Declining Cost Trends In Solar PV May Change The Market Dynamics

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Understanding the declining trend in solar PV costs is critical to decide when to install a PV plant and how much we should quote for the sale of solar electricity to state utilities. The solar PV cost is declining by over 20% per year. If we look at the EY report which forecasts the solar PV panel prices will be @ 1 $/Wp in 2013, however the reality is that most of the solar PV manufacturers are already selling the PV modules  bellow 1 $/Wp price. The falling prices of solar modules can make solar PV price much more competitive at an early stage, than predicted by the market experts. However it is important to remember that module prices are contributing only 50% of the total project cost and the BoS price trends are yet to be analysed. As per our estimates the BoS prices have also declined by almost 20% every year. Some of the leading inverter manufacturers such as German based inverter manufacturing company AEG have already started their production facilities in India. It seems that grid parity for solar PV is not far away.

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