WREF 2012: Benchmarking Non-Hardware Balance of System Costs for PV Systems in the United States using a Bottom-Up Approach

This paper presents results from the first U.S. based data collection effort to quantify non-hardware, business process costs for PV systems at the residential and commercial scales, using a bottom-up approach. Annual expenditure and labor hour productivity data are analyzed to benchmark business process costs in the specific areas of: (1) customer acquisition; (2) permitting, inspection, and interconnection; (3) labor costs of third party financing; and (4) installation labor. Annual cost and labor hour data were collected from 87 installers. After eliminating outliers, the survey sample consists of 75 installers, representing approximately 13% and 4% of 2010 added PV installations at the residential and commercial scales, respectively. Results indicate that business process costs benchmarked in this analysis (including assumed permitting fees) total $1.52/W for residential systems (ranging from $0.66/W to $1.66/W between the 20^th and 80 ^th percentiles). For commercial systems, the survey results suggest business process costs of $0.99/W for systems <250kW (ranging from $0.51/W to $1.45/W between the 20^th and 80^th percentiles), and $0.25/W for systems >250kW (ranging from $0.17/W to $0.78/W between the 20^th and 80^th percentiles). We conclude that business process costs present significant opportunities for efficiency gains and cost reductions.