The Cost of Solar Panels - High But Likely To Fall
The Cost of Solar Panels is expected to continue to drop!
If you are on at the planning stage of installing solar panels in your homes, a basic understanding of the cost of solar panels installation and the benefit derived from it will help your decision.
Solar panel cost have recently been very high due to shortage of the basic element, which is silicon, but reports and researches have assured that these problems are being dealt with and will be solved within three years, i.e. by 2012. So cheaper solar panels should find their way to the markets within is couple of years.
A study was conducted by the president of the Institute, Travis Bradford, saying that cost of traditional silicon based solar panels will fall from the current $3.66 per watt to $2.14 per watt already in 2010. Thin film PV will go from $2.96 to $1.81. The cost of coal, being the least expensive generators of power is approximately around $2.10 to generate power per watt; the cost of solar panels is expected to drop far more.
This news that the cost of solar panels is likely to fall so that the panels become mre affordable is encouraging and means that more individuals will be able to install them in their homes and businesses for both the purpose of offsetting their electricity consumption and having them for profit gain. Other highlights of the report include that the number of companies with silicon-producing facilities is increasing.
The recent global production for thin-film panels and silicon is approximately around 3.14 gigawatts and it is expected to strike 12.36 gigawatts in 2010, posing an increase of almost 400%, an extraordinary large amount that is certainly be welcomed by the community and hopefully will cause the prices to drop down.
The main reason for this likely drop in silicon prices is the expected increase in silicon production. The availability of silicon is projected to increase four-fold to 125,302 tons in the next 3 years, providing an oversupply of this silicon material in the industry.
Manufacturers of thin film solar cell that are not utilizing silicon as their main component shall not be affected with this overabundance, nevertheless, they will have to compete with the decreasing prices of solar panels.
This will maybe lead in pushing the governments to begin offering incentives to those installing solar and will be supporting the manufacturers, adding employment of thousands of people.
According to the latest survey conducted by the Nexus Energy, a typical home can consume approximately 9,000kWH of power per year. Assuming the after a year, a final bill reflects a total energy reduction of 20% from the previous year.
This constitutes by installing a 7.8 kilowatt solar panel array explaining for efficiency losses. Solar panel system will cost at an estimated price of $43,000. This simply implies that the 20% reduction in power consumption will generate a savings of 25% in the system cost or about $14,000.