How Much Power Do Solar Panels Lose Each Year?

Modern solar panels lose roughly 0.3% to 0.8% of their output every year, with about 0.5% the figure most commonly used in industry warranties and projections. That means a panel installed today should still be producing somewhere between 85% and 92% of its original output after 25 years, which is exactly the window most manufacturer performance warranties cover.

Two different kinds of loss, often confused

• Light-induced degradation (LID): a one-off drop of 1 to 3% that happens in the first hours or days a panel is exposed to sunlight, caused by a chemistry shift in the silicon itself. It’s built into a panel’s rated output and doesn’t keep happening year after year.
• Ongoing annual degradation: the slow, steady decline that continues for the rest of the panel’s life, typically 0.3 to 0.8% a year depending on the panel technology and how it’s manufactured.

People sometimes read “2% first-year loss, then 0.5% annually” on a warranty sheet and assume the panel keeps losing 2% every year. It doesn’t, that first number is a one-time adjustment, not a recurring rate.

Where the 0.5% figure actually comes from

The widely cited baseline traces back to a meta-analysis of field data from thousands of panels across dozens of studies, which found a median degradation rate of around 0.5 to 0.6% a year for crystalline silicon panels, the type on almost every UK roof. That’s an observation drawn from panels that have actually been in the field for years, not a manufacturer’s projection.

Newer N-type panels (TOPCon and HJT cell technology, now common in 2026 installs) are marketed with lower degradation rates, often 0.3 to 0.4% a year, based on manufacturer testing rather than decades of independent field data, since the technology itself is still relatively new to widespread deployment. That’s a reasonable expectation given the underlying physics, but it’s worth being clear that it’s a claim about newer panels rather than a confirmed 25-year track record the way the older figure is.

What your warranty actually promises

Warranty terms vary by brand and panel tier, and they’re worth checking directly on your own quote rather than assuming a standard figure applies.

Panel tier	Product warranty	Performance warranty	Guaranteed output at year 25 to 30
Standard P-type PERC	10 to 12 years	25 years	Around 84 to 87%
Premium N-type TOPCon	12 to 25 years, varies by market	30 years	Around 87% at year 30
Premium HJT (e.g. REC Alpha Pure)	20 years	25 years	Around 92% at year 25

The product warranty covers physical defects and workmanship. The performance warranty is a separate, usually longer promise about output specifically, and it’s the one that matters for degradation.

Does any of this actually show up on your bill

Barely, in any given year. Losing 0.5% of output between one year and the next is smaller than the swing you’d see from one unusually cloudy summer to the next, so it’s not something you’ll notice on your meter readings. It matters over the full 25-year horizon, where the difference between a panel degrading at 0.3% and one degrading at 0.8% adds up to a meaningfully different total output, which is one of several things that feeds into your payback calculation.

What actually cuts output faster than normal degradation

Gradual degradation is rarely the reason a system underperforms. The more common culprits are:

• Dirt, moss or debris sitting on the panel surface, which is a cleaning problem, not a degradation one. See our maintenance and cleaning guide.
• New shading from a tree that’s grown taller or a neighbouring extension since your system was installed.
• A failed component, such as an optimiser, microinverter or a single faulty panel, which causes a sudden drop rather than a gradual one.

If your generation drops noticeably between one year and the next, look at these first. That kind of step-change isn’t what normal degradation looks like.

Bottom line

A small, steady decline in output is normal and already priced into every payback estimate you’ll be given. What’s worth doing is checking the specific performance warranty on your own quote, since it varies more between brands than most homeowners expect, rather than assuming every panel degrades at the same rate. Get matched with vetted installers who can talk you through the warranty terms on the panels they’re actually quoting.

Frequently asked questions