Two detailed reports from the Energy Department's National Renewable Energy Laboratory (NREL) find that solar financing and other non-hardware costs -- often referred to as "soft costs" -- now comprise up to 64% of the total price of residential solar energy systems, reflecting how soft costs are becoming an increasingly larger fraction of the cost of installing solar. (...)
For residential systems, the greatest soft costs were supply chain costs ($0.61/watt), installation labor ($0.55/W), customer acquisition ($0.48/W), and indirect corporate costs ($0.47/W), such as maintaining office management and accounting functions. [Report 1: http://www.nrel.gov/docs/fy14osti/60412.pdf]
[On the other hand, they] found that third-party ownership added $0.78 per watt for residential systems and $0.67 per watt for commercial projects [Report 2: http://www.nrel.gov/docs/fy14osti/60401.pdf]. They also noted three of the main benefits of third-party financing arrangements:
- Third-party financiers offer additional services, such as shopping for systems, maintaining systems, and applying for incentives.
- Third-party financing may effectively lower the levelized cost of energy over time through economics of scale.
- Businesses offering third-party ownership of installations have gained approximately 70% of residential market share in the United States, driving much of the PV demand