Should Solar Be Monopolized?
While most solar panel producers have been experiencing overall growth and elevating interest from investors over the past few years, the solar industry is far from being immune to the current financial climate. It’s the same old story: oil prices rise, consumers and investors scramble for alternate sources of energy; oil prices fall, and industries like solar temporarily suffer. When the whole see-saw of solar power vs. fossil fuels gets pared down to this fine point, what we really need becomes clear: balance and stability.
As it stands presently the solar industry is sitting in the rafters, so to speak, building up newer and better technologies, acquiring new investors and gaining momentum in the public eye as a viable source of renewable energy – sometime in the future. Falling oil prices are affecting companies that produce solar cells and modules in that they’re having to lower their own prices and deal with oversupply, now that the mad rush for renewables is ebbing once again. One aspect of the solar industry, however, remains unscathed.
Wafer and silicon suppliers don’t have to bow to the shifting economy like other suppliers who are close to the customer end of things do, and therefore don’t suffer from price reductions and overstocked warehouses. And this could be just what solar needs to find a point of balance and stability. In fact, analysts are forecasting that the average selling price for solar energy systems will be forced downward by 20% this year, and yet there’s no reason for investors to panic or pull out. Instead, they’re encouraged to fund closer to the start of the solar production chain, where cash flow is more stable and supply and demand remain in an organized balance, rather than the cell and module end. Eventually silicon producers with low production costs will be the honey-catchers in the solar industry, causing the cost of solar for consumers to go down while retaining the interest of investors. The result? Consolidation of the industry, which will give it long term potential.
Already solar has begun to recover from last year’s dismal fourth quarter and banks are willingly granting credit lines for solar projects. Even China’s solar industry is looking brighter since the start of this year. Solar is an industry still in its infancy, but just like with almost every other new industry or practical technology, it’s just going to take some time to strike that healthy balance.
Cooler Planet is a leading solar resource for connecting consumers and commercial entities with local solar Installers. Cooler Planet’s solar energy resource page contains articles and tools such as our solar calculator to help with your solar project.
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