Tuesday, December 23, 2008

Solar: Massive 168% photovoltaic module overcapacity to cause pricing collapse in 2009

From PV Tech:
The photovoltaics industry will become a victim of its own success in 2009, according to Dr. Henning Wicht, Senior Director and Principal Photovoltaics Analyst at iSuppli Corp. Eight consecutive years of growth coupled to low barriers to entry have resulted in a significant expansion in solar module production that will see supply exceed demand by 102% in 2008 and reach a massive 168% excess in 2009. Module revenues are expected to fall nearly 20 percent in 2009 to US$12.9 billion, compared to US$15.9 billion in module revenues expected in 2008.

“Supply and demand were already unbalanced in 2008 with 100 percent more modules produced than installed,” said Dr. Henning Wicht, Senior Director and Principal Analyst, photovoltaics for iSuppli. “The short-term boost in demand from Spain and Germany kept installation companies busy and solar orders and module prices high. But this boom is over. In 2009, average prices for panels for new installation contracts will collapse to the $2.50 to $2.75 per watt range by the end of 2009, down from the current level of $4.20 per watt. The average price for the year will be $3.10 per watt.”....MORE. solar module installations will reach 3.8GW in 2008 and rise to 4.2GW in 2009, a 9.6 percent rise.