Solar’s Temporary Price Spike
Solar Power's Decade of Falling Costs Is Thrown Into Reverse; The price of key raw material polysilicon has surged, and that could impact projects in India and the U.S.
Dan Murtaugh and Brian Eckhouse (with Rajesh Kumar Singh and Rachel Morison), May 23, 2021 (Bloomberg Green)
“A key selling point that made solar energy the fastest-growing power source in the world—rapidly decreasing costs—has hit a speed bump…Solar module prices have risen 18% since the start of the year after falling by 90% over the previous decade. The reversal, fueled by a quadrupling in the cost of the key raw material polysilicon, threatens to delay projects and slow uptake of solar power just as several major governments are finally throwing their weight behind it in an effort to slow climate change…Higher prices are affecting demand and may delay some large-scale projects…[and] might force state-owned power giants in China to push projects into next year…Global projects that haven’t signed price agreements with utilities that buy the power might get delayed unless the customer is willing to pay a higher rate for the electricity…
…[T]he timing couldn’t be worse...[because renewable energy finally has a champion in the White House and ambitious climate goals have been announced across Europe and Asia…[Polysilicon prices] have touched $25.88 a kilogram, from $6.19 less than a year ago…Prices for steel, aluminum, and copper are also up, as are freight charges…[but] any material that has the kind of growth that polysilicon has had will continue to have capacity injected into the system…The challenge is timing…” click here for more