Solar

Panel Degradation Rate The yearly decline in a solar panel's power output as it ages

Alex Rivera By Alex Rivera, Senior Solar Editor · Updated 2026-06-09
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Panel degradation rate is the gradual annual decline in a solar panel's electricity output as it ages. For quality panels, this is commonly around 0.5% per year, meaning a panel may still produce roughly 85-90% of its original output after 25 years. Degradation happens because exposure to heat, sunlight, and weather slowly wears down the panel's materials over time. The lower the degradation rate, the more energy your system generates across its lifespan, which matters for your long-term savings projections. This decline is usually covered by a performance warranty from the manufacturer, which guarantees a minimum output percentage at certain milestones. Actual rates vary by panel brand, build quality, and climate, so it's worth comparing the stated degradation rate and warranty terms before you buy.
Also Known As
Solar degradation rate Annual power loss Panel output decline Performance degradation
Used in Context
  1. When comparing two installer quotes, you noticed one panel had a 0.5% degradation rate while the other listed a higher annual loss.
  2. A Dreamy Leads solar shopper asked how much energy their panels would still produce after 25 years given the manufacturer's degradation rate.
  3. Your savings estimate factored in the panel degradation rate so the projected output dropped slightly each year over the system's life.
Related Terms
Solar Solar Panel Efficiency How much sunlight a solar panel turns into usable electricity Solar Monocrystalline Solar Panels High-efficiency solar panels made from single-crystal silicon with a uniform black look Solar Photovoltaic (PV) System A solar electric setup that turns sunlight into usable electricity Solar Kilowatt-Hour (kWh) The unit of energy used for electricity billing—one kilowatt of power used for one hour Solar Solar Payback Period How long it takes for energy-bill savings to cover what you paid for solar after incentives
Frequently Asked Questions

What is a good solar panel degradation rate?

A degradation rate around 0.5% per year is common for quality panels and considered solid. At that pace, your panels may still produce roughly 85-90% of their original output after 25 years. Lower rates mean more energy and savings over the system's lifespan, so compare this figure across brands.

Does degradation mean my panels will stop working?

No. Degradation is a gradual decline in output, not a sudden failure. With a typical 0.5% yearly rate, panels still generate about 85-90% of their original output after 25 years. They keep producing power for many years; they just produce slightly less as they age.

Is panel degradation covered by warranty?

Usually, yes. Degradation is typically covered by a performance warranty from the manufacturer, which guarantees a minimum output percentage at set milestones. Terms vary by brand, so review the specific warranty language to confirm the guaranteed output levels and how long the coverage lasts.

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