Tuesday, April 10, 2012
Photoelectric Prices in Germany
Preliminary data from BSW indicates Q1 prices for systems up to 100 kW were 1969 Euro/kW. The FiT revisions on April 1st put the market into a pricing transition period and it's hard to guess how far system prices will fall over the coming months. Average prices that settle out at 1800 to 2000 Euro/kW will be low enough to satisfy IRR and NPV hurdles for the sub-10 kW FiT tranche. Roughly 70% of the prices I've looked at are coming in below 2000 Euro/kW. Some systems in the 10 kW category are already approaching 1500 Euro/kW! From what I can tell there's still plenty of demand so these lower than expected prices aren't the result of starving installers trying to entice buyers with rock-bottom deals. I suspect we're simply seeing installers competing for customers.
In January I posted a rough bottom up breakdown which indicated that prices could get down into the 1400 to 1500 Euro/kW zone if need be. We are starting to see these sorts of prices. Maybe the prices are the result of demand falling off a cliff. Maybe the prices are the result of competition. My money is on competition. I suspect we will end the year with average prices down in the 1500 to 1700 Euro/kW range and over 8 GW installed...(Did I really say over 8 GW? Damn that's bold. Go high or go home I suppose)
Here's a 28 kW tier 1 system in Germany priced at 1412 Euro/kW. That's 1850 USD/kW.
Here's a 10 kW tier 2 system in Germany priced at 1690 Euro/kW (2213 USD/kW).
Here's a 7 kW tier 2 system priced at 1510 Euro/kW (1978 USD/kW).
Here's a 7 kW tier 2 system (LDK modules) prices at 1350 Euro/kW (1769 USD/kW). This is a fully installed price as far as I can tell. This is the record lowest price for a system in this size bracket!!!