When homeowners are considering solar offers on the EnergySage Solar Marketplace, we often hear questions about a solar panel’s manufacturer origin and whether it’s a good idea to choose Chinese panels for an installation. This is a common question as the latest estimates indicate that China is manufacturing roughly 70% of the world’s solar panels today – a dominant market share and a clear indicator of China’s key role in the global solar industry. China has a significant impact over worldwide solar trends like pricing, warranties and manufacturing practices. For example, the 80% decline in worldwide solar prices between 2008 and 2013 occurred largely due to improvements in manufacturing costs in China. And because China is such a major player in solar, many U.S. homeowners are asking “should I choose Chinese solar panels and will it match the quality of other top brands?” In this article we’ll break down pricing, quality and brand influence of Chinese solar panels.
Chinese solar companies vs. Chinese solar manufacturing
Before explaining how Chinese solar panels compare to those made in other nations, it’s important to clarify what “Chinese solar panels” refers to. As explained above, approximately 70% of all solar panel equipment is produced in China. But that doesn’t mean that 70% of all solar manufacturers are Chinese companies, just that the majority of companies around the globe outsource their actual manufacturing to China because production costs are so low. Thus, homeowners should think about what aspect of solar panel production is important to them: where the components are made, where the solar panel is manufactured and/or where the company is headquartered.
For example, Canadian Solar, a popular solar panel company that is headquartered in Canada, makes its panels in China. So, if you don’t want solar panels manufactured in China, looking to the country of headquarters may not always be the best indicator.
On the opposite front, there are some manufacturers that are headquartered abroad but make their panels in America. SolarWorld, a leading manufacturer that is known for having some of the most competitive prices in residential solar, is a German company that outsources its production to the U.S. So when thinking about Chinese solar panels, it depends on what matters most to you: where the panels are physically made, where the company is officially headquartered or something else entirely.
Are Chinese solar panels cheaper than other brands? Solar tariff update
Although there isn’t a universal truth when it comes to price or quality regarding solar panels, it is safe to say that Chinese solar manufacturers typically offer lower prices than other brands because of the incredibly low cost of production in China. This contrast between Chinese and specifically American solar panels has recently gotten some media attention following the bankruptcy of U.S. solar maker Suniva. After filing for Chapter 11 bankruptcy in early 2017, Suniva filed a petition with the United States International Trade Commission (USITC) to suggest a hefty tariff be placed on solar panel imports from China.
In short, Suniva claimed that their bankruptcy occurred due to unfair competition. The manufacturer hails from Atlanta, Georgia with production facilities in Georgia and Michigan, and claimed that low prices from competitors who outsource to China and other Asian countries prevented them from making a profit and staying afloat.
On January 22nd, 2018, the Trump Administration levied a 30% tariff on solar imports to the United States. The tariff covers both imported solar cells, a key input to manufacturing solar panels, and solar modules, otherwise known as solar panels. According to a fact sheet released by the U.S. Trade Representative, this tariff will last for four years and will fall by 5% annually, dropping to a 15% tariff in 2021. To learn more, read our complete analysis of the solar tariff and its expected impact on solar prices.
To get a better sense of what is made where, take a look at the top panel brands, where they’re headquartered, and where their equipment is actually produced:
Leading solar panel brands: headquarters and manufacturing origin Solar panel manufacturersCompany headquartersSolar panels manufactured in... AleoGermanyGermany, China AxitecU.S.Canada, China Canadian SolarCanadaChina, Canada, Brazil CentrosolarGermanyChina, Germany, U.S. ET SolarChinaChina, Malaysia HyundaiSouth KoreaSouth Korea ItekU.S.U.S. KYOCERA SolarJapanMexico, U.S. LGSouth KoreaSouth Korea, U.S. Phono SolarChinaChina REC SolarNorwaySingapore ReneSolaChinaChina, Japan SolarWorldGermanyU.S. SunPowerU.SFrance, Mexico, Philippines, U.S. Trina SolarChinaChina, Malaysia, Thailand, Vietnam WinaicoTaiwanTaiwan Yingli SolarChinaChina, Taiwan
Are Chinese panels lower quality than other manufacturer brands?
Moving on to the question of whether solar panels manufactured in China are of lower quality than other manufacturer origins (a concern we hear frequently from homeowners), the straightforward answer is “no they are not lower quality”. The specific country that a solar panel is made in will have little impact on the actual quality of the product put on your roof. In the above table, two trends are evident:
The large majority of solar manufacturing occurs in Asia, with many top solar panel brands producing their products in China.
Solar panels of all ranges in quality are made in China so there is no current correlation between the level of panel quality and whether it’s produced in China or elsewhere.
The data table above shows that the only reason a homeowner should use country of origin to select solar panels is an external reason unrelated to quality or price, such as a desire to buy “Made in the USA” products or help stimulate American manufacturing jobs.
In terms of how a homeowner could effectively compare the quality of different solar panel brands, there are a few third-party certifications that can be very helpful. TUV Rheinland is a database and organization that tests and evaluates manufacturing facilities and products. By searching for the panel brand you are considering, you can verify that they have certified production practices and a quality product.
Another third-party resource you can use is our very own. In collaboration with the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL), EnergySage invented its own proprietary solar panel rating system so that homeowners can easily compare their panel quality on an apples-to-apples basis. To learn more about our rating system, read our guide to selecting solar panels. Now that we’ve covered questions around whether Chinese solar panels make sense for you or not, read on for further guidance about how to get the most out of your solar shopping experience.
Three Tips for Solar Shoppers
1. Homeowners who get multiple quotes save 10% or more
As with any big ticket purchase, shopping for a solar panel installation takes a lot of research and consideration, including a thorough review of the companies in your area. A recent report by the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) recommended that consumers compare as many solar options as possible to avoid paying inflated prices offered by the large installers in the solar industry.
To find the smaller contractors that typically offer lower prices, you’ll need to use an installer network like EnergySage. You can receive free quotes from vetted installers local to you when you register your property on our Solar Marketplace – homeowners who get 3 or more quotes can expect to save $5,000 to $10,000 on their solar panel installation.
2. The biggest installers typically don’t offer the best price
The bigger isn’t always better mantra is one of the main reasons we strongly encourage homeowners to consider all of their solar options, not just the brands large enough to pay for the most advertising. A recent report by the U.S. government found that large installers are $2,000 to $5,000 more expensive than small solar companies. If you have offers from some of the big installers in solar, make sure you compare those bids with quotes from local installers to ensure you don’t overpay for solar.
3. Comparing all your equipment options is just as important
National-scale installers don’t just offer higher prices – they also tend to have fewer solar equipment options, which can have a significant impact on your system’s electricity production. By collecting a diverse array of solar bids, you can compare costs and savings based on the different equipment packages available to you.
There are multiple variables to consider when seeking out the best solar panels on the market. While certain panels will have higher efficiency ratings than others, investing in top-of-the-line solar equipment doesn’t always result in higher savings. The only way to find the “sweet spot” for your property is to evaluate quotes with varying equipment and financing offers.
For any homeowner in the early stage of shopping for solar that would just like a ballpark estimate for an installation, try our Solar Calculator that offers upfront cost and long-term savings estimates based on your location and roof type. For those looking to get quotes from local contractors today, check out our quote comparison platform.