What is Solar Panel Efficiency? (2024) – MarketWatch

Although high-efficiency solar panels are more expensive, they offer several advantages. Plus, your electricity savings from going solar can help you recover the higher upfront cost over time. Here are a few benefits of high-efficiency solar panels:

Use Space More Effectively

Since high-efficiency modules convert a higher percentage of sunlight into electricity, they allow you to use roof space more effectively. For example, compared to 10% efficient panels, 20% efficient panels can generate twice as much electricity per square foot. In other words, high-efficiency solar panels produce more energy using fewer panels.

If the area available for your PV array is limited, you can achieve maximum power output with monocrystalline solar panels.

Offer Higher Energy Savings

Monocrystalline panels have a higher efficiency and wattage than polycrystalline panels of the same size. For example, when comparing 60-cell solar modules, you might find a 300-watt (W) poly panel versus a 370 W mono panel. Here’s an example of how solar panel wattage can impact your system size and energy savings:

• If you have space for 20 panels on your roof, you can reach a total system wattage of 6 kilowatts (kW) with polycrystalline panels and 7.4 kW with monocrystalline panels.
• With favorable sunlight, the 6 kW system can generate over 9,000 kWh of usable electricity each year, but a 7.4 kW system can generate over 11,000 kWh.
• Assuming you pay an electric tariff of 16 cents per kilowatt-hour (kWh), the 6 kW system can save around $1,440 in annual electricity bills, but the 7.2 kW system saves around $1,760.

The average cost of solar panels is $2.85 per watt, according to our March 2023 survey of 1,000 homeowners with installed solar. Since monocrystalline panels have a higher wattage, they also cost more than polycrystalline panels. However, the price difference is minimal when you compare both panel types in terms of cost per watt.

Less Impact from High Temperatures

All solar panels suffer a small loss in wattage as they heat up. This effect is temporary — panels recover the lost productivity once they cool down. However, when you constantly expose solar panels to hot weather, the loss of production can add up over time. As a result, hot temperatures can result in a 10% to 25% decrease in solar panel efficiency.

Solar panels have a metric called the temperature coefficient, which describes the negative effect of heat. For example, a panel with a coefficient of -0.40% per Celsius degree will lose 8% productivity with a temperature rise of 20°C. On average, monocrystalline panels have lower temperature coefficients than polycrystalline panels, which means they are less affected by heat. This is a major advantage in warm regions where hot temperatures can impact solar panel performance over time.

Qualify for Higher Solar Incentives

Many solar benefit programs calculate financial incentives by the per-watt capacity of your solar system. Since high-efficiency panels have a higher wattage, they can qualify for higher incentive amounts. However, this does not apply to incentive programs with fixed rebates.

The federal solar tax credit is a nationwide incentive that allows you to claim 30% of your solar system costs as a tax credit for the year you install panels. Since monocrystalline panels cost more, your total system cost will likely be higher than if you used polycrystalline panels. As a result, you will see a higher tax incentive per panel.

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