The global solar module industry is undergoing significant changes that are reshaping the market landscape for solar energy. Over the next six months, the industry is expected to achieve a more sustainable equilibrium, driven by waves of consolidation and notable price adjustments. According to recent analyses by industry experts, including Yana Hryshko from Wood Mackenzie, these trends will have a profound impact on manufacturers, buyers, and the technologies shaping the photovoltaic (PV) supply chain.
Why Are Solar Module Prices Expected to Rise?
One of the primary factors driving the increase in solar module prices is mounting market pressure due to an imbalance between supply and demand. While global production capacity remains high, particularly in China, self-regulatory measures imposed by the Chinese government have led Tier 1 manufacturers to limit their output. This move aims to stabilize the market and prevent oversupply, which could harm the industry.
Additionally, many Tier 2 and Tier 3 manufacturers relying on outdated technologies like PERC (Passivated Emitter and Rear Cell) and low-efficiency TOPCon are facing serious financial challenges. Many of these companies are no longer competitive and are likely to exit the market, either through bankruptcy or by pivoting operations to other sectors. This reduction in overall production capacity will create artificial shortages, potentially pushing module prices higher.
Technology and Industry Consolidation: China’s Role
China, as the dominant player in the global PV industry, plays a pivotal role in shaping its future direction. New guidelines introduced by the Chinese government emphasize efficiency and technological innovation, favoring large manufacturers adopting modern technologies such as heterojunction (HJT) and back-contact. Manufacturers using outdated technologies are no longer permitted to expand their capacities, accelerating the transition to newer technologies.
This shift is happening much faster than anticipated. For instance, PERC technology is expected to be phased out entirely by the end of 2025, while investments in TOPCon technology are also declining. Instead, the focus has shifted to HJT and back-contact technologies, which promise higher efficiency and lower production costs in the long run.
Solar Module Price Forecasts
With these changes, Tier 1 high-quality solar module prices are projected to rise to between $0.14/W and $0.15/W by the end of this year. This increase reflects manufacturers’ efforts to close the gap between market prices and their production costs. For buyers, this means the era of cheap modules may come to an end, at least temporarily.
However, lower-quality modules will still exist in the market for some time. Nevertheless, as demand for advanced technologies grows, these older modules may gradually disappear. At the same time, producers of cells, wafers, and polysilicon, who previously incurred
significant losses, are now looking to recover. As a result, upward pressure on prices is inevitable.
Long-Term Implications
In the long term, the PV industry may return to more stable pricing levels, similar to those seen before the Covid-19 pandemic. High-quality solar module prices are expected to range between $0.12/W and $0.15/W by the end of 2025, depending on the technology used. This reflects a new balance between global demand and more rationalized production capacities.
For customers and investors, this is an exciting yet challenging time. While module prices may rise, more advanced and efficient technologies will offer better value in the long run. For manufacturers, focusing on innovation and efficiency is key to staying relevant in an increasingly competitive market.
Conclusion
The changes occurring in the global solar module industry signal that the market is maturing. With ongoing consolidation, anticipated price increases, and a shift toward new technologies, the industry is moving toward greater sustainability. For all stakeholders—whether manufacturers, buyers, or investors—it is crucial to understand these dynamics and adapt their strategies for success in this new era of solar energy.
The global PV industry is not only becoming more efficient but also more innovation-driven. This is a positive step forward that will benefit the entire clean energy ecosystem worldwide.
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