Renewable Energy, Solar & Wind Manufacturing worked example

Solar Warranty Exposure at 1.08% expected field failure rate: a worked example

This worked example runs the solar warranty exposure numbers for a tougher week than the baseline: 1.08% expected field failure rate instead of the typical 1.5%. Estimates the dollar warranty liability carried on a batch of shipped PV modules given an expected field failure rate.

The inputs for this scenario

  • Modules shipped under warranty: 50,000 modules (held at the documented default)
  • Average claim cost per module: 180 $/module (held at the documented default)
  • Expected field failure rate: 1.08 % (the input this scenario stresses; the baseline uses 1.5)
  • Fixed warranty program administration cost: 25,000 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Total exposure = modules x claim cost per module x failure rate% + fixed admin cost.
  • Total solar warranty exposure cost works out to 122,200 $ at these inputs, and this is the headline figure for the scenario.
  • Solar warranty exposure cost per unit works out to 2.44 $ / piece at these inputs.
  • Variable solar warranty exposure cost works out to 97,200 $ at these inputs.
  • Fixed solar warranty exposure adder works out to 25,000 $ at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where expected field failure rate sits at 1.5% and the headline result is 160,000 $, this scenario comes in 23.63% below the baseline at 122,200 $.
  • Use it when setting warranty reserves, pricing a new module SKU, or evaluating how a field-failure-rate change moves your liability. A result at this level usually justifies acting on the stressed input before touching anything else, because every other figure in the table is downstream of it.

Results at a glance

  • Total solar warranty exposure cost: 122,200 $ (headline result)
  • Solar warranty exposure cost per unit: 2.44 $ / piece
  • Variable solar warranty exposure cost: 97,200 $
  • Fixed solar warranty exposure adder: 25,000 $

Run it with your numbers

  • To rerun this with your own numbers, open the live Solar Warranty Exposure calculator, set expected field failure rate to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.