If you’re considering the installation of solar panels for your home, you might find yourself wondering: “Are solar company module prices expected to drop significantly in 2024?” If you keep abreast of solar industry news, understanding this could be essential for your plans on when to secure a solar array for home use. In this blog, I’d like to shed some light on this topic.
According to a recent analysis by Exawatt, a UK-based solar manufacturing advisory firm, we’re unlikely to see significant drops in solar module pricing this year. Their findings might surprise you, given the global PV oversupply cycle and a price decline of over 40% that jolted the market in 2023.
As I dove deeper into the details, I learned that solar companies currently have substantial inventory levels. However, any further cost cuts might mean selling below cost, a situation that is far from sustainable for those in the industry. Alex Barrows, the head of PV for Exawatt, mentioned that further significant cost reductions from solar module manufacturers are improbable in the near term. The reason – materials and consumables make up around 80% of the PV module production cost.
Take polysilicon, for instance. This raw material is integral to the production of crystalline silicon modules. Its cost is very close to the production cost. With prices hovering around $7.5/kg for p-type ingot and wafer production, and $9 for n-type ingot and wafer production, there’s limited scope for further price drops. And, if manufacturers aim to avoid selling at a loss, prices will need to stabilize.
The expectation of market stabilization in the second quarter of 2024 also came from Rami Fedda, the co-founder of Solar Juice. He noted that the annual production shutdown in China for the Lunar New Year could extend to three to four weeks. This is considering the existing dynamics of oversupply in the market.
So, what does this mean for you if you’re in the market to buy solar modules? Well, be cautious. As module prices stabilize, there may be concerns about quality. Distressed manufacturers, under pressure to cut costs, may resort to using lesser quality materials – backsheets, encapsulants, junction boxes. As a potential buyer, heightened vigilance for quality is crucial during this time.
In conclusion, while module prices may not fall significantly this year, there’s a promising prospect of price stabilization. As individuals looking to join the solar revolution, we must strike a balance between cost and quality. Always remember, when it comes to securing solar panels for your home, a lower cost might not necessarily mean a better deal. Committing to sustainable solar solutions requires a careful evaluation of all factors involved. It’s always best to be well-informed and prepared. Stay tuned for more updates on the solar industry and how they impact you as an end-user. Until the next blog!
Original Articlehttps://pv-magazine-usa.com/2024/02/21/sustainable-module-prices-unlikely-to-fall-further/
