Dive Brief:

• Solar financing and other non-hardware, or "soft costs," make up 64% of the overall costs of residential photovoltaic (PV) solar systems, according to two reports from the National Renewable Energy Laboratory (NREL). Similar results were found for commercial installations.
• Supply chain costs, installation labor, customer acquisition and indirect corporate costs, like maintaining office management and accounting functions, were the largest soft costs for residential systems.
• NREL found that third-party ownership added 78 cents/W for residential systems and 67/W for commercial projects.

Dive Insight:

Solar "hard costs" have fallen rapidly in the last few years so it is not surprising that soft costs are becoming a large share of total solar costs. Developers like First Solar have been working at driving down soft costs as well. The NREL report notes that "soft costs are both a major challenge and a major opportunity for reducing PV system prices" and stimulating increased PV deployment in the U.S.