Solar Panels Are The Main Cost of a Solar Power Plant

A solar power plant project has many ingredients one of the main being the cost of solar panels. Together with inverters they make about 60% of all costs of building a power plant and connecting it to the grid and proportion of their costs is falling. Solar panels come in different sizes and power so the best way to compare is in price per watt. While it was hard to get solar panels below $3 per watt before the crisis prices fell to just above 1$ since. There are two main reasons, one being lower price of silicon wafers and the other entrance of China as a manufacturer. For large projects buyers can ask manufacturers for special discount and the prices can go even lower. You can get about 90 to 100 kW of solar panels in a 40 foot container and that is a bargaining quantity threshold.

Certification

When Chinese and Indian manufacturers first entered the market they started to compete with German and American manufacturers on price and with clearly inferior quality. As with everything else, their quality has becoming better and better, they have obtained TUV and UL certifications and with good price/performance ratios they started to penetrate European and American markets. Certifications allowed them to get bigger orders and to force others to follow their price lowering.

Guarantee

Solar panels come with 5 year replacement warranty and for Indian and Chinese manufacturers this was a problem. Not that they wouldn't give such a warranty but their warranties were not backed by international insurers so it was harder to sell. Again, with certification they were able to get international insurance companies backing and penetration was easier, thus pressing on price lowering from competitors again.

Performance

Financing requirements and feed-in tariff required performance guarantee. Industrial standard has been established at 90% of listed power output until year 10 and 80% of listed power output until year 25. Performance need to be backed by recognized international insurance companies. Some panels perform better than others but price difference comes only to a few percent so manufacturers really can not command $3 price per watt if competition is selling at $1,5 per watt.

Solar Panels Insurance

A lot of bad things can happen to photovoltaic solar power plant in its lifespan so insurance is necessary. Because majority of solar photovoltaic power plants are financed insurance is a requirement. Insurance is one of the biggest operational costs of running a solar photovoltaic power plant.

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