NEW YORK — The costs of solar power are skyrocketing as companies try to make money from the nascent new energy sector.
Solar companies say they’re paying between $4 million and $5 million for new solar panels, and that’s for panels installed in just the past year.
But the price of a panel has soared more than 80 percent since last year.
So far this year, solar companies have installed more than 10.6 gigawatts, or about 4,600 megawatts, of solar, according to a report by the International Energy Agency.
That’s nearly 10 times the amount installed in the same period last year, the agency said.
The growth is partly because new solar projects are more costly to build and maintain, said Jason Gorman, an analyst at research firm SunEdison.
Solar companies are getting a bigger return on their investment than they expected.
Solar panels now cost between $400,000 and $500,000.
And the average price per watt has jumped nearly 80 percent in the past five years.
“What we’re seeing now is the growth in solar is not being driven by technology alone,” Gorman said.
“We’ve got a lot of new entrants that are trying to get into this market, and those guys are going to be paying a lot more for panels.
It’s not because they’re better.
It is a new technology, and it has a higher price tag.
It really is just the cost of production.
We’re talking $5 to $6,000 a watt now.”
Solar companies are hoping that the soaring prices will allow them to expand solar projects, with new projects at new locations.
Solar energy is a $3 trillion industry that has been growing faster than the rest of the U.S. economy, but the U