What is the derate factor and how is it used?

Derate is a term used to describe degrading factors that decrease solar energy output. This terms are given percentages that decrease or derate the amount of energy output. They are given values that are percentages that can be multiplied together. A three percent loss factor, for example, is a 97% derate factor, so energy output is multiplied by 0.97. PV Designer treats these factors the same way as the popular estimation tool called PV Watts, and the derate factors are described more at http://rredc.nrel.gov/solar/codes_algs/PVWATTS/version1/derate.cgi. PV Designer is different in at least two areas: inverter efficiency is taken from the database factor for the selected inverter, and shade is taken from the Solmetric SunEye readings that are used in the design process.