Amongst other things, 2012 will be remembered as a particularly difficult year for producers of c-Si PV modules. Average sales prices (ASPs) declined at a fast pace during the year, despite frequent announcements from module suppliers that pricing was about to stabilize and then rebound.
Featured in the forthcoming NPD Solarbuzz Marketbuzz report, a full analysis of global weighted average c-Si pricing shows that module ASPs declined by approximately 50% on a year-on-year basis in 2012. 2012 was the fourth year in a row that c-Si PV module prices have declined and last year set a new record in terms of annual percent decline.
Indeed, since hitting a pricing peak of above $4.00/W in 2008, c-Si module prices have fallen by 80% over the past four years; the compound annual rate over the past decade is approximately -15%.
The decline in module prices has also lead to pressure on margins. In 2012, even those manufacturers that were able to increase market share were still operating at negative margin levels due to intense price competition. This trend is also leading to a move by major manufacturers to enter the downstream of the PV industry in an effort to secure higher margins in project businesses.
Going forward, supply and demand rationalization will be key in determining the timeline and trajectory of ASP movements. Until that point, the goal for most companies will simply be to survive until a positive margin industry emerges again.
So far in 2013, there have been few if any real signs of change. Over-capacity still exists, as does the scope for over-supply. The PV industry is still comprised of a 30 GW end-market being supplied by a 45 GW upstream manufacturing engine. And as long as this imbalance exists, ASP stabilization will be the first target for the upstream suppliers.
Figure 1: c-Si Y/Y Module ASP Percent Declines 2004-2012
Source: Adapted from NPD Solarbuzz Marketbuzz