Lux Research’s latest report, “Traversing the Road to Higher Crystalline Silicon Efficiencies: Who Stands to Change the Game, and How it Will Play Out,” has set the claim that as competition increases, subsidies fall and silicon prices diminish, high-efficiency crystalline silicon modules will dominate the market hitting US$8.6 billion in 2015.
Crystalline silicon (x-Si) cell and module manufacturers are in an eternally competitive cycle, which, according to Lux, has seen tier-1 companies develop higher efficiency solar panels with emerging technologies featuring selective emitter, heterojunction with intrinsic thin layer (HIT) and buried contact technology to stay on top of the competition.
“Traditionally, x-Si cell and module producers such as SunPower and Sanyo could command a higher price for more efficient panels,” said Pallavi Madakasira, a Lux analyst and lead author of the report. “But the threat from low-cost Chinese manufacturers has forced such players to keep increasing the efficiency of their panels just to compete on cost – without earning a price premium.”
The report points out that PV systems are primarily comprised of glass, aluminum and copper and the prices of these materials do not necessarily see a drastic drop at higher volumes. However, as higher efficiency panels produce more power, they tend to drop the cost of the materials on a per watt basis, leading Lux to conclude that a 1% improvement in absolute efficiency leads to a US$0.05 to US$0.08 savings her peak watt.
Lux’s report pointed to three other contributing factors, which will directly affect how higher efficiency products perform. Economically speaking, Lux asserts that while the residential and commercial sectors will not be as easily persuaded to pay the high upfront costs for high-efficiency modules, utility-sized applications will be more readily able to integrate the modules since they usually have more funds available and need projects with a long-term guarantee.
Lux also notes that new technology and R&D spending among equipment suppliers will be a contributing factor. As more projects look to the use of high-efficiency technology, equipment suppliers are going back to materials consumed and associated costs and technologies pursued. Finally, the continued collaboration between research labs and universities has seen more tier 1 manufacturers look to research labs, and their personnel, to bring the inside knowledge of the proprietary technology internally.
Further information on the report from Lux Research can be found here.