Solar Pricing is going down yearly. Is now a good time to buy?
According to the Solar City CEO Lydon Rive, Solar City being the largest Solar System provider in the US, co-founded by Elon Musk and now a wholly owned subsidiary of Tesla Inc., prices of solar will conservatively drop 3%-5% within the next 5 years, similarly what we have predicted.
Rive had a more conservative estimate for prices falling in the next five years, predicting a price drop of just 3% to 5%.
“So not much — you’d be better off going solar and experiencing these savings immediately rather than waiting to go solar,” Rive explained.
The current average cost of implementing solar is about PhP 80,000 / kWp installed. So for a 100 kWp system, this would be about PhP 8m. If we were to assume price drop of 5% after 5 years, the average cost for a 100 kWp system would be PhP 7.6m (saving PhP 400k). Alternatively, implementing the system now, will result into savings of about PhP 6.4m after the same period of 5 years (using PhP 8.00/kWh as the avoided cost and a target annual production of 160,000 kWh, multiplied by 5 years). Deducting the PhP 400k (as it costs more expensive today), the net savings of implementing the system today is PhP 6m.
In order to achieve similar savings by waiting, the cost of solar will have to drop by 80% within the next 5 years.