Not so long ago Sunpower’s 20+ % efficiency modules were seen as high end niche products. Last week Solar City announced that they had leapfrogged that benchmark with their 22% modules currently rolling off of their 100 MW lines and soon to be rolling of their 1 GW line at Elon Musk’s ‘other’ gigafactory. With multiple vendors at GW scale with above 20% efficient modules, PV has reached the point of commoditizing high efficiency modules and the ripple effect on system level costs has profound implications.
Adding fuel to the fire, in a recent Cleantechnica post, Panasonic shot back with their announcement of production prototypes testing at 22.5% efficiency. And the longtime leader, Sunpower, is in the process of upping their game with 23% efficient modules planned for production in 2017 in their fab 5. Fab 5 which at a planned 800MW (.8GW) is also at the GW scale and rivaling Solar City’s fab in capacity.
The importance of these announcements cannot be underestimated. Solar City has long stated that their plan is for their residential PV systems to be cost competitive without subsidies by the time US tax credits expire. Low cost, high efficiency modules offer the path by reducing the physical size of solar arrays and the size related costs.  The benefits of high efficiency include reduced footprint and reduced balance of system costs on a dollars per kwhr basis and amortization of fixed costs over a larger system capacity.
Many residential systems are limited by roof space not desired capacity. And a substantial fraction of the cost of residential systems is fixed. As such, by increasing the array capacity those costs can be amortized over a larger project. This reduces the cost per watt and therefore the cost per kwhr. As module prices have dropped Balance of System costs for racking, wires etc. are contributing a larger percentage of system costs. Because more efficient modules provide more energy per square foot, they reduce the cost of balance of system components on a dollars per watt basis. This explained clearly in this article which includes an easily understood graphic showing how the economics play out. And things have only gotten better since it was written. High efficiency modules are coming in lower than $1.00 / W further amplifying the benefits.
With high efficiency modules soon to be rolling off gigawatt scale assembly lines, Solar City’s vision of PV reaching grid parity even as incentives are phased out, appears to be coming to pass. And in volumes with global significance. Clearly the industry is rapidly transitioning to greater than 20% efficiency as the new normal. And with it, the brass ring of cost effective solar without subsidies is rapidly coming within reach.
Source: The Handleman Post. Reproduced with permission.