As Supplies Grow and Demand Falls, Solar Power Systems Become Cheaper

January 15, 2009

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The cost for rooftop solar systems, including installations, have declined 8 percent to 10 percent since October due to an oversupply of worldwide manufacturing capacity and lower demand. Prices for rooftop solar systems are expected to drop another 15 percent to 20 percent this year, USA Today reports.

New Energy projects an oversupply of nearly 4 gigawatts of solar modules in 2009, or enough electricity to supply 2.6 million homes. Adding to the supply, both Spain and Germany slashed its incentives for 2009, lowering demands for solar systems.

Barry Cinammon, CEO of Akeena Solar, told USA Today that the glut is already dragging down prices with wholesale prices falling 15 percent since October.

SunPower says it expects retail prices for its solar modules to drop as much as 20 percent this year.

For U.S. homeowners, prices for rooftop solar systems are expected to plunge by more than 50 percent after figuring in a bigger federal tax credit that took effect on Jan. 1.

Solar companies in Colorado recently said that solar panel installations have declined with the economy.

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Reader Comments

This is a myth! Just try to find a single solar system installer, leasing form, or PPA firm that will do a 2kw installation on an energy efficient home and provide a break even after utility incentives, rebates, and ITC of less than 20 years. There aren’t any. I have been conducting significant market research in this area contacting dozens and dozens of solar firms from the very largest down to mom&pop shops and not a single firm has budged on net install cost to the end user in the last six months. If anything after the extension of the ITC and removal of the cap prices have actually gone up. That is why I am working with members of congress to investigate the pricing policies for solar as large business installations are being done at almost one-half residential rates.

Jack Pouchet | January 16th, 2009

whilst the price of the panels might be coming down, you can rest assured the labor costs aren’t. These can sometimes be more than the system itself. Crazy!

facts about solar energy | January 19th, 2009