The Solar Industry has spent decades lowering the cost of solar-powered electricity generation. The company is now concentrating on making panels even more powerful. With savings in equipment production plateauing and more recently challenged by growing raw material prices, manufacturers focus more on technological advancements, such as better components and more sophisticated designs to generate more power from the same-sized solar farms.
Xiaojing Sun, global solar research leader at Wood Mackenzie Ltd, said, “The first 20 years in the 21st century saw huge reductions in module prices, but the speed of the reduction started to level off noticeably in the past two years. Fortunately, new technologies will create further cost-of-electricity reductions.”
A push for more powerful solar technology emphasizes the importance of future cost reductions in moving away from fossil fuels. While grid-scale solar farms are already often less expensive than even the most advanced coal or gas-fired plants, more savings will be necessary to combine clean energy sources with the costly storage technology required for 24/7 carbon-free power.
More giant factories, automation, and more efficient production processes have resulted in economies of scale, lower labor costs, and less material waste for the Solar Industry. As a result, between 2010 and 2020, the average price of a solar panel reduced by 90%. As a result, developers can produce the same amount of electricity from a minor operation by increasing power generation per panel. This is important because land, construction, engineering, and other equipment costs have not declined in lockstep with panel prices.
Paying a premium for more modern technologies may even make sense. Higher-capacity systems are already on their way. For example, most solar panels produced a maximum of roughly 400 watts of electricity during much of the previous decade. Companies began offering 500-watt commissions in early 2020, while Risen Energy Co. of China released a 700-watt model in June.