Australian Rooftop Solar One of the Most Cost Effective, Says Report

Last I checked, rooftop solar in the US costs about $2.5-$3.5 per W – $2.5/W if it is a commercial rooftop and $3.5 if it is residential.

For Australia, a Cleantechnical report states that the corresponding figures are $1.6-$1.76/W, which also states that these are Two points I would like to make about this report, though:

  • These estimates suggest costs for US rooftop installations (Commercial & Residential) are $3.5/W & $4.6/W respectively. Solar Mango latest estimates suggest that these are on average $2.5 & $3.5/W respectively.
  • Though the report says it is among the cheapest, it should perhaps say it is among the cheapest when compared to the developed countries, because in countries such as India (where I live), the installation cost for commercial rooftop solar is just above a $1/W. In some of the recent installations that Solar Mango assisted, it was only about $1.1/W. For residential, it could be slightly higher, but not much more – perhaps about $1.2/W.

With the above riders aside, the news about the low Australian rooftop solar installation cost is really awesome. So, the total installed cost for rooftop solar in Australia is just 50% of what it is in the US for residential and about 60% of what it is in US for commercial.

Given that Australia is a costlier economy than the US (at least as measured by per capital GDP), it is intriguing to note such a significant cost difference.

Sure, the economy of India is vastly different from those of USA or Australia, with labour costs (a key component of the total installation cost) being really low. But it will be great if someone could explain why the cost/W in the US should be that much higher than that of Australia.

One of the reasons could be the high customer acquisition costs in the US, which is more than 50 cents/W, according to this post. Assuming the customer acquisition costs in Au are much lower, this could explain the difference to a certain extent, but not fully though – because the gap is $1.75/W for residential systems!

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