The World's #1 Renewable Energy Network for News, Information, and Companies.
Untitled Document

Solar Companies Getting Beaten Up by Falling Prices

Many public solar companies will soon be reporting their second-quarter earnings, and they will likely have some painful stories to tell.

Gross margins of solar panel makers slid 25 percent in the first half of this year, and the average price of silicon solar panels dropped from about $1.80 per watt in the first quarter to below $1.40 per watt currently, according to an IMS Research report on Tuesday.

Manufacturers have cut their solar panel pricing by around 15 percent in the last six weeks. The prices are falling at a faster clip than the manufacturing costs, however, IMS said.

Norway-based Renewable Energy Corp (REC) on Tuesday reported a net loss of 6.7 billion kroner ($1.2 billion) for the second quarter. A year ago, it posted a net income of 757 million kroner ($137.8 million). Average selling prices of its wafers and panels fell 21 percent and 14 percent respectively. Even back in May, the company announced it would cut the production of silicon wafers, cell and panel and lay off about 500 employees, though the company said the layoffs might be temporary.

Prices began to fall quickly for manufacturers during the first quarter when key European markets, such as Italy and France, couldn’t settle on how much cuts they wanted to make to their subsidized solar electric rates, otherwise known as feed-in tariffs. Plus, manufactures were planning for some serious production expansions last year when the market was hot.

Cuts in subsidies typically force manufacturers to lower their prices. Policy uncertainties – coupled with what is traditionally a low season – caused a pileup of inventories in the first three months of the year. First Solar and SunPower both reported uninspiring sales and profit.

The market couldn’t absorb the bumper crop of solar gear quick enough in the second quarter. All hopes are pinned on the second half of this year. Volatility happens in every market, of course, and solar’s is particularly affected by government policies because it’s ultimately trying to replace power from coal and natural gas. To do that, solar electricity will have to be cheaper, and at this point, it can’t get cheaper without government incentives. But many solar incentives, whether they are in Europe or the United States, are subject to political whims and frequent revisions.

Solar companies have always known that they can’t rely on Europe forever as their best market. The issues are when to start seeking new markets in earnest and how many resources to put into that effort. First Solar executives have talked quite a bit about exploring new markets in the last nine months. India, in particular, is getting a lot of attention. Companies from giants such as First Solar and Suntech Power to startups such as Abound Solar have signed some sort of agreement to sell their panels to Indian customers.  

On Monday, the Export-Import Bank of the United States announced it would provide a $9.2 million loan to Punj Lloyd Solar Power in India to build a 5-MW project using Abound’s solar panels. On the same day, the bank also said it had approved a $16 million loan to Azure Power Rajasthan in India to build a 5-MW project using First Solar’s panels.

The volatility of the solar market and the hefty costs required to bring a technology to market might explain why First Solar’s chairman and former CEO, Michael Ahearn, told Dow Jones that he won’t be looking for any solar investment with his newly launched, private $300 million fund. 

Untitled Document

Get All the Renewable Energy World News Delivered to Your Inbox

Subscribe to Renewable Energy World or email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


Solar water heating

California Regulators Propose Expansion of Eligibility Requirements for Solar Water Heating Program

Jennifer Delony The California Public Utilities Commission has proposed expanding the eligibility requirements for customers seeking ...

Florida Supreme Court Takes Up Solar Question

Wayne Barber Because Florida remains one of only four states where current laws expressly deny citizens and businesses the freedom...
solar net metering

Lithuanian Net Metering Hits Snag from Outset

Linas Jegelevicius The much anticipated net metering in Lithuania has hit a major snag from the very start – the introduced network oper...
Solar energy

Colorado PUC Orders No Changes to Solar Net Metering

Vince Font In what is being lauded as a “fair outcome” for consumers, utilities and the solar industry alike, the Colorado Publi...


Canadian Solar Wins Five Solar Power Projects Totaling 185 MW in Brazil

These power projects were won under a 20-year Power Purchase Agreement (PPA) with the B...

$100 Off of 5-day Advanced PV Project Experience. Download a Topic Schedule.

Assemble, ground, energize, and commission a complete grid-tied SolarEdge system from s...

Intersolar AWARD „Solar Projects in India“ – Applications being accepted until September 18

The Intersolar AWARD in the category Solar Projects in India honors projects in the fie...

National Thought Leaders to Present on Today's Clean Energy Issues & Trends During IREC's 3iForum at Solar Power International

"An encore to the standing-room-only sessions the past two years, IREC again brings som...


Washington, DC Bridges the Solar Gap

The District of Columbia has enjoyed 15 years of strong economic growth. But prosperity is spread unevenly across the...

Sell Through Hypothesis

You first learned to hypothesize, or make educated guesses, in grade school science class. Now it’s time to ref...

Cronimet / THEnergy study: In solar for mines size does not always matter - Reducing CAPEX with energy efficiency and load shifting

Munich, September 2015. Mining companies are constantly gaining interest in solar solutions because frequently solar ...

Final Program Now Available for GRC Annual Meeting & GEA Geothermal Energy Expo

GRC Annual Meeting & GEA Geothermal Energy Expo - Final Program from


Ucilia Wang is a California-based freelance journalist who writes about renewable energy. She previously was the associate editor at Greentech Media and a staff writer covering the semiconductor industry at Red Herring. In addition to Renewable En...


Volume 18, Issue 4


To register for our free
e-Newsletters, subscribe today:


Tweet the Editors! @jennrunyon



Successfully Integrating Solar: A Proactive Approach

•      What does the increasing solar penetrati...

Solar Frontier Offsite Office at Solar Power International (2 mins....

Solar Frontier will be hosting an offsite meeting room offering our gues...

PV-Diesel Hybrid Systems to Reduce Diesel Demand

Substantial fuel cost saving potential has made PV technology the centre...


Sell Through Hypothesis

You first learned to hypothesize, or make educated guesses, in grade sch...

Vacancy? No Problem!

Have you ever tried to sell an efficiency product or service to a prospe...

Going The Extra Mile

Selling efficiency takes perseverance, creativity, and a willingness to ...


Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now