The average expected lifespan of solar power plants in the United States has jumped more than 10 years since 2007 to nearly 33 years, Lawrence Berkeley National Laboratory said in a new report released June 2.

The estimate is based on a survey conducted by LBNL of 19 project developers, asset owners, consultants and other market participants whose current estimates for the useful life of solar photovoltaic, or PV, projects ranged from 25 to more than 35 years. That compares with typical 25- to 30-year warranties on solar panels, LBNL researchers noted. LBNL is a U.S. Department of Energy laboratory managed by the University of California.

Longer lifespans, in turn, could give developers a longer "merchant tail" — the remaining useful life after a fixed-price power purchase agreement has ended — on their projects, according to the report. "Expectations for a profitable merchant tail (which may or may not ultimately be fulfilled) helps enable aggressive pricing for initial power sales agreements," LBNL researchers said.

While some banks financing renewable energy projects say they would prefer longer contracts over merchant tails, longer project lives and falling operating expenses have contributed to plummeting energy prices of large-scale PV plants over the past decade, the researchers said.

The average levelized cost of energy of U.S. solar power plants dropped to $51/MWh in 2019, excluding the federal investment tax credit, from $305/MWh for projects built between 2007 and 2009, according to the analysis. The 2019 levelized cost estimate would be 43% higher were it not for advances in project life expectancy and lower operating expenses, the report added.

Actual contract prices for some recent projects, including the impact of federal tax incentives, have fallen below $20/MWh, LBNL said in a separate report published in December.

Among such sub-$20/MWh solar farms is Capital Dynamics AG's 400-MW Eland Solar and Storage Center, a two-phase project near the Mojave Desert town of California City, Calif. The Los Angeles Department of Water and Power in 2019 approved contracts with developer 8minute Solar Energy LLC that are priced at $19.97/MWh for solar only and range from $32.97/MWh to $39.62/MWh for solar coupled with large-scale lithium-ion batteries.