The 25-year warranty on a solar panel is not an expiry date. Panels rarely stop working; they slowly produce less, at a rate of roughly 0.4-0.5% a year, and a well-made panel is typically still delivering 85-90% of its original output after a quarter of a century. What fails first is almost always something else in the system.
What the two warranties actually promise
| Warranty | Typical term | What it covers |
|---|---|---|
| Product warranty | 10-25 years | Manufacturing defects — delamination, frame failure, junction box faults |
| Performance warranty | 25-30 years | That output stays above a stated percentage, commonly 85-90% at year 25 |
The performance warranty is the one describing degradation, and it is a floor rather than a prediction. Most panels comfortably beat it.
The degradation curve
Two phases. There is an initial drop in the first year — light-induced degradation, typically 1-3% — and then a slow linear decline of about 0.4-0.5% annually.
| Year | At 0.4%/yr | At 0.7%/yr |
|---|---|---|
| 1 | 98% | 97% |
| 10 | 94% | 91% |
| 20 | 90% | 84% |
| 25 | 88% | 81% |
| 30 | 86% | 77% |
A 400W panel at year 25 is still producing about 350W. That is a meaningful decline and nowhere near a failure — which is why plenty of 1990s installations are still generating today.
What actually ends a solar system
- The inverter. String inverters typically last 10-15 years and are the component you should budget to replace once during the panels' life. Microinverters generally carry 25-year warranties and last longer.
- The roof. If the roof needs replacing at year 15, the array comes off and goes back on — a real cost, and the reason to re-roof before installing.
- Connectors and wiring. MC4 connectors degrade under UV and thermal cycling, and a poor crimp becomes a hot spot years later. This is a common cause of mysterious output loss.
- Physical damage. Hail, falling branches and someone walking on a module. Micro-cracks from mishandling during installation are the insidious version — invisible at first, showing up as degraded output years later.
- The mounting. Corroded hardware or a failed roof penetration, which is a leak long before it is an electrical problem.
None of those is the panel. Budgeting for one inverter replacement is realistic financial planning; budgeting for panel replacement generally is not.
What accelerates degradation
- Sustained high temperature — the single biggest factor, and an argument for mounting with airflow underneath
- Thermal cycling in climates with large daily temperature swings
- Humidity and salt air, which attack seals and frames — coastal installations should use panels rated for it
- Micro-cracks from installation handling, hail or foot traffic
- Persistent partial shading, which can cause hot spots on the shaded cells
What this means for the payback numbers
Degradation makes payback marginally longer than a flat calculation suggests, while historic electricity price inflation pulls in the other direction and usually wins. For a first-pass estimate the two roughly cancel, which is why our payback guide leaves both out and says so.
The more useful framing: a system paying back in six years and degrading at 0.5% a year still delivers around nineteen more years of nearly-free electricity. The decline is real and it is not what determines whether solar was worth it.

