Solar PV module prices fell 50% in 2013, storage set to follow

Solar PV module prices in Australia were cut in half over the 2012-2013 period, falling from $1.50/Wp in 2012 to 0.75/Wp in 2013, according to the latest report from the Australian Photovoltaic Institute (APVI).

The report, PV in Australia 2013, also notes that installed prices for small-scale rooftop solar systems dropped by just under 20 per cent – from an average of around $3 to around $2.50/Wp – in a year that saw the largest market for PV installations in Australia since 2009.

“With PV having reached grid parity against retail electricity tariffs in many parts of Australia and government support reducing, the market is stabilising but remaining buoyant,” the report said.

APVI said that continued increases in grid electricity prices mean PV remained a cost effective option for homeowners across Australia, even without subsidies, and was of increasing interest to the commercial sector.

The report noted that over 1 million Australian homes now had a solar PV system installed, with residential penetration levels averaging 15 per cent nationwide, and over 30 per cent in some areas.

According to the report, the majority of installations in 2013 took advantage of incentives under the federal government’s Renewable Energy Target (RET) scheme, with further drivers provided by grants and finance assistance from the Australian Renewable Energy Agency and the Clean Energy Finance Corporation.

Australia’s largest PV market remains for rooftop systems on private residences, although the average system size has increased steadily over the past three years (see figure 1, below).

Commercial sector – grown more slowly than the residential sector to date – but interest in using PV to displace purchased power is increasing as electricity tariffs increase. Larger scale plants are being installed via the Australian Government Flagships program and the ACT Government’s Feed-In Tariff program.

The report also notes an increase in customer interest in on-site storage, for which, while “not yet cost effective for most customers,” it says a market is already developing.

“This trend could exacerbate issues faced by incumbent electricity sector businesses, even if it offers a means to manage supply intermittency and peak demand, since it would facilitate the installation of larger PV systems and may also see a trend to self-sufficiency, disconnection of customers from main grids and increased interest in mini-grids to service remote rural communities,” the report says.