Photo voltaic Panel Costs Down 30–40% In 2023, US Costs Down 15%


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One of many attention-grabbing notes within the lately revealed US Photo voltaic Market Perception report is that the common world photo voltaic module value within the third quarter of 2023 was down 30–40% from the common world photo voltaic module value within the 1st quarter of 2023. That is primarily as a consequence of provide–demand imbalances in China. The US market will get nearly no photo voltaic panels from China as a consequence of tariffs and the Uyghur Pressured Labor Prevention Act (UFLPA), with these Chinese language photo voltaic panels accounting for simply 0.1% of US photo voltaic module imports. Nonetheless, these world traits have had notable ripple results on US photo voltaic module costs, which had been down 15% in Q3 2023 in comparison with Q1 2023.

“Nevertheless, it’s necessary to acknowledge the variations in photo voltaic module provide dynamics between the US and the remainder of the world. Different world areas are at present in a state of module oversupply. As China continues its huge growth of producing capability throughout all the photo voltaic worth chain, there was important downward strain on world module pricing. The impacts of this oversupply scenario have escalated lately, with experiences of spot module costs outdoors of the US as little as 14-15 cents/watt,” the report states.

“Against this, the US market is considerably insulated from these pricing dynamics. Lower than 0.1% of US module imports this 12 months have come from China as a consequence of a mixture of tariffs (anti-dumping and countervailing duties [AD/CVD], Part 201, and Part 301). Virtually 80% of modules for the utility-scale market come from Southeast Asia. And whereas Southeast Asia is usually a low-cost area for module manufacturing, producers are nonetheless uncovered to the restrictions on polysilicon sourcing from China because of the Uyghur Pressured Labor Prevention Act (UFLPA).

“Consequently, module provide to the US utility-scale sector remains to be tighter than different world areas. Demand for modules from prime tier 1 producers is excessive. This has stored US module pricing considerably above value factors in different nations, even with out anticircumvention tariffs (for extra on photo voltaic element pricing, see Wooden Mackenzie’s PV Pulse). On stability, availability of modules for the US utility-scale market remains to be constrained however has improved considerably this 12 months. In fact, module availability will proceed to enhance as extra home manufacturing comes on-line.”

What’s stunning and a bit loopy is that the utility-scale solar energy market is having way more bother now getting different components. Photo voltaic module provides have began flowing fairly effectively, however the trade has to attend a very long time for different forms of electrical gear. The outcome, naturally, can also be rising costs. “Transformer availability has turn out to be a widespread downside, with wait instances extending previous 2 years in some circumstances. Excessive-voltage circuit breaker lead instances have almost doubled within the final 12 months to a mean of 100 weeks (see Wooden Mackenzie’s report H2 2023 US photo voltaic PV system pricing). This has already elevated stability of system (BOS) pricing for utility-scale photo voltaic. With no indicators of this pattern reversing, we count on electrical gear availability to be one among a number of components slowing utility-scale photo voltaic progress within the subsequent a number of years.”

If we break it down by sector (chart above), we see that residential solar energy system pricing was up 3%, business solar energy system pricing was down 2%, and utility-scale solar energy system pricing was up 5% (single-axis trackers) to six% (fixed-tilt methods).

Listed below are extra particulars on how the pricing for these totally different segments was break up out by element: “Module costs declined 12% for the residential and 6% for the business section year-over-year. The utility section continues to see elevated module pricing because of the one-year lag in module procurement mirrored in our pricing knowledge. For distributed photo voltaic, the decline in module prices has been offset by a rise within the stability of apparatus in addition to mushy prices. Throughout the 4 totally different market segments, labor and engineering prices have elevated wherever from 5-25%. Gear element prices have additionally been rising over the previous few quarters because of the rise in inflation. Nationwide PV system costs are up throughout all segments aside from the business section, which witnessed a drop of two% 12 months over 12 months.”

We’ll see what occurs in This fall and in 2024, nevertheless it’s clear there are a number of things influencing pricing, together with variations between the market segments. It’s onerous to know the way a lot will change within the coming months, because the financial and political conditions feels a bit up within the air and vulnerable to robust shifts within the traits. We will see.

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