Us Solar Prices Double European Costs Amid Regulatory Challenges
The requirements of measures such as the Uyghur Forced Labor Prevention Act (UFLPA) mean that solar panel prices in the
PV Magazine International 12:53 pm on May 23, 2024
The renewable energy sector is facing challenges due to project delays, obsolescence from technological advancements, and regulatory uncertainties. The influx of supply caused by tax credits in the US has led to a surge in manufacturing, contrasting with slower development processes. Regulatory changes, such as EU's UFLPA, have created pricing differences between Europe and the US, affecting global dynamics and market prices for solar panels.
- Policy & Tax Credits: The Inflation Reduction Act (IRA) tax credit spurred a rapid increase in equipment supply, causing discrepancies between development speed and manufacturing growth.
- Regulatory Uncertainty: Developers face unpredictable outcomes from regulatory changes like US presidential elections and the EU's UFLPA, impacting market conditions and investments.
- Technological Obsolescence: Project delays risk equipment becoming obsolete, necessitating resale at lower prices, thus affecting profitability and asset management.
- Market Prices Disparity: A price gap exists between Europe's low-cost modules (up to $0.11/W) and the US market (around $0.24/W), driven by regulatory differences and supply chain adjustments.
- Supply Chain Diversification: Developers are navigating complexities in international trade, such as tariffs and import restrictions, which influence project planning and execution.
https://www.pv-magazine.com/2024/05/23/solar-buyers-market-but-us-developers-face-price-premium/