Solar Panel Degradation: The Data Behind the 25-Year Warranty
Quality panels degrade ~0.5%/year — but some hit 1%. Here is the degradation data, how it affects your 25-year savings, and what to check before buying.
By The PVFig Editorial Team · 2026-08-10 · reviewed against EIA, NREL and DSIRE sources
The numbers
Premium panels degrade ~0.5%/year (REC, Maxeon guarantee 0.25–0.5%); budget panels ~0.6–1%. At 0.5%/year, a panel produces ~88% of original output at year 25; at 1%, only ~78%. That 10-point gap is real money over the system life.
What the warranty guarantees
Performance warranties typically guarantee 90% output at year 10 and 80–85% at year 25. Degradation is not linear in practice — panels lose a bit faster in year one, then stabilize. Read the exact schedule, not just the headline.
Why it matters for payback
Your 25-year savings projection assumes a degradation rate. If your panel degrades 1%/yr instead of 0.5%, lifetime output drops ~10% — worth hundreds to thousands of dollars. When comparing quotes, normalize for degradation, not just $/W.
FAQ
How much do solar panels degrade per year?
Premium panels ~0.5%/year; budget panels up to 1%. At year 25 that is roughly 88% vs 78% of original output.
What is a good solar degradation rate?
0.5%/year or less is excellent (REC, Maxeon). Above 0.8% should be a red flag for residential panels.
Does degradation affect my solar savings?
Yes — 1%/yr vs 0.5%/yr costs ~10% of lifetime output. Normalize for it when comparing quotes.
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Sources
- U.S. EIA — electricity rates by state, eia.gov/electricity/monthly
- NREL PVWatts v8 — solar production by location, pvwatts.nrel.gov
- DSIRE — state incentives and net metering, dsireusa.org
- See how every figure on this page is calculated — PVFig methodology.
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