Economic Lifetimes of Solar Panels

Almost all solutions addressing global warming and sustainable development depend on CO2 emission reductions from increased Photo-Voltaic (PV) power production. Despite the recent growth in PVinstallation in residential and larger-scale settings, deployments of solar panels will continue to accelerate over the near future, spurred by several factors. These include (i) the decrease in panel costs because of improvements in basic technology as well as manufacturing and scale efficiencies, (ii) the promotion of the technology by governments through subsidies for initial installations, (iii) the increasing conversion efficiency of solar panels, and in some cases, (iv) the increase in power costs because of a cessation of low-cost, high-emission generation methods. It is acknowledged that not much attention has been devoted to the end-of-life options for solar panels. The life of most commercially available panels is stated to exceed twenty years, and the lack of urgency in finding solutions may in part be attributed to the anticipated delay by which solutions are thought to be needed. In this paper it is demonstrated that based on economic considerations and recent trends of costs and technology improvements, it may be optimal to replace existing panels in as few as seven years. Thus, the “tsunami” of end-of-life solar panels may happen much sooner than anticipated, heightening the urgency for finding end-of-life solutions for solar panels. The analysis in this paper can also be used to evaluate the effects of subsidies for PV installations.