Installation Costs are costs associated with installing the system, and include equipment, labor, engineering, permitting, and any other costs that apply in Year 0 of the project cash flow. Some costs, such as debt-related and sales tax costs are specified on the Financial Parameters page.
SAM uses the variables on the Installation Costs page to calculate the project investment cost and annual operating costs reported in the project cash flow and used to calculate cost metrics.
Recurring costs that apply in Years 1 and later of the project cash flow are on the Operating Costs page.
Variable values in boxes with white backgrounds are values that you can edit. Boxes with blue backgrounds contain calculated values or values from other pages that SAM displays for your information.
SAM provides the categories under Direct Capital Costs and Indirect Capital Costs for your convenience to help keep track of project installation costs. Only the Total Installed Cost value affects the cash flow calculations, so you can assign capital costs to the different cost categories in whatever way makes sense for your analysis. For example, you could assign the cost of designing the array to the module cost category or to the engineering category with equivalent results. After you assign costs to the categories, you should verify that the total installed cost value is what you expect.
Notes.
The default cost values that appear when you create a file or case are intended to illustrate SAM's use. The cost data are meant to be realistic, but not to represent actual costs for a specific project. For more information and a list of online resources for cost data, see the technology pages on the SAM website.
The Installation Costs page only available for cases with a cash-flow-based financial model. It is not available with the No Financial Model option or the LCOE Calculator financial model.
Direct Capital Costs
A direct capital cost represents an expense for a specific piece of equipment or installation service that applies in year zero of the cash flow.
Note: Because SAM uses only the total installed cost value in cash flow calculations, how you distribute costs among the different direct capital cost categories does not affect the final results.
Module Cost, $/Wdc or $/Unit
For the detailed photovoltaic model, the module cost is expressed per unit or per DC Watt:
•Dollars per DC watt multiplied by Nameplate Capacity (at reference conditions) on the System Design page, or
•Dollars per unit multiplied by Total Modules on the System Design page.
For PVWatts, the module cost is expressed per unit or per DC Watt:
•Dollars per watt multiplied by Nameplate Capacity on the PVWatts System Design page, or
•Dollars per unit, where the number of modules is assumed to be one.
Inverter, $/Wac or $/Unit
For the detailed photovoltaic model, the cost of inverters in the system is expressed in dollars per AC Watt or dollars per inverter:
•Dollars per AC watt multiplied by Total Inverter Capacity on the System Design page, or
•Dollars per unit multiplied by Number of Inverters in the Actual Layout column on the System Design page.
For PVWatts, the inverter cost is either dollars per watt or dollars per inverter:
•Dollars per watt multiplied by the product of DC Rating and DC to AC Derate Factor on the System Design page, or
•Dollars per unit where the number of inverters is assumed to be one.
Battery, $/kWh and $/kW
For systems with batteries, the battery installation cost is expressed in $/kWh of total battery capacity, $/kW of maximum charge/discharge power, or both. Specify the battery replacement cost separately using the $/kWh cost on the Operating Costs page.
PV Battery:
•Dollars per kilowatt-hour multiplied by Nominal bank capacity on the Battery Cell and System page.
•Dollars per kilowatt multiplied by the Maximum discharge power on the Battery Cell and System page.
PVWatts Battery:
•Dollars per kilowatt-hour multiplied by Battery capacity on the System Design page.
•Dollars per kilowatt multiplied by the Battery power on the System Design page.
Balance of System, Installation Labor, Margin and Overhead
The other direct capital cost categories, Tracking Equipment (HCPV only), Balance of system, Installation labor, and Installer margin and overhead can be specified using three units. SAM calculates the total amount for each category as shown below.
$
A fixed cost in dollars.
$/Wdc
A cost proportional to the system's DC nameplate capacity, equal to the Nameplate Capacity on the System Design page for the detailed photovoltaic model, or the DC Rating on the PVWatts System Design page for the PVWatts model.
$/m2
Applies only to the detailed photovoltaic model. A cost proportional to the total module area of the array in square meters, equal to the Total Area on the System Design page. This option is not active for the PVWatts model.
Contingency (%)
A percentage of the sum of the equipment, balance-of-system, installation labor, and installer margin and overhead costs that you can use to account for expected uncertainty in the direct cost estimates.
Total Direct Cost ($)
The sum of equipment, system, installation labor, installer margin and overhead costs, and contingency costs.
Indirect Capital Costs
An indirect cost is typically one that cannot be identified with a specific piece of equipment or installation service.
Note: Because SAM uses only the total installed cost value in cash flow calculations, how you distribute costs among the different indirect capital cost categories does not affect the final results.
The five indirect cost categories, Permitting - Environmental Studies, Engineering, Grid interconnection are each calculated as the sum of the three values expressed with the following units:
% of Direct Cost
A percentage of the Total Direct Cost value shown under Direct Capital Costs.
Cost $/Wdc
A cost proportional to the system's DC nameplate capacity, equal to the Nameplate Capacity on the System Design page for the detailed photovoltaic model, or the DC Rating on the PVWatts System Design page for the PVWatts model.
Fixed Cost
A fixed cost in dollars.
Total
For each category, the total is the sum of the three units:
Total = % of Direct Cost × Total Direct Cost ($) + Cost $/Wdc × Nameplate Capacity (Wdc) + Fixed Cost ($)
Land Costs
SAM calculates the total land cost as the sum of Land and Land Preparation. The land cost categories use the Cost $/acre category in addition to the categories for the other indirect costs (% of Direct Cost, Cost $/Wdc, Fixed Cost).
Total Land Area
The total land area from the System Design page.
Cost $/acre
A cost in dollars per acre of total land area.
Total
For each land cost category, the total is the sum of the three units:
Total = Cost $/acre + % of Direct Cost × Total Direct Cost ($) + Cost $/Wdc × Nameplate Capacity (Wdc) + Fixed Cost ($)
Total Indirect Cost ($)
The sum of the five indirect cost categories.
Sales Tax (%)
Sales tax basis, %
The percentage of total direct cost used to the calculate sales tax amount.
SAM calculates the total sales tax amount by multiplying the sales tax rate from the Financial Parameters page by the sales tax basis on the Installation Costs page:
Total Sales Tax ($) = Sales Tax Rate (%) × Sales Tax Basis (%) × Total Direct Cost ($)
For an explanation of the effect of sales tax on income tax, see Sales Tax on the Financial Parameters topic for the financial model you are using (Residential, Commercial, Single Owner, etc.)
Total Installed Cost
The total installed cost is the sum of all of the direct and indirect capital costs and sales tax. SAM uses this value to calculate the project's net capital cost, which is the total installed cost less any cash incentives on the Incentives page and plus any additional financing costs from Financial Parameters page.
Total installed cost, $
The sum of total direct cost and total indirect cost.
Total installed cost per capacity
Total installed cost divided by the total system rated or nameplate capacity. This value is provided for reference only. SAM does not use it in cash flow calculations.
The units depend on the type of system: For photovoltaic systems: $/Wdc, for standalone battery systems: $/Wac, for other systems: $/kWac.
