The Solar Panels You Buy Matter--A Quick Guide for Better Decisions

Solar energy is spreading like wildfire across the country, and consumers looking to buy a $20,000+ system or make a 20-year commitment on a lease need to know a little bit about the solar panels they're putting on their roofs.

But it's difficult to know what to look for in different solar panels, especially when a sales person is knocking at your door. Here are a few tips that should help potential solar buyers.

Efficiency of solar panels matters

Not all solar panels are the same and consumers need to know how efficiency and quality play into their buying decisions. Source: SunPower.

The first thing to consider when looking at a solar installation is the efficiency of the panels. More efficient panels mean you can pack more energy generation on your roof, meaning more savings from your solar system.

Often times, more efficient panels come with a higher sticker price, but that doesn't necessarily mean they won't save you more money over time. Consider the example below. The first example is a 5 kW solar system built with conventional solar panels that cost $1 per watt. Balance of system costs -- all costs outside the panel like labor, inverters, permitting, etc. -- are $2 per watt.

The second example doesn't increase the balance of system cost because those costs will be similar for a larger system with the same number of panels, but the solar panels themselves are now more expensive. I've assumed the panels are $1.25 per watt, 25% more than the first system. But you can see that the larger system leads to a lower overall cost per watt for the solar system because you're packing more energy generation into the same amount of space.

Example by the author based on industry data.

This is just an example of how higher efficiency can lead to lower costs, and this trade-off is worth considering when looking at different solar panels. Higher sticker prices don't necessarily mean higher energy costs over time, especially when quality is considered.

Quality of solar panels matter

In the solar industry, there are a lot of measures of quality, but the best measure is the degradation of a solar panel over time. As a solar panel sits in the elements and generates electricity, it degrades and produces less energy over time. The higher quality the panel, the less it will degrade.

Installers should be able to provide you data on quality, and a data sheet with information about the panel will help, but in general, a mono-crystalline panel is better than a multi-crystalline panel in terms of degradation. Mono-crystalline is generally higher efficiency, too, so they're an option consumers should consider.

Based on third-party testing by PV Evolution Labs, Fraunhofer, and others, SunPower is often named one of the highest-quality panels in the industry because it's a mono-crystalline n-type construction, which increases efficiency even further than competitors and improves reliability.

A 2012 study by Fraunhoffer, they tested SunPower (SPWR -4.84%) and four other manufacturers' solar panels under extreme environmental conditions like heat, cold, mechanical loads, and ultra-violet light. The study found SunPower's panels degraded 1.3% versus 5.4% for conventional panels made by anonymous manufacturers -- even though Fraunhofer said it selected among top crystalline silicon module manufacturers like Yingli Green Energy, Trina Solar, Canadian Solar, Sharp, and Kyocera. In a durability test last year, the same lab found SunPower once again crushed these competitors.  

SunPower put its advantage in the chart below, which shows the initial advantage it has in rooftop solar -- because of efficiency -- and how its advantage over competitors grows over time because of lower degradation and greater durability.

Source: SunPower.

This is an illustration from SunPower, but it shows how higher quality panels will perform better than conventional panels over the full life of a solar system. Remember, these are assets that will last longer than most cars, so quality matters.

Make sure you're happy with your solar choice

If you're considering going solar, you should make sure you get the most out of your system, but also remember to make sure you're happy with your choice. Solar panels can come in different colors, can be installed in different configurations, and the company you're working with matters, too.

SolarCity (SCTY.DL) and Vivint Solar (VSLR) are the two largest residential solar installers in the country, and they use a number of manufacturers for their solar installations. SunPower also offers installations with its own panels. All three offer different financing as well as monitoring solutions for tracking how your system is working.

What's key is making sure you're happy with how the solar system looks, not just the efficiency, quality, or cost. Like buying a car, you'll only be happy with your solar system if you get the complete package. Using the information above can help you become a more educated buyer, a big step in making the right solar choice for you.