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Do Solar Panels Lose Performance Over Time?

Solar panels are among the most durable power generation systems, and those from high quality brands last for over 25 years. However, some degradation and loss of performance can be expected over time, like with any device. Having no moving parts contributes to the long service life of solar panels, since there is no mechanical wear.

Installing a solar array may seem expensive, but operation and maintenance costs are very low after the initial investment. With favorable site conditions and a professional installation, each dollar invested in a solar power system is recovered multiple times during its service life.

Large solar arrays also save thousands of tons of carbon dioxide during their service life. This is especially true in countries where the power grid still uses large amounts of coal generation, such as Australia.

The Importance of Quality When Purchasing Solar Panels

All solar panels lose generation capacity over time. However, the top brands specify a loss limit per year, and a warranty that covers you if performance drops faster. Using low quality solar panels is not recommended, for several reasons:

  • There is a higher risk of short circuits or other electrical faults.
  • They may lose performance very fast, or they may fail completely without any warranty coverage.
  • Your solar array will not be eligible for the incentive programs in Australia, negating any savings from purchasing cheap products.

The exact warranty conditions vary depending on the manufacturer, but in most cases you can expect a 10-12 year warranty against factory defects, and a 25-year warranty against loss of generation capacity. Generally, manufacturers will guarantee at least 80% of the initial generation capacity after a 25-year period.

Getting solid warranties for your solar equipment is an excellent financial decision. Solar power systems in Australia normally have a payback period below 5 years, and in many cases below 3 years. When the system is covered by warranties that exceed the payback period, and the manufacturer can be trusted, the return on investment is guaranteed.

Keep in mind that warranties may be voided due to an unprofessional installation or lack of maintenance. Having your solar array installed and serviced by a qualified provider is strongly recommended. Signing a Power Purchase Agreement can be a good option, since the provider assumes responsibility for financing, operation and maintenance.

How Does a Linear Performance Warranty Work?

As mentioned above, quality solar panels come with a 25-year warranty that specifies a minimum performance of 80% at the end of its term. However, a solar panel that loses plenty of production capacity during the first years will produce less electricity over time. On the other hand, a solar panel that degrades at a slow pace will deliver more energy, even if both reach 80% performance after 25 years.

Solar panels with a linear performance warranty have a constant loss per year, which means their power output drops at a linear rate. For example, you may find a solar panel model with the following specifications:

  • Maximum performance loss of 3% in the first year of operation.
  • Linear performance loss of 0.7% per year, until reaching 25 years.

These solar panels will have 97% of their initial output after the first year, 90.7% performance after 10 years, and 80.2% performance after 25 years. On the other hand, a solar panel that drops to 85% performance in 10 years will produce much less energy over time, even if the output is still 80% after 25 years.

In this case, if you find 20 panels that only produce 88% of their initial output after 10 years, the 25-year linear performance warranty will apply and you will get replacements. On the other hand, a warranty that only offers 80% performance after 25 years will not apply, since the panels have not dropped to 80% output yet.

Even the best solar panels lose performance over time, but this should not occur at an accelerated pace. A linear performance warranty increases your return on investment: your savings increase thanks to the extra production over time.


Power generation equipment has a finite service life, and this includes solar panels. However, the generation loss per year should be reasonable, and you can protect your investment by getting good warranties. The simplest solution is working with a solar company that uses equipment from top brands, such as Solar Bay, part of Energy Bay.