Expect Solar Prices to Bottom Out and Begin to Rise Very Soon

The reason that solar panel prices are so low is because the supply of panels have exceeded the demand. The supply was projected on the historical growth of solar which had been rising at a spectacular rate, but governments around the world have fallen into a recession mode and have trimmed or eliminated the supports for the solar industry. Examples here are the elimination of the 1603 grant and the rising need to reduce solar set-asides in the renewable energy credits in many of our states. It started with Spain, then Italy and then Germany. China has cut back on the manufacturing of panels and many of their businesses as well as those around the world have seen their profit margins disappear. The spot price of polysilicon had reached a low of $13 per kilogram; way below the manufacturing cost of roughly $20. The smaller cell manufacturers and the panel makers have been failing narrowing down the supply of panels. The results are beginning to show up with the spot price of polysilicon rising to $16 on the spot market. With the rise in polysilicon prices will come an increase in the cost of cells and finally the cost of panels. So, if you can afford to buy panels, now is a good time. So, unless we increase the demand substantially, the price will remain static or rising until the scale of manufacturing expands significantly.

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