This picture illustrates the dramatic fall of solar photovoltaic prices in the last 35 years. Around the time when I was born, 34 years ago, a 3kW system for a home would have cost about £79,000. Today the same system costs around £6,000 including inverter, cables and installation.
price of photovoltaic modules in USD/kW [source: Bloomberg New Energy]
This is an amazing feat. The future of these prices is uncertain for the next years since many geo-political factors are at play. The global crisis, the cheaper modules that China is producing, Americans and Europeans taxing imports in a potential trade war, and many companies going bankrupt are some of the obvious factors. Most forecasts predict lower prices for 2013 but the following years are an open question.
Learn more:
1. the science of solar panels
2. Solar PV ABC’s
* using the ration between $45/W (~1978) to $0.9/W (~2012)
By Srikanth Narayanan June 7, 2013 - 5:43 am
It is really amazing that solar price has fallen down 100 times in the last 30 years. I we look at the factors I think it is mainly due to the advancement in electronics and price to produce. I also think it cannot be 1 to 1 comparison to car as the price is more driven by the cost of steel. I can say on average a auto manufacturer cost to build is 35 to 40 % o the sales cost. The cost when it reaches the consumer is the factors in between and taxes around 22%. So I think unless there is a radical change in the auto industry raw materials I don’t see the price going down like solar panels. Thanks to the inventors of the electronics industry who made it possible. Now it’s our duty to promote it.
By Alvaro June 14, 2013 - 7:48 am
Hi Srikanth, Good point. I think the comparison with cars was just supposed to show how dramatic the cost reduction was. But obviously taxes, raw materials and other factors make such a price reduction impossible for cars. Perhaps projects like wikispeed (open source manufacturing of cars) will eventually drive the prices down there too.