PV Prices Rising

According to market reports, the industry has also grappled with persistent polysilicon shortages, causing the average selling price of solar cells and PV modules to rise in recent years, including during the first quarter of 2008. “Modules are 50%–60% of the cost of the entire system,” said Strong, who predicts that “you won’t see cheap PV modules in the near term.” Strong noted that less expensive technologies, such as thin-film solar cells, are unlikely to lower prices for customers, because an oversubscribed market provides little incentive for manufacturers to keep their prices down.

Especially for commercial electricity customers, power-purchase agreements—in which companies pay the upfront costs of solar-power projects in exchange for a contract requiring the customer to buy the resulting electricity (see