Read a 25-Year Solar Production Forecast: First Year and Degradation

Identify what the opening-year number represents

Label the modeled energy value in kWh and identify whether it represents a full operating year, an actual calendar year or another interval. Save the location, weather-data identity, equipment, layout and loss assumptions with that value. A partial installation year should not quietly be compared with twelve months of modeled operation.

The PVWatts V8 API provides annual and monthly AC energy outputs, with separate weather and input records. [2] A later spreadsheet may extend that result using additional assumptions. Ask the preparer to show where the model output ends and the long-term projection begins, so the two are not presented as one independently verified forecast.

Ask whether the annual change is linear or compounded

Write down the annual degradation assumption, the source for that choice and the year in which it first applies. In a linear calculation, a fixed fraction of the initial baseline is deducted for each elapsed year. In a compounded calculation, each year’s reduction is applied to the remaining value. A percentage without its method is incomplete.

SAM’s documentation says a single degradation rate for its PVWatts and Detailed Photovoltaic models is applied linearly; other modes can use different treatment. [1] Do not assume that a separate sales spreadsheet uses the same formula. Ask for the formula or an exported table rather than inferring it from the slope of a chart.

Work through one clearly hypothetical 25-year example

Suppose a first full year is modeled at 12,000 kWh and a purely illustrative degradation assumption is 0.5% annually, beginning in year two. A linear calculation gives year 25 as 12,000 × (1 − 0.005 × 24) = 10,560 kWh. A compounded calculation gives 12,000 × 0.995^24, approximately 10,640 kWh. There are 24 reductions between year one and year 25, not 25.

Neither example recommends a degradation rate or predicts a particular product’s output. Their purpose is to expose the calculation. Ask the preparer to reconcile the first, second and final rows and the cumulative total. Do not use the final-year value as though it were the average production of all 25 years.

Keep weather, outages and warranty language separate

A smooth degradation line is not a prediction of actual weather in every future year. SAM notes that its multi-year simulation reuses the same weather file rather than reproducing future year-to-year weather changes. [1] Ask which allowances, if any, separately address downtime, maintenance or later equipment changes, and check that a loss is not counted twice.

Keep the manufacturer’s actual warranty document and any signed production commitment alongside the model, but do not substitute their terminology for the energy formula. Ask the issuer to explain the measurement basis, conditions and remedy of any claimed commitment. This guide does not determine an individual contract’s legal effect or treat a module-level provision as a whole-system energy guarantee.

Review financial assumptions independently of energy

If the report adds a 25-year savings chart, request separate rows for energy, electricity-price assumptions, payment obligations and other included costs. Changing assumed utility inflation can change a savings illustration without changing one panel’s modeled output. Ask for those assumptions to be visible and for uncertain inputs to be presented as scenarios rather than facts about future bills.

For a revised equipment selection or household plan, retain the previous report and rebuild the affected comparison. Origin’s review should explain the projection and its limits, not force a five-year break-even result or guarantee immediate lease savings. The useful next step is a coherent record of the selected design, consumption assumptions and unresolved questions for the property.

Primary sources

1. SAM Help: Degradation

   Checked October 20, 2026 for model-dependent linear versus compounded treatment, year-one handling and repeated-weather-file limitations. The 0.5% worked example is an editorial assumption, not a recommended or measured degradation rate.

2. National Laboratory of the Rockies: PVWatts V8 API

   Checked October 20, 2026 for annual/monthly AC energy and input/weather records. No current electricity tariff, incentive or financial outcome is supplied by this reference.

Planning examples and questions are Origin’s editorial guidance, not a property-specific diagnosis, engineering design, tax determination or promise of savings. Manufacturer and utility references do not imply an affiliation with Origin.

Related guidance

• Prepare the consumption baseline
• Check for duplicated loss assumptions
• Review lease and PPA obligations separately