- Stakeholders estimate that solar panel costs will remain high till next year.
- Prices have risen due to the costs of input materials for solar components.
- Manufacturers do not expect costs to fall until Q2 next year.
Manufacturers believe that the price of solar panels, which have been rising since last year, will likely continue to climb until next year due to the high input, freight costs and supply chain issues in China. In addition, the price of polysilicon (the main raw material used to make solar panels) has increased by 343 per cent since 2020 and 148 per cent since January. As a result, solar module prices have risen by as much as 35 per cent since last year, constraining the development of several solar projects across teh globe.
Another factor contributing to the increase in price has been the surge in the price of other materials used to make solar components. Copper, silver and aluminium prices which account for 5-10 per cent of the overall cost for solar projects, have also risen. The price of solar glass has also risen by about 130 per cent since last year.
Industry stakeholders believe that bringing down the prices would require the expansion of manufacturing capacity in China. This, however, will not happen till late 2022. Manufacturers estimate that there will be a decline in polysilicon prices around Q2 2022 following the completion of capacity expansion projects.