Solar PV system prices within the US are falling sooner than anticipated throughout all market segments, primarily pushed by module worth discount, in response to new analysis from Wood Mackenzie.
Residential system costs with mono PERC [Passivated Emitter and Rear Cell or Passivated Emitter and Rear Contact] modules at the moment are anticipated to fall 17% from 2020 to 2025, up from 14% forecast pre-coronavirus. Additionally, mono PERC industrial and utility system prices are anticipated to say no 16% and 20%, up from 13% and 16%, respectively, throughout the identical timeframe.
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“In the utility section, bifacial modules are gaining traction, particularly as these modules have been exempt from Section 201 tariffs on all imports into the US.
“Typically, utility-scale bifacial tracker tasks can be costlier than these with monofacial mono PERC modules as a result of elevated interrow spacing, leading to increased civil and land prices. However, bifacial techniques additionally yield system price advantages. These embody decreased stability of system elements and decrease labour prices due to the comparatively fewer modules wanted when in comparison with a monofacial system of the identical capability.
“In 2020, whereas bifacial modules are at the moment exempt from Section 201 tariffs, bifacial system prices are anticipated to take a seat at round 1% lower than monofacial mono PERC techniques.
“However, in a situation the place bifacial modules had been topic to Section 201 tariffs, system prices can be increased than monofacial mono PERC techniques,” mentioned Molly Cox, Wood Mackenzie Research Analyst.
As module costs signify a shrinking portion of whole system costs, Wood Mackenzie expects a heightened deal with gentle price discount from EPCs and builders. Soft prices, comparable to buyer acquisition within the residential market, have been an enormous barrier to declining system costs, together with allowing and inspection prices.
However, as prices are anticipated to say no at a slower tempo over the following decade, it is going to be essential to grasp the place the following stage of system price discount will happen.
“There are efforts beneath solution to deal with excessive allowing and inspection prices for residential PV techniques. The Solar Foundation and NREL have collaborated to type The Solar Automated Permit Processing platform (SolarAPP), which may yield financial savings for residential PV techniques,” added Cox.
Coronavirus impacts will have an effect on residential system costs extra so than some other market section in 2020, says Wood Mackenzie.
“Residential tasks have extra publicity to the affect of the coronavirus as a result of their shorter venture cycles.
“While there may be close to time period threat for worth will increase for bigger C&I and utility scale tasks, total 2020 system prices should not anticipated to be considerably impacted by the coronavirus in these segments.
“Module price discount would be the most vital issue impacting C&I and utility system prices because of the pandemic. Not solely are module producers going through decreased demand and subsequently reducing margins to remain aggressive, however they’re additionally taking a look at a discount in provide chain element prices, resulting in additional module worth declines,” mentioned Cox.
The Investment Tax Credit (ITC) discount to 26% in 2020 will create additional downward worth stress throughout all market segments, for each EPCs and builders, in response to the Wood Mackenzie report.
“The stepdown will trigger corporations to carefully analyze their price stacks and guarantee photo voltaic PV techniques are nonetheless aggressive with a four% ITC discount. Having mentioned that, corporations have been getting ready for the ITC stepdown, so we don’t anticipate any drastic modifications to system costs in 2020 in consequence,” continued Cox.
“As the photo voltaic trade faces demand destruction in 2020 from coronavirus affect, we anticipate demand to select again up once more by the top of the yr and earlier than the ITC steps down once more in 2021.
“As a consequence, corporations throughout all market segments could find a way…