry as putting upward pressure on prices, may not be fully reflected in prices for installed projects, and are also partly embedded within the inflation adjustment of pricing data into real dollar terms. In nominal terms, median prices residential and large non-residential systems rose in H1 2022.”

National, State Trends 

As per the report, half of all states have reflected a rise in median residential prices from 2020-2021. A large number of states have reflected a fall in non-residential prices.

Median prices for PV systems coupled with battery storage stood at US$0.6-1.6/W higher than for stand-alone PV systems last year across the three customers segments. The report shares:

“Given typical residential PV and storage sizes, this equates to an underlying incremental cost of roughly US$1,200/kWh of storage, which is in-line with average residential storage costs reported through California’s Self-Generation Incentive Program.”

Co-Located Solar-Plus-Storage

The report also provides insights on the trends among paired solar-plus-storage systems, along with an analysis on battery storage attachment rates and system sizing.

The study reports that battery storage attachment rates have been increasing at a steady rate in the residential sector, touching 10% of the data sample as of 2021. Non-residential attachment rates are lower and have changed over the years yet have continued to increase, reaching 4.9% of all systems installed in 2021.

The attachment rate has uneven distribution across the United States. The upward trend in attachment rates such as California is reflective of advancement. Meanwhile, Hawaii reported the largest attachment rates with 93% residential, 59% non-residential in 2021.  Weather extremities like storm Uri  that had drastic implcations for Texas, caused demand for co-located battery energy storage systems (BESS) to rise.

Paired residential systems are continuing to move towards evolution of larger storage sizing over time (approx 42% of systems in 2021 had batteries of minimum 10kW size), paired non-residential systems are decreasing in size. Of the all paired non-residential systems that were installed in 2021,  46% had batteries that were smaller than 10kW.