US solar PV prices may fall by 50% within 5 years

The White House recently issued a report stating that the government stimulus subsidy program will help solar power prices fall by 50% in the next five years. The federal government’s US Recovery and Reinvestment Act (ARRA) will help solar power reach 2015 If there is a new technology breakthrough in the general price level, the solar power price may even be lower than the overall retail price in 2030.

Over the past one and a half years, the U.S. government has invested a billion U.S. dollars in heavy investment in solar energy R&D, manufacturing, and project development. After the market reasonably expects huge investment, it will see returns. JenStutsman, a spokesman for the Department of Energy, pointed out that apart from paying attention to the distribution of expenditures, the government also examined the impact of the entire stimulus package on future generations.

According to reports, the White House said that the revitalization of the economic fund will reduce the solar power prices of households. It is expected that in 2015, electricity prices will be reduced to 10 cents per kilowatt-hour (KWH) by 20 cents. If there is a breakthrough in technological innovation, the price of electricity can also be lowered to 6 cents in 2030, which is lower than the current electricity price. However, solar power is expected to drastically reduce prices, but it has caused a lot of discussion.

In fact, the report did not take into account the state and local government incentive programs, let alone free competition, market supply and demand and other market factors. Solar panel makers and upstream suppliers in 2009 took advantage of the cold winter weather and laid off staff or negotiated contract negotiations. As a result, product prices fell by as much as 50%. Even in the second half of 2009, due to the change in the German subsidy program, the industry boomed. A sudden turn, however, the competition for low prices from Asian manufacturers was fierce, and the prices of products only fell.

In addition, the government’s budget for renewable energy of US$6 billion has only US$2.5 billion in budget, which also has potential negative impact on solar energy development. The government has rashly stated that the solar power price will be lost within five years. The stimulus plan is the main promoter, which is too rash.