A major new study that combines research from two of the most pre-eminent institutions in the US – the National Renewable Energy Laboratory and the Lawrence Berkeley National Laboratory – has highlighted the dramatic falls in the price of solar modules in the last 12 months and three years, and the expected continued price fall in the coming 18 months.
The study, put together by lead authors David Feldman (NREL) and Galen Barbose (LBNL) focuses on recent pricing trends and near term forecasts for solar PV.
The first graph models the progress of the overnight capital cost of solar PV systems over the last four years. They have consistently been ahead of analyst forecasts, and have fallen by between 14 per cent and 18 per cent a year.
The authors say between half and three quarters of this reduction is attributable to the module price. Just in the last 12 month, the overnight capital cost of systems fell by between 13 and 23 per cent.
The next graph highlights the reduced costs at scale. The authors found that the median installed price for the largest commercial systems is 38 per cent lower than the smallest residential scale. Economies of scale are more pronounced at the small end of the size spectrum. However, there was a 22-26 per cent reduction in costs from 5MW to 185MW.
The next graph shows that the range of analyst expectations. Since 2009, the cost of the actual module has fallen 35 per cent a year, and while further dramatic falls are not expected in 2013 and 2014, a further fall in module prices is still expected. “Major system price reductions are not expected to come from PV module price alone, as was the case in previous years,” the authors write.
The last graph presents the forecasts in a different format, and in the “system price” rather than just the module price. According to the authors, the cost of distributed solar PV systems is expected to reach between $2/W – $4.75/W by 2014, and the cost of utility-scale systems is expected to reach between $1.50 – $3.15/W by 2014.
More graphs can be found in their presentation.
