Solar photovoltaic price free falling

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 dollar per kw

price of photovoltaic modules in USD/kW [source: Bloomberg New Energy]

The drop in price is so dramatic that it’s hard to imagine.  As a comparison consider a car today: a reasonable price would be £10,500. Now if the car industry applied the same cost reduction as the solar photovoltaic industry, a new car would cost £200 GBP 35 years later*.
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)
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