Does this trend spell disaster for all solar businesses? No.
Solar producers will be hard pressed to reduce costs to be sure. There will be some that adapt and survive the current shakeout, and probably more that won’t. And while the recent decline in solar panel prices has been dramatic, declining prices are inevitable over the long run as solar grows and matures. While difficult for some panel producers today, declining costs will help solar to grow even as government subsidies are reduced.
While panel manufacturers deal with their challenges, the installation of solar grew 67% in the US in 2010, with rapid growth in Q1 2011 as described in the recent solar industry report from the Solar Energy Industries Association.
The price of solar power installation has not fallen as dramatically as the cost of panels for consumers or businesses - yet. The cost of solar installation is only partly based on materials so the cost of solar power for consumers so far as fallen only 12-17%. But with time the price of solar installation for businesses and homes will continue to fall as a result of the drop in the price of solar panels.
Even as Solyndra declares bankruptcy, solar installers like Sungevity and SolarCity are growing significantly, particularly where they can provide solutions like solar leases and power purchase agreements that help cash sensitive clients avoid the upfront costs of solar installation. A broad range of solar installers, solar lead generators, solar brokers, solar marketers, and other solar businesses will benefit from falling PV prices, helping solar to play a greater role in our energy supply, competitive with power from the grid in some markets. And we all benefit from the growth of cheap, clean solar power.
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