The costs of solar power
The development and licensing of a solar power project and the acquisition of land already require some capital, but the main costs of such a project are related to the purchase of materials and construction. In addition to the price of solar panels and inverters, the installation environment has a significant impact on the cost of the project. The surroundings and the terrain will determine how the panels are installed and the number of labour hours required.
Grid connection is also an important cost factor for a power plant: the voltage, distance and implementation method of the grid connection directly affect the cost. Hybrid projects – i.e. combining solar and wind power with possible energy storage – can also offer synergies on the financial side. Hybrid projects make use of common infrastructure, which can lead to savings in overall costs.
Once the construction phase is completed, the cost of solar power generation is moderate, as solar radiation is a free energy source that does not need to be transported to the power plant, and the panels have a relatively long lifespan. In addition to any land rental, production costs include technical inspections and maintenance as well as site maintenance costs.