Degradation Rate
Solar panel degradation rate is the annual percentage decrease in a panel's power output due to aging and environmental exposure. All solar panels gradually lose output over time as the semiconductor materials, encapsulants, and cell connections degrade from UV exposure, thermal cycling, moisture ingress, and other stresses.
Understanding degradation is critical for long-term energy production forecasting and financial modeling of solar projects.
Typical Degradation Rates
- Modern monocrystalline (PERC, TOPCon): 0.40–0.55%/year
- Standard monocrystalline: 0.50–0.70%/year
- Polycrystalline: 0.60–0.80%/year
- Thin-film (CdTe): 0.40–0.60%/year
First-year degradation ("light-induced degradation" or LID) is often higher than subsequent years, typically 1–2% for standard silicon panels. TOPCon and HJT panels have significantly reduced LID.
Degradation Over System Life
Most manufacturers warrant panels to produce at least 80–90% of rated output after 25 years. Using a typical 0.50%/year rate:
Year 1: 100% → Year 10: 95.5% → Year 25: 88.3%
The actual production loss over 25 years is less than the simple percentage suggests because the loss compounds slowly. A system producing 10,000 kWh in year 1 produces approximately 8,830 kWh in year 25 at 0.50%/year degradation.
Modeling Degradation in SolarScope
SolarScope provides year-1 production estimates. For multi-year financial models, apply the degradation rate annually to project lifetime energy production. The AI Assistant can help build a 25-year production model with degradation applied.