Growing scandal at the heart of the solar power industry

Solar Panel Degradation

By —— Bio and Archives--January 31, 2014

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Everyone has heard the pitch for solar energy, install solar cells on your roof and get free electricity from the sun. Sure they cost a lot up front, but they will last 25-30 years—which just happens to be about the payback time given current electricity rates from coal, nuclear and natural gas. So when the solar panels start failing in two or three years the economics of solar power collapses like a house of cards. That is exactly what is happening around the world. Cheap Chinese solar panels have flooded the market and are now starting to fail at an alarming rate. Solar panels covering a warehouse roof in Los Angeles were only two years into their expected 25-year life span when they began to fail. Worldwide, solar power adopters are reporting similar problems and the $77 billion solar industry is facing a quality crisis reports Doug Hoffman. (1)


In May 2013 The New York Times exposed this growing scandal at the heart of the solar power industry. No one is sure how pervasive the problem is since there are no industry wide figures about defective solar panels. And when the defects are discovered, confidentiality agreements often keep the manufacturer’s identity secret, making accountability in the industry all the more difficult. (2)

Most of the concerns over quality center on China, home to the majority of the world’s solar panel manufacturing capacity. Inspections of Chinese factories on behalf of developers and financiers revealed that even the most reputable companies are substituting cheaper, untested materials. Others are outsourcing production to smaller, less reputable companies. SolarBuyer, a company based in Marlborough, Mass., discovered defect rates of 5.5% to 22% during audits of 50 Chinese factories over the last 18 months notes, Todd Woody.(2)

In order to accelerate production and become the world’s leading solar panel manufacturing area, the Chinese incurred billions of dollars in debt. Now, these solar manufacturing companies are under pressure to cut costs and are substituting less expensive materials that are untested or whose use-by date have expired or subcontracting to smaller manufacturers where there is no quality control. In effect, the price war that Chinese manufacturers waged was a suicide mission. Now even they’re going bankrupt, including their erstwhile number one, Wuxi Suntech, when the banks pulled the ripcord in March 2013. (3)

Defective Chinese panels wouldn’t be a big issue if there were plentiful domestically-produced alternatives. Unfortunately, thanks to our unfair trading relationship with China, American manufacturers haven’t been able to stay in business. China has heavily subsidized their green energy companies, offering such perks as free land, interest-free loans and export subsidies to ensure that their companies have all the advantages they need to conquer the rest of the market. Chinese solar companies have dumped their products on the US market at below market rates, putting their American competitors out of business. (4)

That said, it is not just Chinese solar arrays that are failing—the defective panels installed on the Los Angeles area warehouse were made by an American manufacturer. Furthermore, all solar panels degrade and gradually generate less electricity over time.

The German solar monitoring firm, Meteocontrol, found that 80 percent of the 30,00 solar installations it reviewed in Europe were underperforming. Enertis Solar tested solar panels from 6 manufacturers at two power plants in Spain and found rates of malfunctioning as high as 34.5 percent. An inspection of a solar plant in Britain found that 12 percent of its Chinese modules failed. In the United States, an American solar manufacturer, First Solar, budgeted $271.2 million to replace defective modules it manufactured in 2008 and 2009. (5)

Google was eager to learn about how its system performed. A review six months after installation revealed it was only getting about half of the power it expected. (1)

A history of degradation rates using field tests reported in the literature during the last 40 years has been summarized by Jordan and Kurtz. Nearly 2000 degradation rates, measured on individual modules or entire systems, were assembled from the literature and showed a mean degradation rate of 0.8% per year and a median value of 0.5% per year. The majority, 78% of all data observed, showed a degradation rate of

< 1% per year. Thin-film degradation rates improved significantly during the last decade, although they are statistically closer to 1% per year than to the 0.5 % per year necessary to meet the 25 year commercial warranties. (6)

On the plus side, not all solar manufacturers are having problems. For example, the US subsidiary of the Chinese solar manufacturing firm Yingli, is supplying solar panels for a power plant in California, touting that the company does not cut corners and its statistics seem to prove it. Since 2009, 2. 8 million modules had been shipped to the United States with only 15 modules being returned as defective. With the demise of Suntech, Yingli is now the world's largest solar panel manufacturer. (5)

Yet all these facts taken together give lie to the claim that solar power is mature and competitive. If 25 years are needed to break even, cells that fail in 2.5 years, or even cells that degrade faster than planned, mean solar will never be economically viable. Add the industry secrecy surrounding the low quality of their product and as Doug Hoffman says, “This goes from being a lie to being a scam.” (1)

Jack Dini
Livermore, CA


  1. Doug L. Hoffman, “Solar power failing world wide,” The Resilient Earth, June 9, 2013
  2. Todd Woody, “Solar industry anxious over defective panels,” The New York Times, May 28, 2013
  3. Wolf Richter, “Solar crisis: cheap Chinese solar panels prove defective,” oilprice.com, May 30, 2013
  4. John Olen, “Defective Chinese solar panels are derailing green energy efforts,” economyincrisis.org, January 17, 2014
  5. “America’s green energy problems: defective solar panels,” Institute for Energy Research, June 3, 2013
  6. Dirk C. Jordan and Sarah R. Kurtz, “Photovoltaic degradation rates- an analytical review,” National Renewable Energy Laboratory, NREL/JA-5200-51664, June 2012


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Jack Dini -- Bio and Archives | Comments

Jack Dini is author of Challenging Environmental Mythology.  He has also written for American Council on Science and Health, Environment & Climate News, and Hawaii Reporter.

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