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Exploring the impact of permitting and local regulatory processes on residential solar prices in the United States

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  • Burkhardt, Jesse
  • Wiser, Ryan
  • Darghouth, Naïm
  • Dong, C.G.
  • Huneycutt, Joshua

Abstract

This article statistically isolates the impacts of city-level permitting and other local regulatory processes on residential PV prices in the United States. We combine data from two “scoring” mechanisms that independently capture local regulatory process efficiency with the largest dataset of installed PV prices in the United States. We find that variations in local permitting procedures can lead to differences in average residential PV prices of approximately $0.18/W between the jurisdictions with the least-favorable and most-favorable permitting procedures. Between jurisdictions with scores across the middle 90% of the range (i.e., 5th percentile to 95th percentile), the difference is $0.14/W, equivalent to a $700 (2.2%) difference in system costs for a typical 5-kW residential PV installation. When considering variations not only in permitting practices, but also in other local regulatory procedures, price differences grow to $0.64–$0.93/W between the least-favorable and most-favorable jurisdictions. Between jurisdictions with scores across the middle 90% of the range, the difference is equivalent to a price impact of at least $2500 (8%) for a typical 5-kW residential PV installation. These results highlight the magnitude of cost reduction that might be expected from streamlining local regulatory regimes.

Suggested Citation

  • Burkhardt, Jesse & Wiser, Ryan & Darghouth, Naïm & Dong, C.G. & Huneycutt, Joshua, 2015. "Exploring the impact of permitting and local regulatory processes on residential solar prices in the United States," Energy Policy, Elsevier, vol. 78(C), pages 102-112.
    • Handle: RePEc:eee:enepol:v:78:y:2015:i:c:p:102-112
    DOI: 10.1016/j.enpol.2014.12.020
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    Cited by:

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    6. Strupeit, Lars, 2017. "An innovation system perspective on the drivers of soft cost reduction for photovoltaic deployment: The case of Germany," Renewable and Sustainable Energy Reviews, Elsevier, vol. 77(C), pages 273-286.
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    8. Neij, Lena & Nemet, Gregory, 2022. "Accelerating the low-carbon transition will require policy to enhance local learning," Energy Policy, Elsevier, vol. 167(C).
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    10. Strupeit, Lars & Neij, Lena, 2017. "Cost dynamics in the deployment of photovoltaics: Insights from the German market for building-sited systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 948-960.
    11. Nemet, Gregory F. & O'Shaughnessy, Eric & Wiser, Ryan & Darghouth, Naïm R. & Barbose, Galen & Gillingham, Ken & Rai, Varun, 2017. "What factors affect the prices of low-priced U.S. solar PV systems?," Renewable Energy, Elsevier, vol. 114(PB), pages 1333-1339.
    12. Ehlers, Melf-Hinrich & Sutherland, Lee-Ann, 2016. "Patterns of attention to renewable energy in the British farming press from 1980 to 2013," Renewable and Sustainable Energy Reviews, Elsevier, vol. 54(C), pages 959-973.
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    14. O'Shaughnessy, Eric & Nemet, Gregory F. & Pless, Jacquelyn & Margolis, Robert, 2019. "Addressing the soft cost challenge in U.S. small-scale solar PV system pricing," Energy Policy, Elsevier, vol. 134(C).
    15. Liu, Zhengguang & Guo, Zhiling & Chen, Qi & Song, Chenchen & Shang, Wenlong & Yuan, Meng & Zhang, Haoran, 2023. "A review of data-driven smart building-integrated photovoltaic systems: Challenges and objectives," Energy, Elsevier, vol. 263(PE).
    16. O'Shaughnessy, Eric & Dong, Shiyuan & Cook, Jeffrey J. & Cruce, Jesse & Ardani, Kristen & Fekete, Emily & Margolis, Robert, 2022. "Effects of local permitting and interconnection requirements on solar PV installation durations," Energy Policy, Elsevier, vol. 161(C).
    17. O'Shaughnessy, Eric & Barbose, Galen & Wiser, Ryan, 2020. "Patience is a virtue: A data-driven analysis of rooftop solar PV permitting timelines in the United States," Energy Policy, Elsevier, vol. 144(C).
    18. Wiggins, Seth, 2016. "It’s All Local? How Sub-State Policies Affect Western US Residential Solar Adoption," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235667, Agricultural and Applied Economics Association.
    19. Barbrook-Johnson, Peter & Tankwa, Brendon, 2023. "Increasing inequality between countries in key renewable energy costs," INET Oxford Working Papers 2023-20, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford.

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