Solar recycling: Driving down costs before volumes spike

As an entrepreneur building a global solar recycling business, I was very interested to see the latest report from the International Energy Agency. This report confirms what I have been seeing in the real world– the challenge and opportunity of creating a circular economy for solar energy is growing faster than most people think.

Here in the U.S., most studies agree that roughly 4-5 million panels per year are reaching end of life annually right now. And most agree that by 2040 that number will be in the tens of millions domestically and hundreds of millions globally. Opinions differ on when the industry will hit that inflection point, but our experience over the last few years is that the problem is growing fast and that the U.S. alone will likely hit 10 million retired panels per year before 2030 and then quickly go up and to the right from there.

If you take the time to read the full IEA report (at 152 pages), you will note that my projections are more aggressive. The primary reason for this is that their underlying model only looks at panels that break or severely underperform. This analysis misses the two biggest drivers of end of life volumes: 1) more extreme weather events like hailstorms that can destroy hundreds of thousands of panels in an instant; 2) early asset repowering to take advantage of more efficient panels and policy shifts.

Unlike other aspects of the solar industry, end of life projections are still very nascent. There’s no WoodMac research or any truly validated analysis that can definitively predict how this will look. And honestly, that’s fine. We founded SOLARCYCLE with the goal of figuring out advanced, high-recovery, high-efficiency and low-cost panel recycling before the world really needed it at the millions of panels per year scale that everyone agrees is coming. If the world waited until we reached that inflection point before building these businesses, the costs would be so high it would be potentially cataclysmic to corporate balance sheets.

A single gigawatt (GW) of solar may be comprised of 2-3 million panels, depending on when it was built. When we launched SOLARCYCLE 4 years ago, we charged $18 per panel (including shipping). At that time, volumes were small enough that no single company shouldered too much of that cost. But imagine if we waited to launch until our customers were repowering some of their 1GW projects? Customers could be paying as much as $40-50 million in just recycling costs.

But we saw this coming and started tackling this issue early––optimizing our cost structure since 2022. We’ve built out reverse logistics capabilities and off-take networks and, most crucially, innovated high-recovery high-speed recycling technology, which not only significantly improved pricing, but also set the industry on track to scale.  By the end of this decade, when we believe the volumes go hard up and to the right, we will have achieved one of our big hairy audacious goals: “landfill parity”, or the point at which recycling a solar panel is no more expensive than sending it to the landfill.

Part of my confidence comes from my hard-earned first-hand knowledge that landfilling is not nearly as cheap as many people believe. Indeed, this IEA report still claims that you can landfill a panel in the U.S. for between $1-5. That is potentially true in very rare circumstances, for example if your project is directly next to a compliant landfill and your panel was made with very little lead. But the reality is that in most cases the all-in cost of landfilling a non-hazardous panel in the U.S. is closer to $9 per panel.

While the landfill itself costs less than half this amount, the specialized end-dump truck required to get your panel there is significantly more expensive than a standard 53’ trailer. If you need to recycle older panels, that are likely soldered with more lead and more likely to be considered hazardous by the EPA, you’ll face even further costs and complications. You could be paying north of $17 per panel––that is, once you find one of the few hazardous landfills in the country to even accept it.

Landfilling a few hundred panels that break during construction or during normal operations and management is not that big of a deal. But once you’re dealing with millions of panels per year, you need a solution that can scale without breaking project economics.

This is part of the reason so many of our customers and investors have joined our mission to create an advanced, high-efficiency and low-cost solution. They see the challenge ahead and the opportunity to get it right. If we continue to invest in solar panel recycling now, the industry will be ready to address high volumes of retired solar panels and recycle those panels into the next generation of clean energy technologies.

Jesse Simons is the co-founder and chief strategy officer of SOLARCYCLE.

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