If it was between $3 and $8, you probably didn’t think twice about the greenbacks you pulled out of your wallet. But what if that sandwich had cost $20 or $25? You’d probably wonder where each dollar was going and why on earth the restaurant was charging so much.
When we buy things, we don’t usually break down the cost to see where the dollars are going, but we also don’t buy things that are tens of thousands of dollars every day (thank goodness).
People often grumble about the price of solar electric systems. And yes, $30,000-$60,000 to buy a solar electric system – instead of using a solar service or a lease – is a LOT of money. It’s only reasonable to want to know where your money is going, so here’s the story:
- Solar panels account for about 60% of the cost – they’re mostly made up of pure silicon, which is expensive and takes a long time to make.
- The inverter makes up about 10% of the cost
- All the other parts, like wires and racking, is about 15% of the cost
- And labor is also about 15% of the cost (but don’t starting your own DIY Solar Project just yet!)
Before you get too hung up on calculating 15% of $30,000, though, chew on this:
When you buy a solar electric system, what you’re doing is paying in advance for electricity you’ll get in the future. Basically, you’re paying for 25 or 30 years of power all at once (which may or may not make sense, but that’s another discussion). If you divide it up, what you’re paying every month for solar power for the next 25 years will be less than what you’d pay the utility company in that same time.
So the real trouble is not so much breaking DOWN the cost of solar but breaking UP the cost of solar! And that’s of course what we’re here to help with.