Letter Re: The Downward Trend for PV Panel Prices

I’ve had the impression for some time now that from all the so-called alternative energy sources, photovoltaic (PV) panels appeared to be the only one capable of really having an impact on traditional fossil fuels. Years ago the lowest prices you would see for solar panels were about $4 per watt. Not long ago a batch of new startups entered the marketplace producing thin-film solar cells, which could be manufactured with far fewer materials and some of these companies (Nanosolar) claimed their cell production cost less than $1 per watt, which was a symbolic price point that represented competitiveness with the price of coal-plant electricity. It was one of those things you’d wonder about, like claims of table-top cold fusion.

Ever since I heard about thin-film solar production I have tracked these companies and their progress toward retail production. I had previously checked the panel prices perhaps two years ago and the first thin-film solar panels were available at around $2.60 per watt.  Today I visited the same site and found a link to a vendor advertising $1.69 per watt panels, I thought that was a pretty good price and I clicked the link to see more, to my surprise the site was also selling panels for as low as $0.98 per watt.  These low-cost panels use a silicon-based thin-film technology, essentially the same silicon panel technology that has been around for decades but manufacturing improvements have reduced the amount of semiconductor-grade silicon to 1% of what it was previously.

They may have actually hit retail production at this price level (earlier than I expected to see it!). This is good news for many reasons but the big one is the stability/economic security this can deliver, the lower cost of energy will eventually lead to rapid economic growth, more food, fuel and everything. It will free us from our dependence on foreign oil by not only making electricity cheaper but reducing the cost of battery production and ushering in new transportation technologies. And at the very least, it means that 5 kilowatt solar array you were thinking of building on your house may be a fraction of the price right now, and it’s a good time to build it.

I expect the trend to continue, I don’t know how low it will go. I suspect that the competition in this industry is ferocious, there is a race on to be the next energy giant and a bunch of totally overhyped clean-energy startups with hundreds of millions in venture capital all trying to eat each other, and I wouldn’t be surprised to see $0.50 per watt panels in the next few years, panels may even be selling for less than the cost of production. – Jeff M.