Cost Per Watt is a Terrible Metric - PVBid
Apr 27
Cost Per Watt (CPW)

Cost Per Watt is a Terrible Metric

Awhile back I started talking about a solar system cost.  Immediately, the person with whom I was speaking translated number into a cost per watt.  I totally understand why folks do that. It gives you a quick and dirty way to compare between systems.  But it is SO dirty.  And misleading.  It’s misleading because it doesn’t really tell you anything about the system.  There are so many parameters needed to make sense of the cost per watt.

Racking is my favorite example of how this can go horribly wrong.  When doing a solar estimate, you need to include the cost of the racking.  People love to say things like “35 cents a watt”.  Every racking salesperson who has pitched to me throws out a cost per watt. Some of the more savvy ones are cautious about it which always wins my favor.  In this case, it depends ENTIRELY on which module I’m using.  A SunPower 345 watt module is about 17.5 square feet.  A Trina 250 watt module is about 17.6 square feet.  So racking for a SunPower 345 would be about $120 per module while the Trina 250 only costs $87.  How does that make sense?  

And how do you model that?!  They require the same amount of racking, so they should cost the same.  After all, the modules are almost identical.  One is 39.95 inches wide while the other is 41.02 inches wide.  There is some difference but a little more than one inch is does not make for a $33 difference.  If it does, that is one expensive inch!

As you can imagine, I prefer to keep my racking costs logged by the square foot.  Tracking solar bid costs through more indicative values can lead to more accurate insight into your costs.  Which also can lend to faster numbers because you aren’t muddled by numbers that don’t add up in a useful way.

Finally wrapping up with a shameless plug: PVBid is designed to analyze your solar bidding data for the most useful metric.  How cool is that?!

Also, I want to hear from you!  How do you feel about my blog articles?  What’s your opinion on cost-per-watt?  Do you have a topic you want me to discuss?  Leave a note here or send me an email at connor@pvbid.com.

About The Author

With over a decade of experience, Connor English has watched and experienced the solar industry change and shift in dramatic ways. He has worked on PV systems from the ground up - selling, designing, building, engineering, and costing. With exposure to 100+ different company estimating methodologies, Connor has become a recognized expert in solar estimating.

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