The Compound Trajectory: What a Kilowatt Is Actually Worth

Six variables, then the seventh multiplier

This series has taken the sky apart one variable at a time. Part 01 measured the heat penalty, part 02 the two-decade brightening and dimming, part 03 the year-to-year swing that P90 exists to price, part 04 the beam-and-diffuse split that decides where a tracker pays, parts 05 and 06 the soiling and smoke that block the light after it arrives, and part 07 the wind that cools the panel back down. Each moved output by a handful of percent. Taken alone, none overturns the intuition that a solar system belongs where the sun is strongest.

Taken together, and then multiplied by the one number this series had not yet joined in, they do exactly that. A solar asset does not earn kilowatt-hours; it earns money, and money is kilowatt-hours times the local price of power. When the climate-adjusted yield of each market is multiplied by its 2025 retail tariff, the ranking of where a kilowatt is worth most stops resembling the map of sunshine almost entirely:

Selected from the 23 priced markets. Net yield is the CERES-modelled specific yield (temperature already priced in, part 01) after subtracting the soiling loss (part 05); value is net yield times the 2025 residential tariff. Sun rank and value rank are within the 23 priced markets. Subsidised Gulf and Egyptian tariffs are the dominant reason their value collapses; full per-market notes and the tariff provenance are in the electricity-prices report and the public dataset.

The map of the sun is not the map of the money

The clearest way to see the compound effect is to rank each market twice, once by how much sun it gets and once by what its kilowatt earns, and watch how far markets travel between the two:

The northern-European markets climb almost the full height of the table. Berlin rises nineteen places, from twenty-second sunniest to third most valuable, because a modest but brightening resource (part 02), a low soiling loss in a rain-washed climate (part 05), a windy cooling advantage (part 07) and, above all, a high and unsubsidised tariff compound in the same direction. Madrid, Paris, Stockholm and Helsinki climb with it. The desert markets fall just as far: Riyadh drops twenty places from first to twenty-first, and Cairo lands dead last, because their formidable sun is met by heavy soiling, a dimming aerosol trend, and tariffs so subsidised that the energy a panel produces is worth almost nothing at the meter. Sun-rich, value-poor is not a paradox; it is the compound trajectory doing its arithmetic.

A few markets sit on the diagonal, where sun and value agree. Los Angeles is the rare market that is both genuinely sunny and priced at a high tariff, which is why it tops the value table outright; Perth and Santiago hold roughly their yield rank. And one market is missing from the value table entirely: Antofagasta on the Atacama plateau, the single strongest solar resource in the entire baseline at over 2000 kilowatt-hours per kilowatt, has no matched retail tariff in our price set, a fitting footnote to a report whose whole argument is that the best sunshine on Earth is not the same thing as the best place to earn from it.

How to read a market, the whole-series way

The compound trajectory is not a single score to be trusted blindly; it is a discipline for reading a market on every axis at once, and the series gives the checklist. Start with the resource, but immediately split it: how much light, and how much of it is beam versus diffuse (part 04), because that decides the mounting before anything else. Price the heat penalty against the module choice (part 01) and ask whether wind will refund part of it (part 07). Read the two-decade trend to know whether the sky is quietly brightening or dimming under your feet (part 02), and the year-to-year variability to size the P90 case and the battery (part 03). Subtract the soiling your climate will not wash off (part 05), and price the tail risk of a smoke season if you sit in one of the three regions that have one (part 06). Then, and only then, multiply by what a kilowatt-hour is worth where you stand, because that final multiplier is larger than every physical variable combined: the tariff spread across these markets is nearly twenty to one, while the entire physical yield spread is barely two to one. The gross price times yield join, without the climate penalties this report stacks on, is explorable market by market in The Value of a Kilowatt.

That ratio is the series' closing argument. The physics decides how many kilowatt-hours a panel makes, and it varies by about a factor of two from the Atacama to Reykjavik. The market decides what each of those kilowatt-hours is worth, and it varies by a factor of twenty. A buyer, an investor or a policymaker who optimises only for sunshine is tuning the smaller dial. The value of a solar kilowatt is a climate question and a market question at once, and the two must be read together or not at all.

Method and limits

Value is the CERES-modelled specific yield for each market (which already prices the operating-temperature loss of part 01) after subtracting that market's annual soiling loss (part 05), multiplied by its 2025 residential retail tariff in US dollars. Four limits are important. First, only 23 of the 40 markets have a matched 2025 tariff in our price set, so the value ranking is drawn from those 23; the physical pillars cover all 40. Second, this is the gross annual value of the energy a kilowatt produces, not a levelised cost or a payback: it deliberately excludes install cost, financing, net-metering and self-consumption rules, which vary as much as the tariff and would be a separate study. Third, the point estimate stacks only the annualisable pillars (temperature and soiling) onto yield and price; the trend (part 02), the variability band (part 03), the beam-diffuse mounting choice (part 04), episodic smoke (part 06) and the wind refund (part 07) are read alongside it as direction, risk and design rather than folded into one number, because averaging an episodic or directional term into a point estimate would misrepresent it. Fourth, subsidised and high-inflation tariffs distort the US-dollar value in both directions, which is a feature of the market being measured, not an error, and is flagged in the electricity-prices report. Every input is public and drawn from the named pillars of this series. The nine variables are read together, at their latest values, in the annual State of the Solar Climate.