l'Actualité du Solaire

Panel prices unlikely to fall further

The price of panels cannot fall significantly in 2024 without manufacturers selling at a loss, according to Exawatt. This does not mean that stock levels will fall, as production capacity in China remains high.

This would explain why spot prices have stabilised. In the short term, oversupply could drive prices down further, but "sustainable" cost reductions in the medium term seem unlikely.

With materials and consumables accounting for around 80% of the cost of producing a panel, there is little room for price reductions. They will have to stabilise to avoid selling at a loss.

The price of silicon is close to the current production price: the price of silicon is $7.5/kg for type Pet $9/kg for type N. Average production costs are $6.5/kg, so there is little room for further reductions. Costs can still be reduced, but only slightly.

One speaker said that the price of silicon had risen for the first time in many months. This indicates the trend to come. He also said that panel prices would stabilise in the second quarter of 2024. Panel manufacturers could take advantage of the New Year holiday period to extend them for a while to reduce stocks.

Some manufacturers will be in difficulty, either because of their stocks or because of their production costs. They risk leaving the market. Before that happens, they will try to survive by reducing the quality of their components and therefore their panels.

https://www.pv-magazine.com/2024/02/20/sustainable-module-prices-unlikely-to-fall-further/

PV Magazine, 20 February 2023

Editor's note You should always be wary of calculations made on the advice of manufacturers. It is in their interest to justify the fact that price reductions are limited or impossible, and to make people believe that an increase is imperative. This is especially true in China, where we still don't have the company accounts for 2023 and no way of knowing what is really going on in the companies.

What casts doubt on this very narrow margin of possibility of a price decline is that all the producer announcements mentioned that the nice improvement in profits in 2023 came from the transfer of their production from P-type to N-type (cf Jinko Solar, etc.). As a result, there is an increase in the profit margin in the industry, and therefore room for a decline in prices. This improvement will be confirmed as soon as production of N-type panels reaches cruising speed, i.e. in 2024, and as soon as companies in difficulty lower their prices in order to survive.

There is also scope for prices to fall as obsolete production lines are shut down.

Finally, overproduction of panels will tend to depress prices.

All in all, there is still room for panel prices to fall in the first half of 2024.