In a statement released by the research companys Henning Wicht, senior director and principal analyst, photovoltaics, it is said that this "major milestone" could work to stimulate photovoltaic installation demand, thus avoiding the widely predicted decrease expected next year.
"An assessment of this magnitude," states Wicht, "bold in its purview and implications, comes in the wake of an accelerated, rapid decline in pricing for deals following the Intersolar Trade Fair, site of the worlds largest PV exhibition, held last week in Munich, Germany."
He goes on to explain that before the start of Intersolar Europe, held from June 8 to 10 in Munich, spot prices for mainstream crystalline silicon photovoltaic modules, from the "top Chinese brands" were USD$1.49 per watt.
However, he says that by the end of the trade show, prices had decreased to just USD$1.30 per watt. This decrease was primarily attributed to fears that the market will be either flat or negative next year.
"The recent price decline was quickened by top-tier module brands dropping prices to aggressively position themselves, in the face of fears that the industry could be headed toward a down market next year," commented Wicht.
"The drops in pricing were spurred by the recent price slide in cells and wafers, with wafers being quoted in the $2.30 per-piece range, down from $3.50 in March."
Consequently, IHS believes that from the USD$1.30 seen for the modules today, costs per watt will drop to $0.99 by the second quarter of 2012, $0.88 per watt by the second quarter of 2013, and $0.79 per watt by the second quarter of 2014.
Gross margins, meanwhile, are expected to be in range of between 10 to 12 percent this quarter. However, due to "intense competition", IHS believes they will fall to between five and nine percent by the second quarter of 2012.
Mike Sheppard, analyst for photovoltaics and financial services at IHS says that these costs could be both "momentous" and "far-reaching", with the consequence that prices for certain installations could drop to as low as $2 per watt.
"Not only could such a development ward off a dip predicted in solar installations for 2012, it also signals that deep-pocketed and lower-cost structured companies will be getting aggressive about pressuring competition out of the market during the next year," he said.
If IHS' predictions do come true, they could prove to be a major boost for the U.S.s SunShot program, which is aiming to get installation costs down to $1 per watt by 2020.
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: email@example.com.
By submitting this form you agree to pv magazine using your data for the purposes of publishing your comment.
Your personal data will only be disclosed or otherwise transmitted to third parties for the purposes of spam filtering or if this is necessary for technical maintenance of the website. Any other transfer to third parties will not take place unless this is justified on the basis of applicable data protection regulations or if pv magazine is legally obliged to do so.
You may revoke this consent at any time with effect for the future, in which case your personal data will be deleted immediately. Otherwise, your data will be deleted if pv magazine has processed your request or the purpose of data storage is fulfilled.
Further information on data privacy can be found in our Data Protection Policy.