Is the downward trend for solar panel prices losing momentum?

 

Open-Ed

The downward trend in module prices across the board could not be stopped this month, but it is clearly losing momentum. Manufacturers and dealers of solar modules are still reducing their prices, but only in small steps, and seek to slowly approach the price level accepted by the market. For a long time now, nothing has been earned from products at this price level.

In China too, it’s all about minimizing damage, because unsold stocks generate avoidable costs and the risk of progressive depreciation is always present. In order not to have to pay extra for transport costs, export quantities to Europe have been drastically reduced by Asian producers in recent weeks.

Interestingly, module prices on continents other than Europe and Asia are not as affected by the price decline. The price gap is sometimes drastically different – in the United States, it is up to 100% compared to the European prices for modules with comparatively low efficiency, which means with monocrystalline PERC cells.

However, products produced in China cannot easily be redirected to America because there are strict import restrictions there. This keeps prices there high and market volume low. We will be curious to see whether the US Inflation Reduction Act (IRA) really has the desired and needed impact on local PV production capacity. At least with the currently very high purchase and installation costs in the United States, it is rather unlikely.

Transferring this model to other markets is risky, although some non-Chinese manufacturers are already celebrating and shifting their sales focus and scope of operations to the United States. An industry cannot be kept alive permanently through subsidies, we should all have learned that by now.

Chinese photovoltaic manufacturers cannot endure a sustained period of low prices for long and are already trying to stabilize prices again through artificial shortages. If demand picks up again towards the end of the year due to the current price situation, the downward trend could soon be stopped. There is hardly a market participant who is happy with the current situation.

Overview of the price points differentiated by technology in October 2023, including the changes compared to the previous month (as of Oct. 15):

Author: Martin Schachinger

Martin studied electrical engineering and has been active in renewables for more than 20 years. In 2004, he set up pvXchange.com. The online platform allows wholesalers, installers, and service companies to purchase a range of components, including out-of-production PV modules and inverters.

This article was originally published in pv magazine and is republished with permission.

Disclaimer: The articles and videos expressed in this publication are those of the authors. They do not purport to reflect the opinions or views of Green Building Africa, pv magazine, our staff or our advertisers. The designations employed in this publication and the presentation of material therein do not imply the expression of any opinion whatsoever on the part Green Building Africa concerning the legal status of any country, area or territory or of its authorities.

1 Comment

Leave A Reply

About Author

Green Building Africa promotes the need for net carbon zero buildings and cities in Africa. We are fiercely independent and encourage outlying thinkers to contribute to the #netcarbonzero movement. Climate change is upon us and now is the time to react in a more diverse and broader approach to sustainability in the built environment. We challenge architects, property developers, urban planners, renewable energy professionals and green building specialists. We also challenge the funding houses and regulators and the role they play in facilitating investment into green projects. Lastly, we explore and investigate new technology and real-time data to speed up the journey in realising a net carbon zero environment for our children.

Receive the week’s most popular stories in your inbox every Saturday morning