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Solar News

Lower Silicon Prices...Again


Lower Silicon Prices Mean Lower PV Module Prices

And More News on Feed-In Tariffs  

July 29, 2009
By: Daniel Maysick

Good news continues to roll in about prices of silicon. Once again they continue to fall. Only this time they have fallen enough to lead many companies to renegotiate their supply contracts. A green tech media online article talks about the price reduction and the near spot market price of around $67 per kilogram being reached.

"Prices for silicon and the resulting wafers have fallen so fast that major solar panel makers could afford to sell their products at below $2 per watt and still "make a small profit. The price for long-term silicon contracts has fallen about 50 percent this year from a year ago and come close to the spot market price of $67 per kilogram, or about $0.50 per watt.

"Many solar wafer and cell makers who signed long-term contracts in 2007 and 2008 have either renegotiated or canceled their contracts. These companies inked those agreements when silicon fetched $300 per kilogram on the spot market and $150 per kilogram for long-term contracts."

As the price reductions in silicon continue to make their way through the market the prices of solar products will continue to fall.

"The spot market price for multicrystalline silicon wafers fell to $3.44 per piece this month, or $0.93 per watt, New Energy Finance said. For contracts that require deliver in 2009, the medium price has fallen to at least $5.89 per piece."

As prices for solar panels continue to fall and the acceptance of feed in tariffs grows across the country, now is the time to purchase that home solar system. Green Inc. blog on the New York Times web site wrote about the most recent implementations of the feed in tariff here in America.

"The policy, called a feed-in tariff, offers small-scale producers of solar energy long-term contracts (usually at above-market rates) for the electricity they sell. Last week, the Sacramento Municipal Utility District, which serves 1.4 million people, approved a feed-in tariff that allows homeowners with solar panels a chance to sign up for 10, 15 or 20 years of guaranteed payments. The policy will take effect next January. The city of Gainesville, Fla., adopted a feed-in tariff this spring, as did Vermont. Washington state also has such a policy, and Hawaii is currently considering one."

Security is provided with a feed in tariff. Consumers who sell their excess energy to utilities are protected from the continual rise in energy prices. The pay offs are greater over time.

Feed in tariffs have worked effectively in Germany and Spain leading those two countries to be the leaders in installed solar capacity. Each year the feed in tariffs are reduced. The incentive is to act now and reap the greater benefits.