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What Is Solar Panel Degradation? The Rates Explained

Solar panels slowly lose output over time. What degradation actually is, the typical yearly figure, and why warranties cover it.

WaterFuelAndSolarEnergy.com Editorial Team Updated November 2024 6 min read

Degradation is the gradual loss of a panel’s rated output over time. Most modern panels degrade about 0.3%–0.5% per year, meaning they still produce 88–92% of nameplate power after 25 years.

What drives it

  • Light-induced degradation right after installation
  • Heat, humidity and UV over the years
  • Micro-cracks and cell-level issues in rare cases
Does degradation mean I need to replace panels?
No — even at 90% after 25+ years, panels keep working. Degradation is gradual and accounted for when sizing your system.