A tumultuous year for solar and batteries
Module price madnessFalling prices for solar modules was the defining solar trend in 2024. In January, mainstream prices were approaching $0.15/W in an oversupplied market.
Energy price consultant OPIS reported below-production-cost $0.087/W prices for the latest tunnel oxide passivated contact (TOPCon) products in mid-November 2024, and further drops are still rumored.
While low pricing typically spurs demand, oversupply has been exacerbated by constraints on orders. With more efficient technology rapidly emerging, buyers fear being stranded with obsolete stock. Tariffs and other trade measures are locking imported products out of leading markets, particularly the United States and India.
The solar boom of recent years has ensured many nations need to laboriously upgrade their grids and slow progress has been exacerbated by a shortage of transformers and other equipment.
Consulting firm InfoLink has predicted a small annual rise in global solar demand in 2025, but has noted there could actually be a retreat.
Most observers expect PV oversupply to continue in 2025, with numerous bankruptcies among solar distributors and installers, while manufacturers are generally managing to hold on. However, while the biggest manufacturers are weathering the storm, InfoLink expects smaller, tier 2 and tier 3 producers to struggle in the short term and has predicted “large-scale scale production capacity exits” from the polysilicon segment in 2025.
The China Photovoltaic Industry Association urged its members in early November not to bid solar module prices below CNY 0.68 ($0.09)/W in tenders. Chinese manufacturers have told pv magazine they can get by at $0.12/W to $0.13/W.
Manufacturing goes globalAmid rising geopolitical tensions, many are realizing the perils of relying on a single region for the supply of energy or related components.
S&P Global Commodity Insights expects India to have 65 GW of annual solar module production capacity in 2024. Further expansion appears likely, judging by the Renewable Energy India Expo 2024 event held in October. Indian manufacturers are looking to export, potentially to Europe and elsewhere although the United States is their only viable destination at present. Polysilicon, wafer, and cells are the next step and the Indian government will act against imported cells from April 2026.
The US Inflation Reduction Act (IRA) helped drive a 40 GW-plus module production facility pipeline by mid 2024, according to the Solar Energy Industries Association. Ingot, wafers, and cells could be next despite President-elect Donald Trump’s criticism of current policy. Much of the IRA budget has been spent, and solar grew during Trump’s first administration.
TOPCon toppled?InfoLink estimated 1.1 TW of annual solar cell production capacity worldwide at the start of 2024, with 670 GW of it TOPCon, enough to supply global demand alone.
“Given manufacturers have usually actively engaged in R&D when profits were slim in the past, it is expected that technical breakthroughs and cost reduction will accelerate during this period,” noted InfoLink’s Alan Tu.
Laser-enhanced contact opening (LECO) improved TOPCon cell efficiency in the first half of 2024 but rival products are gaining ground. Longi and Aiko are betting on back-contact (BC) solar with Longi posting a 27.30%-efficient heterojunction cell, and Aiko showing a 25.2%-efficient all back-contact (ABC) module at Intersolar Europe in June.
In 2024, we’ve also seen the first commercial introduction of perovskite-silicon tandem modules, promising cell efficiencies well past the 30% mark. China’s Utmolight was among the exhibitors at the SNEC exhibition in May, and United Kingdom- and Germany-based Oxford PV announced in September that it had delivered its first tandem modules to a commercial customer in the United States.
Grids at the limitFinding space in electricity networks for new solar installations, and managing the daily and seasonal peaks and troughs of renewable energy generation, are an increasing challenge for aging grids built with centralized generation in mind.
The grid upgrades required in almost every region will take time to achieve and few are proceeding with much urgency. An April 2024 study by industry association SolarPower Europe found that while much of Europe has ambitious targets in place for solar installations by 2030, fewer than 50% of the region’s countries have appropriate energy storage targets. Only two have planned sufficient grid infrastructure investment and only four have demand side response goals in place. “Without proper energy system planning, solar projects will be held up, solar energy will be wasted, and the business case for solar will be undermined,” warned SolarPower Europe Senior Policy Adviser Jonathan Bonadio earlier in 2024.
That warning is already playing out. In Europe and other regions, waiting times for grid connection are growing – sometimes to several years. As solar projects proliferate and all want to transmit to the grid at the same time, curtailment from the grid and cannibalization of profits between projects are all too common.
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