How much does a solar panel actually produce?

Wednesday, June 30, 2021

The age old question  

One of the most commonly asked questions is how much energy can a solar panel produce over its lifetime?

To attempt to answer this question we must familiarize ourselves with some basic concepts such as:

  • Power versus energy
  • STC - Standard Test Conditions
  • Solar panel efficiency
  • Lifespan of the solar panel
  • The solar panel degradation over its lifespan

Power versus energy  

We have 5 kW (5000 watt) solar array. Its peak power output is 5000 watts but due to various factors this peak is rarely reached. This array, installed in Melbourne, Victoria, Australia, will produce on average, 18 kWh/day of energy, more in summer less in winter so:

  • Power is instantaneous output based on the capacity of the array
  • The max power output occurs at solar noon, with an Equator facing array, on a bright sunny day
  • Energy is power x time
  • Expressed in kWh and is related to daytime length, light intensity and other factors

Standard Test conditions  

STC stands for “Standard Test Conditions” and is the industry standard for the conditions under which a solar panel is tested. By using a fixed set of conditions, all solar panels can be more accurately compared and rated against each other. 

There are three standard test conditions which are:

  • Temperature of the cell – 25°C.
  • The temperature of the solar cell itself
  • Solar Irradiance – 1000 Watts per square meter, amount of light energy on a given area 
  • Mass of the air – 1.5. amount of light that has to pass through Earth’s atmosphere 

What is solar panel efficiency?  

This is the measure of the amount of solar energy which falls on a panel surface converted into electricity and average panel conversion efficiency has increased from 15% to 20% in the last few years and has resulted in the power output of a standard size panel to increase from 250W up to 340W:

  • It is related to STC’s
  • If a panel has a total surface area of 2 m2 and is rated at 400 watts, it has an efficiency of 20%
  • Area of panel is determined and is divided into its watt rating, 400/2000mm= 20%

Lifetime and degradation of a solar panel

As there are no moving parts solar panels are designed to last for many years but like all things they degrade. This degradation takes the form of a decrease in production, year after year. Nowadays most reputable manufacturers offer a minimum 25 years production guarantee:

  • Usually around 2% reduction in output after the first year
  • Then anywhere from 0.25% to 0.7% every year after that up until 25 year point
  • After that degradation continues

We are all set to go with some assumptions

These assumptions include:

  • For every one kW of solar installed, will produce on average 3.6 kWh/day
  • After first year all the panels degrade at between 2% - 3%
  • From year 2 - 25 degradation will vary depending on the panel
  • Calculations will be made on a range of system sizes

The results

Results explained

Looking at the 1 MW system, the best output from panel 1 @ 31,347 MWh and the worst is panel 10 @ 29,563 MWH. This is a difference of 1,904 MWh or 1,904,000 kWh over 25 years.

So how much is this worth? The answer depends on the average value of each kWh produced over the 25 year period.

Based on a 5 kW system over 25 years.


The location, the dollar value attached to a kWh of energy, the tilt angle and direction of the array all play an important role in the final output of the system in addition to the panels degradation specifications.

Other factors include the panels temperature coefficient, i.e. all panels are temperature sensitive in regards to output and some are better than others.


✅ Solar panels have become more efficient in the last few years, > 20%

✅ How much a solar produces over its lifetime depends on many factors

✅ On large systems, a solar panel degradation rate can translate into large dollar differences

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