Does Solar Panel Efficiency Matter? (Spoiler: Not as Much as You Think)


We love talking about solar panel efficiency!

Scientists love it. The media love it. Salesmen love it. With all the love going around, one might end up thinking… oh, I dunno, that solar panel efficiency is the be all and end all of everything.

Here at Understand Solar, we’re on a noble endeavor to find the truth. So frankly, we don’t care what everyone else thinks. We’re gonna tell you how it is.

So let’s cut straight to the chase.

If you want to get the most out of your money, you shouldn’t be worrying about efficiency. It’s NOT THAT IMPORTANT.

And as I can sense the torches and pitchforks already, allow me some internet real-estate to explain myself.

How to compare solar panel efficiency

First, what do we mean by efficiency?

Efficiency is the percentage of solar energy that a solar panel converts into DC electricity. So a 10% panel converts 10% of sunlight into electricity.

Question: Panel A is 19% efficient. Panel B is 20% efficient. How much more sunlight does Panel B utilize than Panel A?

You might be tempted to say Panel B uses 1% more sunlight than Panel A and thereby that Panel B is 1% better than Panel A. But this isn’t the case.

Let’s pit Panel B with 20% efficiency against a new panel: Panel C with 10% efficiency. Under the same conditions, panel B will produce twice as much power than panel C. Clearly, the performance difference is not 10% – Panel B produces 100% more electricity than panel C.

Likewise, a 20% panel produces approximately 5% more electricity than a 19% panel. Confusing, right? Take a second a think through it all if you need to.

Okay, ready to go? Now that we’re all happy with efficiency, we can talk about why it should be low down on the list of your priorities.

The real question to ask yourself

Instead of obsessing about buying the highest efficiency panels, you should be more concerned with the solar option that produces the most watts for your dollar. In other words:

“What’s the most solar power production I can get for my money?”

Imagine you’re getting a 5kW solar system installed. System A uses 19% efficient panels for a grand cost of $15,000. System B, uses 20% efficient panels for a grand total of $20,000.

Now, both systems are 5kW; they produce the same amount of power. Note that the system with 20% panels can produce more electricity per panel, so the less efficient system will need more panels to achieve the same power production. Which system do you go for? A or B?

Let’s calculate the power you’re getting for your money.

System A: 5kw/$15,000 = $3 per watt

System B: 5kW/$20,000 = $4 per watt

Thus, you’re getting cheaper energy with system A than with system B. Provided both systems can fit on your roof, you’d be mad not to pick A.

But there’s the kicker: “Provided both systems can fit on my roof.” Well, can they?

Solar pundits these days rehash the same phrases. “If you’ve got limited space, you may want higher efficiency panels.” That’s not really a very helpful solution. It’s just too vague!

Let me be clear: IF you live in an average house, with half of your roof available for solar panels, and no giant tree in the way, going for the lowest $/watt is the way to go. If you get that with a lower efficiency panel, so be it. If a company makes it happen with a higher efficiency panel, great. The point is, for you and every other homeowner, efficiency doesn’t matter. Dollar per watt does.

Now let me prove it:

A 5kW system produces 5000W. It doesn’t matter if it’s from 10,000 panels that are 1% efficient or just 100 panels that are 100% efficient. A 5kW system produces 5kW.

A quick example to really drive the point home: Let’s say Power Plant A is 1MW and uses 1% efficient panels. Power Plant B is 1MW, and uses 20% efficient panels. Which produces the most power?

Answer: The same amount! They’re both 1MW! They produce the exact same amount of power. But Plant B’s panels are 20x better than Plant A’s, so it will need twenty times less panels to produce the same amount of electricity. Thus, Plant A will be giant, while Plant B will be modest in size. Savvy?

So again, low efficiency isn’t a problem, provided your roof has enough space. Think $/watt.

So does my roof have enough space?efficient solar panels

Short answer, yes.

Long answer, yes, and I’ll explain why:

Let’s say you wanted to generate 100% of your electricity needs from solar panels. Let’s assume you’re an average consumer:

Question: Do you have enough roof space to take solar panel efficiency out of the equation?

Well, a 2400 square foot house, assuming dimensions of 60 feet x 40 feet, will give flat roof area of 2,400 square feet. Put a medium pitch into the equation (6/12; 26.6-degree angle), this gives each side of the roof dimensions 22.4′ x 60′, or 1,344 square foot. The total roof area is twice that, but not all of it will face the sun. For simplicity, let’s assume half the roof is south facing. Now, fire regulations want 3 feet of space between panels and the edge of the roof. Although some solar installers get around it, we’ll assume they comply.

This makes the effective roof dimensions 16.4 x 54, giving you 885 square feet to play with. Is this enough to generate 100% of your 30kWh/day electricity needs? To find out, we have to switch to square meters:

16.4 ft x 54 ft = 5m x 16.5m, meaning your average roof has roughly 82 solar-worthy square meters.

For every hour of peak sunlight, you get 1kW/square meter, thus you’ve got 82kWh of solar energy hitting your roof every hour, or around 400kWh every day. You need 30kWh/day. So far so good.

Now, panels only convert 15-20% of that into electricity. If you go with the lowest efficiency on the market – around 15% for ultra-common polycrystalline silicon solar panels – you’d capture 60kWh a day. But taking into account DC to AC losses (0.77 derate factor), you’d be left with 46.2kWh. In other words, PLENTY of electricity.

If you went with top of the range panels, you’d be generating so much energy you wouldn’t know what to do with it all.

So, if you have an average roof, space ISN’T an issue.

And therefore, it makes NO SENSE to choose a panel based on efficiency. Purely think in terms of $/watt. You have enough space. If you’re worried you don’t have an average roof, go measure it, then come up with a back-of-the-envelope calculation.

Other questions to ask yourself

Beyond $/watt, there are a few other questions to ask about your solar panels: Is the performance guaranteed? If so, for how long? A high-efficiency panel is fine, but not if its efficiency plummets 5 years down the line.

Also, how durable are the panels? Are they made of glass (weak), or tempered glass (strong)? What’s their temperature range?

And above all, choosing a decent solar installer should take priority over panels. Good customer service, with performance guarantees, proper financing… these all have a huge impact on your solar journey.

And that said, at the end of the day, you probably won’t have much of a choice. You’ll be limited by the suppliers that the installer uses. Sure, you could go to SunPower just to get their hot-shot high-efficiency panels, but if you go with other installers, like SolarCity, you’ll have to pick from the panels they have.

“But surely, there must be some cases where efficiency trumps all?”

If you’re a NASA spaceship designer, with a vast amount of capital at your disposal, and charged with providing enough power for astronauts to survive in a lethal environment for years, then cost probably takes a back seat to performance. You’ll want to squeeze every ounce of efficiency out of those bad boys.

Or, if your roof truly is the size of a postage stamp.

But let’s be honest. Nine times out of ten, roof space just isn’t an issue and you can simply choose whichever panels give you the best $/watt. Usually, the winning panels in these scenarios are the ubiquitous polycrystalline silicon panels, but hey, the solar landscape is always changing. We could wake up one day to a world plastered in Perovskites.

Talking about Perovskites…, did you see they’ve reached 22.3% efficiency!

Man, I’ve GOT to get one of those.

Image Credits under CC License from Pixabay: 1, 2

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