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Climate Change Boosts Value of Rooftop Solar Power Systems for Homes

In a recent paper published in the journal Nature Climate Change, researchers from the University of Michigan revealed that greater adoption of rooftop solar technology could accelerate efforts to decarbonize the power generation system in the United States and worldwide.

Waterfall charts showing the average change in household revenues from solar per unit of installed solar under a moderate climate warming scenario (RCP 4.5). Subplots (a) and (b) show the changes from 2000 to 2050 and 2100, respectively. Purple bars indicate the total change in household revenues. Blue and orange bars isolate the effects of household cooling and solar radiation changes, respectively, on household revenues.
Waterfall charts showing the average change in household revenues from solar per unit of installed solar under a moderate climate warming scenario (RCP 4.5). Subplots (a) and (b) show the changes from 2000 to 2050 and 2100, respectively. Purple bars indicate the total change in household revenues. Blue and orange bars isolate the effects of household cooling and solar radiation changes, respectively, on household revenues. Image Credit: Shi et al. in Nature Climate Change, 2024.

The study projects that by the end of the century, residential rooftop solar panels in the United States will be worth up to 19% more due to climate change.

The study characterizes the value of solar, abbreviated as VOS, as the financial gain at the household level derived from savings on electricity bills and earnings from surplus electricity sold to the grid, subtracting the initial installation expenses.

The authors estimated that by the end of the century, increased income from residential rooftop solar could reach hundreds of dollars per year for many American households.

Given the average 25-year lifespan of a rooftop solar installation, a system built today will nearly experience 2050 weather.

Michael Craig, Study Senior Author and Assistant Professor, Energy Systems, School for Environment and Sustainability, University of Michigan

Craig, who is also an Assistant Professor of Industrial and Operations Engineering at U-M’s College of Engineering, continues, “So, it’s important for households to think of future value when building solar. If households do so, our findings indicate they would see even greater value from solar, and might decide to build more.”

The study indicates that heightened public awareness regarding the augmented future worth of rooftop solar might drive increased technology adoption. Consequently, this could expedite endeavors aimed at decarbonizing the power generation system both within the United States and worldwide.

The study’s anticipated financial gains were mostly caused by rising residential air conditioning demand due to global warming. The researchers assert that future solar panel performance in response to climate change is another important factor influencing the value of rooftop photovoltaic systems.

Craig and colleagues employed a moderate climate-warming scenario known as RCP-4.5 to estimate air-conditioning demand and solar panel performance under future climates. They did this by analyzing data from 2,000 households in 17 US cities.

Rooftop solar panels have increased in value in almost every city, in both warm and cold climates. Miami recorded the biggest increase in value, whereas Minneapolis was the only city where rooftop solar benefits for homes decreased.

This is the first study to quantify the value of rooftop solar under climate change, and we show that households across the U.S. will realize greater cost savings from rooftop solar under future weather than under historic weather.

Mai Shi, Study Lead Author and Former Visiting Doctoral Student, University of Michigan

Mai Shi is now at Tsinghua University in Beijing.

According to the study, owners of rooftop solar systems will benefit as more solar-generated electricity is used for home cooling rather than being sold to the electrical grid. This is because home cooling demands are rising.

This occurs because, in numerous states, solar energy utilized for home electricity consumption slashes the homeowner's electric bill by the full retail price of electricity. Conversely, electricity fed back into the grid receives compensation at a reduced rate.

Craig said, “Greater cooling demand means more solar power is consumed at the household rather than sent back to the grid. And it’s generally more valuable for a rooftop photovoltaic owner to consume the power generated by their PV panel, rather than exporting it to the grid.”

All 17 cities under study anticipate a rise in demand for residential space cooling under the moderate RCP-4.5 climate scenario. According to the researchers, cooling demand across all households in all cities will rise by an average of 35% by the middle of the century and by an average of 64% by the end.

Solar panel performance in response to temperature rise and cloud cover variations will also significantly impact the future value of residential rooftop photovoltaics.

Solar panels exhibit optimal performance in cool, sunny conditions. However, their electricity generation diminishes as air temperature rises or cloud cover increases. The study reveals that forthcoming solar panel efficiency will fluctuate across the United States, contingent upon regional weather patterns.

Rising air temperatures will reduce the efficiency of solar panels in cities like Ann Arbor, Austin, Chicago, Dallas, Detroit, Houston, Louisville, and Milwaukee; however, a decrease in cloud cover will probably increase the amount of sunlight that reaches the panels on average.

The researchers say the two factors “are opposing but roughly comparable,” meaning they cancel each other out.

However, due to climate change, cities like Phoenix, Los Angeles, Los Angeles, Baltimore, Minneapolis, New York City, and Los Angeles are predicted to get warmer and cloudier, which will “significantly decrease” the electrical output of rooftop solar.

Nevertheless, the research indicates that rising cooling demand across all 17 cities will probably offset variations in panel electrical output, providing rooftop solar owners with profits in almost all cases. Minneapolis is an exception, as there will be minimal future rises in the demand for cooling air combined with a decline in rooftop solar electricity production.

Craig notes that while future financial benefits from rooftop solar will primarily favor households that can afford panel installation, several programs aim to enhance accessibility. This broader outreach aims to ensure a wider demographic can partake in the anticipated advantages.

For instance, some initiatives help lower-income people afford solar energy. Governments can also cover the capital costs and offer solar benefits to tenants by installing rooftop solar panels in public buildings, such as affordable housing. Furthermore, whole communities, even households without the resources or capacity to install rooftop solar panels, can benefit from community solar programs.

Xi Lu from Tsinghua University is the other author of the Nature Climate Change paper, in addition to Craig and Shi.

The study was funded by the National Natural Science Foundation of China, the National Science Foundation of the United States, the National Key R&D Program of China, and the Carbon Neutrality and Energy System Transformation Project.

Journal Reference:

Shi, M., et al. (2024). Climate change will impact the value and optimal adoption of residential rooftop solar. Nature Climate Change.


  1. Sean Benton Sean Benton India says:

    This is a fascinating read! The increasing awareness of climate change is not only driving environmental action but also boosting the value of rooftop solar power systems for homes. It's inspiring to see how renewable energy solutions are gaining traction. For homeowners considering investing in solar, consulting with reputable solar panel contractors is essential to ensure a smooth transition and maximize the benefits. Let's harness the power of the sun to combat climate change and create a brighter future!

The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of

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