This guest post was written by Barry Cinnamon, a widely recognized solar energy expert and consultant and former chief executive of Westinghouse Solar.
A myth persists that solar power is too pricey. The reality is that in many states _ such as California, New York and Hawaii – solar is already cheaper than utility power on a dollar per kilowatt-hour basis. Not surprisingly, by far the biggest factor in the cost of electricity generated by solar is the installation costs for a system.
We can cut these prices in half everywhere simply by eliminating the excessive paperwork it takes to install a photovoltaic or solar thermal system.
Prices have plummeted so much over the past two years that the solar panels and associated supplies cost about $8,000 for a typical 4,000-watt residential system. A qualified solar specialist or electrician should be able to install these panels for about $2,000 given that it’s only about a day of work. The total installed price should be about $10,000, without any tax credits or incentives. That is about the price of a comparable system in Germany.
But the average price of a residential system in the U.S. is about $20,000. So where does the extra $10,000 go? I can assure you that it is not the result of greedy installers, paranoid utilities or greater German installation efficiency.
Studies by the National Renewable Energy Laboratory and by the University of California, Berkeley both confirm that these higher prices are almost exclusively related to the paperwork it takes to “officially” install a standard rooftop system in the U.S. That’s right, government red tape -‐ local, state and federal.