Further Price Cuts in Home Solar Panels Not Expected

Supplies for polysilicon used for manufacturing solar panels have stabilized and prices are not expected to decline further. The material, used in crystalline silicon PV cells was in oversupply in 2013 and some suppliers of polysilicon were forced to shutter their doors. Production was at a maximum which lead to this surplus. With demand and supply relatively steady, prices have now stabilized.

According to PV Magazine prices crashed between 2011 and 2013 when the global polysilicGreentech Media, the solar industry dominates global polysilicon consumption which has led to greater market demand. A monopoly on the production is still a factor with “the top five vendors – GCL, Wacker, Hemlock, OCI and REC – comprised 81% of total worldwide polysilicon production.” With the rebound in pricing so far in 2014 there is hope for market growth and additional production facilities to come online.

PV Magazine is skeptical because increased production and capacity “could create an oversupply situation again in 2016.” There is a prediction that thousands of metric tons of annual polysilicon production capacity will arise bringing “global polysilicon capacity to 437,000 metric tons” by 2016. This is enough to produce about 85 GW of crystalline silicon PV modules.

PV-Tech reports that they expect to see average use of silicon PV wafers to decrease from 5.3 grams per watt to 4.7 grams per watt by the year 2018. Although this would cause silicon costs of cents per watt to decrease, overall “polysilicon remains the single largest cost to PV module production.” New additions to the market will lead to a more complex and competitive market which will be a positive step in polysilicon production for solar PV modules.