In a recent research note from the Intersolar North America trade show, Deutsche Bank Research Analyst Vishal Shah predicts a combination of rising capacity from Chinese suppliers, coupled with a slow-down of U.S. demand.
Shah states that most tier 1 and tier 2 Chinese PV module suppliers are adding an average of 500 MW of incremental annual module capacity in Southeast Asia in order to avoid paying tariffs on U.S. modules, and notes that Talesun alone brought on 800 MW alone in June in Thailand. The result will be at least 4-5 GW of new tariff-free capacity to supply the U.S. market in the second half of 2016.
This capacity will not be coming online at an opportune time. Shah notes that Deutsche Bank previously expected 15 GW to be installed over the course of 2016, but as only 4 GW was installed in the first half of the year, the overall volume could be only 10-12 GW. Over the next few years the picture improves, and Shah notes increased project development activity in the U.S. South and Midwest.
Regardless, the result of these two trends increased supply and reduced demand is crushed prices. Shah estimates that monocrystalline silicon module prices in the United States are currently at $0.53 per watt in the United States, but expects module prices to end the year at less than $0.50 per watt.
In terms of overall project costs, Shah says that solar power contracts in the United States are currently being offered at less than $0.05 per kilowatt-hour, with prices under $0.04 in North Carolina for contracts to supply power in late 2017. He also says that while fully installed costs are around $1.10-1.25 per watt for utility-scale solar, that leading European installers expect installed costs in the $0.80-0.85 per watt range over the next 12018 months.
This article originally appeared on the pv magazine USA site.
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: editors@pv-magazine.com.
4 comments
By submitting this form you agree to pv magazine using your data for the purposes of publishing your comment.
Your personal data will only be disclosed or otherwise transmitted to third parties for the purposes of spam filtering or if this is necessary for technical maintenance of the website. Any other transfer to third parties will not take place unless this is justified on the basis of applicable data protection regulations or if pv magazine is legally obliged to do so.
You may revoke this consent at any time with effect for the future, in which case your personal data will be deleted immediately. Otherwise, your data will be deleted if pv magazine has processed your request or the purpose of data storage is fulfilled.
Further information on data privacy can be found in our Data Protection Policy.