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Anyone who has looked into going solar or wants to go solar can now benefit from the decrease in solar panel prices and the increase in federal and state incentives that subsidize solar. According to investment bank analysts at Piper Jaffray, the price of panels have dropped nearly 40 percent compared to last year. What is driving the cost down? Simple supply and demand as well as the decreasing cost of raw materials.
Although solar demand has increased in the United States due to federal and state incentives, overall worldwide demand has decreased. The decrease in demand is in large effect from the decreasing solar subsidies in European countries, making the installation of solar more cost-prohibitive with a longer payback period. According to Emerging Energy Research, a consulting firm, solar photovoltaic installations in Europe are forecasted to fall by nearly 26 percent compared to last year.
The decreasing cost and availability of polysilicon (the key component to most types of manufactured solar) has also contributed to the decrease in solar panel costs. More overseas companies, especially in China have become involved in the direct manufacturing of polysilicon which has decreased the overall cost of manufacturing the panel. Consumers can also benefit from the technological advances in the solar industry that have lead to increased efficiency in the solar modules manufactured today. This means fewer panels with greater energy output.
In addition to the decreasing cost of panels, consumers can also take advantage of available federal and state solar rebates, credits, and grants to further decrease the net cost of their solar system. To better understand what solar incentives are available in your state, visit the Database of State Incentives for Renewables and Efficiency at: www.dsireusa.org.
