16th September 2026
Solar panels are becoming so cheap that they are beginning to change the way ordinary households can think about generating electricity.
For years, solar power in Britain generally meant putting several thousand pounds into a professionally installed system on the roof. That is still the main market, but something rather different has now arrived.
Since 27 August, compliant plug-in solar systems have been legal in Great Britain. The new rules allow systems with an output of up to 800 watts to be connected through a normal household socket, opening up solar generation to people who may not have a suitable roof or who simply cannot afford a conventional installation. The Government says a plug-in system could save a household up to £110 a year, although the actual saving will depend on the amount of sunshine, the position of the panels and how much of the electricity is used in the home.
And the prices are already attracting attention.
One of the cheapest complete systems currently available is listed by City Plumbing at about £432. That is a complete plug-in kit rather than simply a solar panel. It includes 940 watts of solar panels, an inverter and the equipment required to connect the system.
Other systems are appearing at around £440 to £500, while larger and more sophisticated systems can cost £600, £800 or £900. Argos, for example, is selling UKSOL systems starting at £599, while an 890W two-panel system is listed at £849 and a 1,030W system at £899.
Screwfix has also entered the market with a two-panel system containing 460W panels and an 800W micro-inverter for £669.
The important thing about these prices is that the consumer is not paying hundreds of pounds simply for the solar panels.
The panels themselves have become an extraordinarily cheap commodity.
China's extraordinary price advantage
Chinese solar modules are now being traded at roughly 11 cents per watt, with recent prices around $0.10 to $0.12 per watt.
That means a 400W panel can contain only around $44 worth of solar-module manufacturing cost at those market prices.
Of course, nobody in Britain is going to buy a panel for $44 and plug it straight into a wall socket.
The complete system needs an inverter, mounting equipment, cables, electrical protection and equipment designed to meet British requirements. There are also transport costs, VAT, distribution costs and retailer margins.
Nevertheless, the underlying economics are remarkable.
Solar panels have gone from being a relatively expensive piece of technology to something approaching a mass-produced commodity.
And that is largely because China has built an enormous solar manufacturing industry.
China didn't just build factories
China's advantage is not simply that its factories are large.
It has developed an integrated supply chain covering polysilicon, wafers, solar cells and finished modules. The International Energy Agency estimates that China accounts for more than 80% of manufacturing capacity across the major stages of the solar photovoltaic supply chain.
That scale creates a formidable advantage.
When a manufacturer is producing enormous quantities of a standardised product, the cost of each additional panel falls. Suppliers are nearby, equipment is readily available and factories can operate at enormous scale.
It is difficult for a country starting from scratch to compete with that.
But the extraordinary fall in prices has also created an unusual problem for China itself.
There is now so much manufacturing capacity that the industry has experienced severe price competition and overcapacity.
The result is good news for anyone wanting to buy solar panels.
It is much less good news for the companies making them.
Can Britain compete?
Britain is unlikely to compete successfully by trying to manufacture basic solar panels at the same price as China.
A British factory would have to compete against a supply chain that has been developing for decades and operates on an enormous scale.
But that does not necessarily mean Britain has to abandon the solar industry.
The real opportunity may be further down the chain.
The solar panel is only one part of the system.
There are inverters, batteries, monitoring equipment, energy-management software, mounting systems and electrical equipment. There are also companies that integrate all these components into systems designed for particular markets.
That is potentially a much more realistic opportunity for Britain and other European countries.
Instead of asking whether Britain can make a solar panel for the same price as a Chinese manufacturer, the question could be whether British companies can make the best complete energy system.
India is trying something different
India is one of the countries attempting to develop a much larger domestic solar manufacturing industry.
It has been investing heavily in domestic production and trying to reduce dependence on Chinese imports.
Other countries in Southeast Asia are also expanding their solar manufacturing industries.
The United States has taken a different approach, using tariffs and government incentives to encourage domestic production.
Europe faces the same dilemma.
It wants domestic manufacturing for reasons of industrial policy and energy security, but European production costs are generally higher than China's.
That raises an important question.
Should governments pay more for domestically produced panels in order to create manufacturing capacity, or should they simply buy the cheapest panels available and concentrate domestic investment on the parts of the industry where they can genuinely compete?
There is no simple answer.
Britain's new market could grow quickly
The arrival of plug-in solar makes the issue much more visible to ordinary consumers.
A household does not necessarily need to spend £7,000 or £10,000 installing a large rooftop system.
It can now consider spending several hundred pounds on a small system.
The cheapest complete kits currently appearing on the British market are around £430 to £470, although larger systems can cost considerably more.
That is a significant psychological change.
Someone who would never consider spending thousands of pounds on solar might be prepared to spend £450 on a couple of panels.
The economics will depend on the individual home. A system producing electricity during the day is much more useful to someone running appliances, working from home or charging equipment during daylight hours than to someone who is out all day.
And Britain's weather has to be taken into account.
Solar panels do not stop working when clouds appear, but their output falls substantially. Orientation, shading and the location of the panels can therefore make a considerable difference to the annual generation.
The panel could become the cheapest part
There is perhaps a bigger lesson here.
For decades, the expensive part of solar power was the solar panel itself.
That is increasingly changing.
The panel is becoming so cheap that other components of the system are starting to account for a much larger share of the final price.
That could create opportunities for companies outside China.
China may continue to dominate mass production of the panels, while other countries concentrate on the technology that turns those panels into useful energy systems.
And batteries could become particularly important.
If a household can generate electricity during the day and store some of it for the evening, the value of each panel increases because more of the electricity can be consumed rather than wasted or exported.
The combination of cheap Chinese panels, inexpensive batteries and increasingly sophisticated energy-management systems could therefore be considerably more disruptive than cheap solar panels alone.
A new solar price war?
The most interesting question now may not be whether solar panels can become cheaper.
They already have.
It is whether prices have fallen far enough to trigger another wave of demand.
If a complete plug-in system can increasingly be bought for £400 or £500, solar generation starts moving from being a major home-improvement project towards being an ordinary consumer purchase.
That could change the market.
China has already demonstrated that it can make solar panels extraordinarily cheaply.
The next stage may be a race to see who can turn those cheap panels into the cheapest and most useful energy system.
For Britain, that may mean accepting that it cannot beat China at manufacturing commodity solar panels while concentrating instead on the technology surrounding them.
The solar revolution may have started with the panel.
The next battle could be over everything that connects that panel to the home.