The news from GTM Research that solar PV module price can vary by up to $0.16/watt by region is quite notable when you consider than solar PV modules are priced well below $1/watt. It’s also an indication that some solar PV module prices are artificially high, and therefore there is some reason to believe they could decrease.
Prices in the US for Tier 1 modules made in China were higher than in any other market. The price has been inflated by the trade tensions linked to modules produced in Taiwan and China. In the US, prices averaged about $0.72/watt in the fourth quarter of 2014, but for the same modules in Chile, the cost was only $0.56/watt.
(For the sake of clarity, Tier 1 PV module manufacturers are known to make the highest efficiency modules. They use the best grade of silicon and control every stage of manufacturing.)
“Regional price disparity grew in 2014, with the US ranking as the highest-priced market for Tier 1 Chinese manufacturers. It should be noted that though the US was the highest-priced market by the end of the year, it was also one of the lowest-margin markets for suppliers. This contrasts with 2013, when Japan and Europe were the highest-priced and highest-margin markets,” said GTM Research Solar Analyst and report author Jade Jones.
The trade tensions aren’t helping global trade, which could operate more fluidly and help lower solar PV module prices in the United States. “The US solar industry remains penalized by a trade policy that inflates the cost of solar power and has already expanded to include imports from Taiwan. We continue to urge the governments of the United States and China to negotiate an end to the trade war for the benefit of all countries involved,” explained Jigar Shah.
16 cents doesn’t sound like that much until you starting considering megawatts or gigawatts of new solar power installations that will be built in America. The solar power industry is in a fragile stage and needs reasonable accommodation to flourish.
Images by Yingli Solar