*Mid Year Update – June 2025*

The costs of solar and battery storage is always a hot topic. Prices have dropped significantly over the past decade, but in recent years, they’ve stabilized. Will they stay that way? Will they drop further? The answer isn’t simple, but we’ll break it down as clearly as possible!

The Big Picture: Solar Costs Over Time

Solar panel prices have dropped significantly over time. In 2010, the national average installed cost for residential solar was around $7.50/watt. Today, in 2025, it’s about $3/watt before tax credits or incentives—thanks to economies of scale and improvements in silicon PV manufacturing.

Battery storage costs have also plummeted in the last 10 years. In 2010, batteries cost $1000-$1500/kWh. Today, advanced chemistries like LFP (Lithium Ferrophosphate) and LiFePO4 (Lithium Iron Phosphate) have brought that down to $200-$400/kWh—a 75% drop over 15 years.

Ongoing advancements in materials science and R&D promise even more cost reductions. New technologies entering the market in late 2025 and beyond will be easier to manufacture, using more abundant raw materials.

What’s Driving Costs Up in 2024 & Beyond?

Despite past price drops, recent years have seen price fluctuations. Several market forces are at play, sometimes driving costs up. Here’s why:

• Global supply chain issues have created uncertainty, slowing demand and increasing costs.
• Macroeconomic factors like inflation and trade policies (tariffs) (whether real or imagined)  have made components more expensive.
• Construction materials and labor costs have increased, raising system installation prices.
• Utilities have reduced compensation for excess solar energy fed back into the grid, extending the return-on-investment (ROI) period for homeowners.

What’s Keeping Prices Down?

While some forces push prices up, others help keep them down:

• Economies of scale continue to lower costs as adoption increases.
• Innovations in materials science are leading to cheaper, more efficient solar panels and batteries.
• Manufacturing and logistics improvements have streamlined production, reducing costs.
• Increased competition among vendors is driving prices lower.
• Federal, state, and local incentives help offset costs—though future policy changes could impact this.
• Texas Legislature Killed Anti-Renewable Bills that would have increase costs

Will Solar Prices Rise or Fall?

Nobody has a crystal ball, but experts predict solar and battery prices will remain relatively stable in 2025, with fluctuations of around 5-10%. However, potential trade disputes and new tariffs could shift this outlook. Also, obviously, the the pending Big Beautiful Bill legislation -if passed as-is in the U.S. Senate- threatens to kill federal income tax credits and other extremely popular tax incintives. It’s not clear how this may effect the solar industry but we’re starting to see demand go up.

As next-gen technologies like solid-state batteries and perovskite solar panels enter the market, existing technologies may see price drops. These new solutions use more abundant materials and are expected to be cheaper to manufacture at scale.

It’s impossible to say where we’ll be event a quarter from now, but as of mid-June ’25, with all factors counted in, NATiVE Solar’s pricing is right around where it was at the end of last year. While some of our costs and risks are slighty elevated, we’ve decided to absorb those extra costs instead of pass them through to our customers.

What’s the Best Move?

Here’s the bottom line:

Even with market uncertainty, investing in solar and batteries is still a smart decision. Here’s why:

• Electricity prices are projected to rise in the coming years.
• Texas grid instability remains a major issue, making battery storage a valuable backup.
• With solar and battery storage, you’re locking in decades of energy savings—most systems last 25+ years.
• Switching to renewable energy is a meaningful step toward reducing your environmental footprint.

Got Questions?

NATiVE Solar is here to help! Whether you’re considering solar panels, battery storage, or just exploring options, our team can guide you. Let’s power up Texas together!