May 18, 2016   Posted by: Wouter Vermeersch

The Price of Solar – Benchmarking PV Module Manufacturing Cost

The Price of Solar• 2012 – 2015: costs decreased with 33 – 47%
• 2015: China 22% cheaper than Europe
• 2019: production cost 0,38 – 0,49 $/Wp

Research company IHS has been engaged by the Solar Alliance for Europe (SAFE) to review PV manufacturing cost differences globally. Focus of the study is on Tier 1 solar panel producers by region from 2012 to 2015.

The study comes to the conclusion that, since 2012, solar manufacturing costs have declined at high rates (33 to 47%) across all regions. In 2015, Tier 1 manufacturers with manufacturing facilities located in Europe, Japan and USA, produced PV panels at 0,60 $/Wp. During the same time period, producers in China were 22% cheaper (0,47 $/Wp) and producers in Singapore and Malaysia were 10% cheaper (0,54 $/Wp).

IHS identified the following key drivers of Chinese cost leadership: economies of scale, proximity to low cost material suppliers and big focus on standard panels.

The PV market will continue to grow in the foreseeable future, with Asia and China in particular as the largest regional markets. Given the historic learning rate, manufacturing costs of solar panels are expected to reach in 2019 a range of 0,38 $/Wp (Chinese Tier 1) to 0,49 $/Wp (rest of world Tier 1).

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