A Price Drop for Solar Panels

May 1, 2008 | Source: Technology Review

A shortage of the silicon used in solar panels is almost over, industry analysts predict. This could lead to a sharp drop in prices over the next couple of years, making solar electricity comparable to power from the grid.

Added silicon production capacity is now starting to begin operations. While only 15,000 tons of silicon were available for use in solar cells in 2005, by 2010, this number could grow to 123,000 tons. And that will allow existing and planned production of solar panels to ramp up, increasing supply and reducing prices.

Prices for solar panels could drop by as much as 50 percent from 2006 to 2010. In areas that get a lot of sun, that will translate to solar electricity costs of about 10 cents per kilowatt hour, matching the average price of electricity in the United States.