After 18 months of continuous severe price reductions in the solar market, it looks to us as if solar panel prices in the UK may well have started rebounding from their recently low prices.
We've just been checking our suppliers prices and have noticed prices from most of the major suppliers seem to have started going up a little in the last month, as shown below.
Canadian Solar up 2-4%
Panasonic HIT up 4%
Yingli Panda up 2%
UpSolar up 4%
What factors might cause a rise in panel prices in 2013?
We don't know if this is down to currency fluctuations or the manufacturers starting to put their prices back up as the oversupply situation in the global marketplace eventually sorts itself out following last years rapid succession of bankruptcies and companies pulling out of the solar market.
Tracking data from PVinsights.co.uk last week shows across the board increases in the weekly spot price for all silicon, wafers and cells, with a 5.3% jump in the price for 2nd grade poly silicon, which is used in the panels at the cheapest end of the market. [23/01/13 update] Since I wrote this article there has been a second weekly across the board increase in silicon pricing including a 4.75% rise in 2nd grade poly silicon, so that's a 10% rise in the spot price for the cheapest silicon in a fortnight.
Whether these price rises will continue from now or this is just a temporary blip, it's virtually inevitable that prices will rise to some extent this year as most solar manufacturers have been selling panels at a loss for most of last year just to keep their factories in business due to the huge oversupply situation that developed around the end of 2011.
With several GWp per year of production capacity now lost to the market, due to bankruptcies or firms pulling out of the solar market including European, American and many smaller chinese manufacturers, as well as significant growth in several key global markets, if the over supply situation isn't over yet, then it probably will be at some point this year. When this over supply situation ends, then solar panel prices will inevitably creep up as manufacturers seek to regain their profit margins if they can do this without losing significant market share... which they'll be able to do if everyone else is also putting their prices up.
Now is the best time to buy solar PV.
We're often asked when the best time to buy solar PV is, and until now the honest answer would have usually been a couple of months before any Feed In Tariff cut. If solar panels prices are starting to rise though, then that changes things significantly, meaning that now is likely to be the best time to have a solar PV system installed as prices are currently rock bottom and are more likely to go up than down between now and the next Feed In Tariff cut.
Following the energy price rises of last Autumn, and the rapid reduction in solar prices throughout last year, the rates of return on offer now for relatively high energy users easily match the rates of return available at the peak of the boom in November 2011, as the price and performance guide below for our cheapest Value systems shows.
All Black High Spec | Hyundai 250Wp mono + Power-One inverter
|System size||Price||Annual generation||Annual income||Annual ROI||20 year profit|
|2 kWp||£4,595||1,760 kWh||£438||7.4%||£6,789|
|3 kWp||£5,695||2,690 kWh||£650||9.8%||£11,197|
|4 kWp||£6,595||3,590 kWh||£842||11.4%||£15,060|
ROI shown is for a best case scenario unshaded south facing roof with higher than average daytime electricity consumption (50%, 45%, and 40% on site consumption for S, M, L installations), combining FIT, export payments and offset energy savings, and is calculated based on the IRR method, so is based on the cash profit relative to the original installation cost, with an inverter replacement allowance for year 15. Income and savings are tax free for private household installations.
Order now before our prices start to rise
Leeds Solar are currently operating on around a 2 week lead time for installations, and expect to hold our installation prices at these levels for a few weeks at least, unless panel prices rise further in that time.
We'd strongly advise anyone who's been waiting for the best time to buy a solar PV system to get in touch now before our installed prices actually start to rise in line with panel prices.