The Real Reasons Solar Panel Efficiency Drops with Age

Solar panels are known for their long life and reliable performance. Once installed, they start producing clean electricity from sunlight for 25 years or even more. However, many homeowners and businesses notice that solar panels do not produce the same amount of power after several years as they did in the beginning. This is completely normal and happens due to a process called solar panel degradation.

In this detailed article, we will explain why solar panels lose efficiency over time, what factors are responsible for it, how much efficiency loss is expected, and what you can do to slow down this process. The language is kept simple and easy to understand.

What Does Solar Panel Efficiency Mean?

Solar panel efficiency refers to how well a solar panel converts sunlight into electricity.
For example, if a panel has 21% efficiency, it means 21% of the sunlight hitting the panel is converted into usable power.

When efficiency drops, the panel still works, but it produces less electricity than before.

Do Solar Panels Really Lose Efficiency?

Yes, all solar panels lose efficiency slowly over time. This is a natural aging process and does not mean the panel has failed.

On average:

• Solar panels degrade by 0.3% to 0.8% per year
• After 25 years, most panels still work at 80–85% of their original capacity

This is why manufacturers confidently offer 25-year performance warranties.

Main Reasons Why Solar Panels Lose Efficiency Over Time

1. Natural Aging of Solar Cells

Solar panels are exposed to sunlight every day for decades. Continuous exposure to:

• UV rays
• Heat
• Weather conditions

slowly changes the physical and electrical properties of the solar cells. This natural aging causes a gradual reduction in power output year after year.

This is the most common and unavoidable reason for efficiency loss.

2. Thermal Stress (Heat Damage)

High temperatures are one of the biggest enemies of solar panels.

• Solar panels perform best at around 25°C
• In hot climates, panel temperature can rise above 60–70°C

Repeated heating during the day and cooling at night causes thermal expansion and contraction, which:

• Creates micro-cracks in cells
• Weakens internal connections

Over time, this heat stress reduces the panel’s ability to generate power efficiently.

3. Micro-Cracks in Solar Cells

Micro-cracks are tiny cracks that develop in solar cells due to:

• Transportation
• Installation pressure
• Wind load
• Thermal stress
• Heavy snow or hail

These cracks are often invisible to the naked eye but can:

• Reduce current flow
• Create inactive areas on the panel
• Increase power loss over time

Poor handling during installation increases this risk.

4. Moisture and Humidity Ingress

If moisture enters the panel due to:

• Poor sealing
• Low-quality backsheet
• Aging of encapsulation material

it can cause:

• Corrosion of internal components
• Electrical leakage
• Faster degradation

This is more common in coastal, humid, and rainy regions.

5. Light-Induced Degradation (LID)

Light-Induced Degradation happens mainly in P-type solar panels during the first few months of operation.

• When panels are exposed to sunlight for the first time
• Chemical reactions inside the silicon reduce efficiency slightly

LID usually causes a 1–3% drop initially, after which performance stabilizes.
Modern technologies like N-type TOPCon panels have very low LID.

6. Potential-Induced Degradation (PID)

PID occurs due to:

• High system voltage
• Poor grounding
• High humidity and temperature

It causes leakage currents that reduce power output.
If not controlled, PID can lead to significant efficiency loss.

Quality solar panels with proper system design can prevent PID.

7. Dust, Dirt, and Pollution

Over time, solar panels collect:

• Dust
• Bird droppings
• Pollution particles
• Leaves

This does not permanently damage panels, but it:

• Blocks sunlight
• Reduces energy generation

In dusty areas, power loss can reach 10–20% if panels are not cleaned regularly.

8. Degradation of Encapsulation and Backsheet

The materials that protect solar cells (EVA, glass, backsheet) also age with time.

Common issues include:

• Yellowing of EVA
• Cracks in backsheet
• Loss of transparency

These reduce the amount of sunlight reaching the cells, lowering efficiency.

9. Poor Quality Materials and Manufacturing

Not all solar panels are made equal.

Low-quality panels may suffer from:

• Faster degradation
• Weak solder joints
• Inferior glass and frames
• Shorter lifespan

This is why choosing panels from trusted solar manufacturers is very important.

How Much Efficiency Loss Is Normal?

Good-quality panels maintain performance well within these limits.

How to Reduce Solar Panel Efficiency Loss

While degradation cannot be stopped completely, it can be slowed down.

Choose High-Quality Solar Panels

Panels with:

• Strong glass
• Advanced cell technology (TOPCon, HJT)
• Low degradation rate

last longer and perform better.

Proper Installation

Correct mounting prevents:

• Mechanical stress
• Micro-cracks
• Water entry

Always use trained installers.

Regular Cleaning

Cleaning panels every:

• 2–3 months in dusty areas
• 4–6 months in clean areas

helps maintain high output.

Good Ventilation

Panels with proper airflow underneath stay cooler and perform better in hot weather.

Routine System Check

Annual inspection helps detect:

• Loose connections
• PID issues
• Inverter or wiring problems

before they cause major losses.

Are New Solar Technologies Reducing Efficiency Loss?

Yes. Modern solar technologies are designed to minimize degradation.

• N-Type TOPCon panels → Very low LID & PID
• Better encapsulation materials
• Stronger glass and backsheets
• Improved cell designs

These advancements help solar panels maintain high efficiency for a longer time.

Conclusion

Solar panels losing efficiency over time is normal and expected. It does not mean your investment is failing. With quality panels, proper installation, and regular maintenance, solar systems can deliver clean and affordable electricity for decades.

Understanding the reasons behind efficiency loss helps you:

• Set realistic expectations
• Choose the right solar panels
• Take better care of your system

In the long run, even with slight degradation, solar panels remain one of the most reliable and cost-effective energy solutions for homes and businesses.