What if my Solar PV system generate energy less than expected?

When I read the comments on some Solar Power related FB pages, I saw comments that warned others who intend to install Solar Power systems. 

Saying that “It won’t work, you will regret the next two or three years. The efficiency will drop very fast…

Not sure about the intention of saying so, but it may affect the decisions of many people.

Certainly! The Solar PV Panel power generation output will degrade annually. What system on earth didn’t face degradation in efficiency after being run for some time?

But! The degradation rate of PV panels won’t be at a rapid rate that makes you regret it in 2 or 3 years time…

What's more the Solar PV Panel manufacturers are giving a performance warranty to their customers for as long as 25 years. 

Performance warranty means the manufacturers will guarantee you the power output of their panels from year 1 to year 25 years after factor in the degradation. 

Failing to achieve the said output, they will compensate you by either replacing the panels or in terms of monetary compensation.

The degradation rate of PV Panels guaranteed by the manufacturers usually is 2% in the 1st year, and 0.55% per year subsequently. Some manufacturers may have different guarantee rates. 

What does this 2% and 0.55% mean?

When the Solar Service Provider proposes a system size (kWp) to be installed at your premise, they will also tell you what is the estimated year 1 energy yield (kWh/ year).

The said estimation is usually based on software simulation or based on actual data from existing systems installed nearby.

By knowing the estimated year 1 energy yield and PV degradation rate. You can make a table like the following. For this case, the installed capacity is 50kW, and estimated yield is 63,875kWp for year 1. 

So the third column is the energy yield after factor in the degradation rate. And it is the output guaranteed by the PV Panel manufacturers. 

Your Solar PV system overall return of investment should be calculated based on the energy yield after factoring in the degradation rate. 

Thus, you can foresee the return before installing it, and the yield is guaranteed by the manufacturers.

Hence, actually there is no such thing like efficiency drop very fast and regret after two or three years.. 

And touch wood, if your panels have problems and the energy yield is much lower than expected, you’re still protected by the manufacturer's performance guarantee…