Observation and projection for solar markets
Here are a few high level observations about the solar market in recent years and some near term projections (in italics):Solar panel prices
50% drop in panel price led to a 200% increase in demand (with 1 yr time lag)
25% drop in panel price should lead to a 100% increase in demand the following year
12.5% drop in price should lead to a 50% increase in demand the following year
Installed prices
15% drop in price (2008-2009) led to a 50% increase in demand the following year—in the midst of the global credit crisis!
15% drop in price (2009-2010) led to a 100% increase in demand the following year—credit markets recover
Another 15% drop in price should lead to a 75% increase in demand the following year (averaging the two)
Mid 2008 5GW market @ $4W panel ($7.5W installed)
Mid 2009 7.5GW market @$2W ($6.5W installed)
Mid 2010 15GW market @$2W ($5.5W installed)
Mid 2011 20-25GW market @$1.75W ($4.5W installed)
Mid 2012 30-35GW market @ $1.5W ($3.8W installed)
Mid 2013 50-60GW market @$1.35W ($3.5W installed)
Mid2014 75-90GW market @$1.2W ($3W installed)
Sub $7 prices utilities order ~10MW plants
Sub $6 prices utilities order 50MW plants
Sub $5 prices utilities order 250MW plants
Sub $4 prices utilities order 1.25GW plants (?)
Somewhere around $3W installed, I believe solar market will become self sustaining.
I think the installed solar prices are a better metric than solar panel prices, since the installed price is ultimately the price the end user sees.
posted by Daniel @ 2:33 PM
2 Comments:
Hi Daniel,
Interesting analysis.
The solar installation price is already at $3/watt and below for high quality, high efficiency cSi panels, Suntech and others have already done it or have projects planned for that price.
If the solar market might be self sustaining at $3, what will it be like at $2 (in perhaps 3 years time) or maybe even $1 (in perhaps 10 years time)?
With total energy consumption at 17,000GW now, which is between 50,000GW and 85,000GW worth of solar PV, what size do you think the solar PV might get to (it is the least damaging, least risky and most easily installed of all of the clean energies? 10,000GW, 20,000GW?
What do you think?
Anon says "Suntech and others have already done it or have projects planned for that price"
I welcome your comment, but feel that $3/W installed (on average) may still be a few years off.
I've only seen one project being built in the US in the $3/W range. Are you talking about projects in Europe?
I've heard of cheap projects going in in China (it is possible that they would be profitable at that price in China) but I got the sense that some project bids were known to be unprofitable and only made for prestige.
Also I'm trying to throw out typical project prices, not "hero" prices. And I know First Solar comes in close to $3/Watt but they require more land than is typical b/c of the lower efficiency.
As for planned projects...I expect that most large projects now on the drawing boards are using some discounted forward pricing--it is no secret that prices are declining.
At $2/W installed, every watt of solar that can be produced will be installed! In fact, I believe that solar may never reach $1/watt installed, simply because people will be willing to pay more.
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