August solar prices fell at the quickest pace in the last eight years, according to the monthly survey by Solarbuzz.com. In Europe, prices reached another record low. And industrial electricity prices are finally poised to fall below 20 cents per kWh.
Price per Watt Dips Quickly
The price of a single solar module in Europe fell 2.2% (10 euro cents) to 4.34 euros per Watt. The August price was almost 8% below that of August 2008 and represents a new record low. And remember, this price survey is for single modules, so large orders would get lower prices.
In the US, prices fell 2.4% (11 cents) to $4.45 per Watt. The August price is now less than 3% above the record low set a few years ago. The price of solar electricity fell almost 2% to reach a new record low in all three categories:
Residential fell below 36 cents per kWh for the first time at 35.89 cents, commercial fell below 26 cents for the first time at 25.77 cents, and industrial slid to 20.07 cents per kWh.
The eight-year survey witnessed two new monthly records: number of lower prices for modules and the rate of decline (described above). A total of 176 modules had lower prices (12.7% of the survey) compared to the previous record of 126 (9.2%) in May of this year. The previous record change was an increase in prices at 142 modules in August 2005.
And Demand Poised to Grow
Solarbuzz also reported that more solar projects are moving again, a sign that demand should pick up quickly in the months ahead. Economic recovery, green governmental policy, and more attractive prices are the main drivers of this increase in demand.
Bottom line: While solar electricity prices remain higher than most conventional electricity markets, they are getting more and more competitive as the months roll by. September should be an exciting month as prices continue to decline and finally reach a record low in the US. Combining further solar price reductions with a return of tight oil market this winter should help the price of solar reach its most attractive point ever relative to other energy sources.
Onwards in the Sustainable Energy Transition-