What made solar panels so cheap?

December 12, 2018  

Cost of solar panel is decreased dramatically over these decades. Earlier, solar panels work far too expensive to be in the Global market. Solar panels were only used in satellites and space stations. Price of solar panels have been decreased to such an extent that it is now available in 6 cents per kilowatt in some cases when we calculate subsidies and other incentives.

Between 1998 and 2009 the cost of solar panels dropped by 30% and since 2010 the cost of solar dropped further by 70%.

Nowadays solar farm is lot more cheaper than coal burning plants. There are various reasons that contribute to decreasing prices of solar panels.

1. Technology got cheaper

Solar photovoltaic modules and now available at cheaper rates than even before. This made the solar panels cheaper than 1 dollar per watt.

2. Lower manufacturing cost

New manufacturing techniques have played a major role in lowering manufacturing cost. Over since past 20 years the development of more compact and efficient solar panels design have been seen. Solar power plants cost more than the price now because of equipment needed and also they have to cover construction cost and financing cost.

3. Tech Race

Solar panels are made up of silicon. Earlier Silicon was not cheap and abundant than present. Silicon is also used in mobile phones, cell phones and other electronics and thus silicon is now available in abundant form and more amount of it is harvested.

4. Funding sources now trust solar power

Investors and banks are very picky when they are going to lend some money. For bank you need a good credit score, etc. and investors will help their terms and conditions but still they wants trust you until your industry seems to yield profit.

Nowadays solar is trusted by lots of people that the cost of energy have been decreased and interest rates have been dropped.

5. Scale makes it cheaper

A solar farm would get the solar panels in much decrease the rate as they are ordering them in bulk. The per kilowatt price of solar farm is less but that of solar module does not change.

Future

The prices of solar power will continue to fall 4.4% per year to 2022 and also text credit is said to be 26% by 2020 and it will be eliminated by 2022 for residential solar installments.
(Prediction by "power scout", a California-based startup)