Solar panel prices have fallen dramatically over the past two decades, but the pace of further declines is slowing as the technology matures. Panel hardware costs will likely continue falling gradually, but total installed system cost is increasingly shaped by labor, permitting, and financing rather than panel price alone.
The Historical Cost Decline
Solar module prices have dropped roughly 90% over the past 15 years, driven by manufacturing scale, technology improvements (PERC, TOPCon, HJT), and global supply chain expansion, particularly in China’s dominant manufacturing base.
Why the Pace Is Slowing
| Cost Component | 2026 Trend |
|---|---|
| Panel/module hardware | Continuing to fall gradually, but near a manufacturing cost floor |
| Labor | Rising with wage inflation, now a larger share of total cost |
| Permitting/soft costs | Largely flat to rising, varies by jurisdiction |
| Inverters/batteries | Still declining as manufacturing scales further |
Manufacturing Cost Floor
As panel manufacturing has scaled globally, raw material and production costs are approaching a practical floor — further declines in hardware cost are likely to be gradual rather than the dramatic drops seen in the 2010s and early 2020s.
Soft Costs Now Dominate
Panels themselves now represent only about 15-22% of total installed system cost — labor, permitting, sales/marketing, and financing (collectively “soft costs”) make up the majority, and these are far less likely to decline as quickly as hardware has historically.
Tariffs and Trade Policy Impact
Trade policy, tariffs on imported panels, and domestic manufacturing incentives can push installed costs in either direction independent of underlying manufacturing efficiency gains — an important variable that makes long-term price forecasting more uncertain than pure technology trends alone would suggest.
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Frequently Asked Questions
Will solar panels get cheaper in the future?
Panel hardware will likely continue falling gradually, but total installed cost is increasingly shaped by labor and soft costs.
How much have solar prices dropped historically?
Module prices have fallen roughly 90% over the past 15 years.
Why is the pace of price decline slowing?
Manufacturing has scaled to near a practical cost floor, so further hardware declines are likely gradual.
What percentage of solar cost is the panels themselves?
Only about 15-22% of total installed system cost — the rest is labor, permitting, and financing.
Do tariffs affect solar panel prices?
Yes — trade policy and tariffs can push installed costs in either direction independent of manufacturing trends.
Should I wait for prices to drop further before going solar?
Since hardware declines are now gradual, waiting offers limited additional savings while delaying accumulated bill savings.
Are batteries getting cheaper too?
Yes — battery costs are still declining as manufacturing scales further, similar to earlier panel trends.
Summing Up
Solar remains a sound investment even as the pace of price declines slows. To lock in current pricing for your home, call (855) 427-0058 or visit us.solarpanelsnetwork.com.
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