Solar price falls to new record low, industrial now below 20 cents per kWh

My first week working with the East Coast Greenway Alliance was amazing. And I have some big news to share that helps make my dream of a mobile bicycle/solar existence possible. Bicycles are already cost-effective, but solar has been out of reach to most consumers in the past. It's price just fell for the 11th straight month, reaching a new record low.

Below 20 cents per kWh for first time

The solarbuzz.com module price survey reported industrial solar prices dropped .9% for September to fall below 20 cents per kWh for the first time. It’s price is more than 7% below that of September 2008. With commercial and residential solar prices remaining just above 25 and 35 cents per kWh, respectively, solar remains more expensive than conventional electricity in most markets. But that may change within the next three years.

Price moves in US & Europe similar

Solar module retail prices reached a new record low in September, falling 1.4% (6 euro cents) to 4.28 euros per watt. This price has finally dropped below the record low back in 2003-04 of ~$4.33 when the dollar was stronger. Prices in the US also fell 6 cents (1.3%) to reach $4.39 per watt. 

Current Retail Price Drops Only the Beginning

The fall in retail prices of ~9% for a single module over the last year is only the beginning. On the wholesale side, solar modules are projected to fall as much as 50% this Fall from the third quarter of 2008. That leaves another 40% of retail price drops for the months ahead just to catch up. And wholesale module prices are projected by many to fall a good deal further over the next several months. One analyst recently projected the massive overcapacity of supply beyond recessionary demand should lower wholesale prices another 40% from today’s levels in 2010. This would translate into a module price below $1 per watt. He went further to predict prices per watt to approach 50 cents in 2011 — which would easily mean grid parity within two years if he were right and solar producers could do so profitably. The same analyst predicted that as many as half of the ~200 current solar producers will go bankrupt due to this massive price dive. 

Consumers & Installers Will Reap Benefits

These lower prices should translate into huge savings for consumers and solar installers in the years ahead. Lower prices will drive greater demand and help wean the solar industry off of current governmental incentives. While the profits of solar producers from First Solar to Solarworld to China Sunergy will be squeezed, the price drop will allow the Solar Age to emerge in the 2010s as solar chargers for our laptops, cell phones, and other aspects of our daily lives will become second nature.

Onwards in the sustainable energy transition-

Dennis