Yes, you heard it right. If you are planning to install the solar system for your facility, then now is the best time. Few justifications for our claim are as follows:
- Discount of more than 49%!
Solar panels rates have reduced by more than 49% from last year’s peak. In Chinese market, the solar panels have come down below $0.13 per watt price mark. This is the all-time low price. Before this, the lower price was in 2019, when the poly-crystalline panels were in that price range. Post COVID, the prices continuously increased. Today, better quality panels like Mono-Half-Cut-Bifacial solar panels are available at a cheaper price than the old poly panels.
Due to high import pressure, Indian manufacturer is also selling solar panels at a discounted price.
- ALMM from April 2024
Government of India has notified that from April 2024, only those solar panels which are listed under the list of ALMM (Approved List of Modules and Manufacturers) will be allowed under net metering and government projects in India.
As of now, only Indian solar panel manufacturer is registered under this ALMM list. As soon as import of solar panel cools down, the prices of solar panels tend to increase. This same has happened in 2022-23 when the Government has first introduced ALMM.
Though the ALMM rule is on hold till April 2024, we have internal news that the Government have all the intensions to reinstall this ALMM.
- Chinese New Year
We all know that February is a month when whole China celebrates its new year. China is the biggest manufacturer of solar panels. In this month, the production in China slows down. For almost 1 week, all the manufacturing units in China are going to halt the production.
Due to the slow supply and constant demand, the prices will increase. For many years, we are seeing this trend and hence, this Chinese New Year plays an important role in solar price hike.
- Post Christmas effect
European and other westerns countries are preparing for Christmas and new year. Due to this celebration, the demand is low and hence the prices have further come down. Post Christmas, as the western market opens, the demand is going to increase and hence the prices will also increase in the next quarter.
In the new year, all the stakeholders will have fresh green-energy targets and hence, demand is going to increase.
- The depreciation effect.
Next quarter is the last quarter for Indian Financial year. Those who want to claim depreciation in their books of accounts need to install solar system before 31st March. Hence, many projects will pick up due to this constrain.
We are in talks with many project developers and everyone has confirmed that their order book is getting full. This is a direct indication of good demand in the coming quarter. Based on simple Demand-Supply logic, the prices of solar panels are going to increase.
- Low global stock
The main reason for the sharp price drop for solar panels is due to huge solar panel stock and low western demand. Due to this stock, all the manufacturers were forced to dilute the stock at a discounted price.
As per the latest reports, the stock issue is solved. Now all the manufacturers have limited stock of 1 or 2 months. This is an indication that in the coming future, prices are going to increase.
- The finished product price is lower than raw material.
If one tries to calculate the price of raw material used to manufacture solar panels, then one will find out that solar panels’ price is lower than the collective price of raw material. This is a non-sustainable situation from an economics point of view. This situation cannot last long.
All the manufacturers are trying to break through. Hence prices of solar panels and related components are going to increase.
Prices of other commodities like metal are at an all-time low. Hence the cost of a complete solar system is at an all-time low. Based on all the analysis, we at Chirayu power are of the opinion that the perfect time for getting the solar system installed has come.
If you have plans for getting this green system installed or if you know someone who wants to get this system, this is the right time to make a move. Let us make sure to get the best deal for your solar power plant.
Please let us know your thoughts on this article. Provide your valuable comments for our improvement. Let us know topics on which you would like us to create our next blog.
