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In five key trends, pv magazine looks back on a year in which PV module prices have fallen further than many thought possible, while demand has been held back by grid congestion, among other issues. Energy storage has had a strong year and geopolitics is seeing solar and battery manufacturing enter new regions as competition drives technical innovation.
Module price madness
Falling solar module prices were the defining trend for solar energy in 2024. In January, headline prices were close to $0.15/W in an oversupplied market.
In mid-November 2024, energy pricing consultancy OPIS reported prices below production cost of $0.087/W for the latest tunnel oxide passivated contact (TOPCon) products, with further declines still rumoured.
While low prices typically stimulate demand, the oversupply has been exacerbated by order restrictions. With more efficient technologies rapidly emerging, buyers fear being stuck with outdated stocks. Tariffs and other trade measures block the entry of imported goods into major markets, especially the United States and India.
The rise of solar power in recent years has forced many countries to laboriously upgrade their grids, and the slow pace of progress has been compounded by shortages of transformers and other equipment.
The consultancy InfoLink has forecast a small annual increase in global solar demand in 2025, but has indicated that there could actually be a decline.
Most observers expect the PV oversupply to continue into 2025, with numerous solar distributor and installer bankruptcies, while manufacturers are generally managing to hold their own. However, while the largest manufacturers are weathering the storm, InfoLink expects smaller Tier 2 and 3 producers to struggle in the near term and has forecast “large-scale production capacity exits” from the polysilicon segment in 2025.
The China Photovoltaic Industry Association urged its members in early November not to offer solar module prices below 0.68 yuan ($0.09)/W in tenders. Chinese manufacturers have told pv magazine that they can get by with between $0.12 and $0.13 per W.
Manufacturing goes global
Amid rising geopolitical tensions, many are realizing the dangers of relying on a single region for energy supplies or related components.
S&P Global Commodity Insights forecasts that India will have 65 GW of annual solar module production capacity by 2024. Judging by the Renewable Energy India Expo 2024 event in October, further expansion seems likely. Indian manufacturers are looking to export, potentially to Europe and elsewhere, although the US is their only viable destination at present. Polysilicon, wafers and cells are next, with the Indian government cracking down on imported cells from April 2026.
According to the Solar Energy Industries Association, the US Inflation Reduction Act (IRA) has helped spur the construction of more than 40 GW of module production facilities by mid-2024. Ingots, wafers and cells could be next despite President-elect Donald Trump’s criticism of the current policy. Much of the IRA budget has already been spent, and solar boomed during the first Trump administration.
Is TOPCon collapsing?
InfoLink estimated 1.1 TW of annual solar cell production capacity worldwide by early 2024, with 670 GW of it TOPCon, enough to supply global demand on its own.
"As manufacturers in the past tended to actively engage in R&D when profits were low, technical advancements and cost reduction are expected to accelerate during this period," said Alan Tu of InfoLink.
Laser-enhanced contact opening (LECO) improved the efficiency of TOPCon cells in the first half of 2024, but rival products are gaining ground. Longi and Aiko are betting on back-contact (BC) solar: Longi presented a heterojunction cell with 27.30% efficiency, and Aiko showed a full back-contact (ABC) module with 25.2% efficiency at Intersolar Europe in June.
2024 also saw the first commercial introduction of perovskite-silicon tandem modules, which promise cell efficiencies well above 30%. China’s Utmolight was among the exhibitors at the SNEC show in May, and UK- and Germany-based Oxford PV announced in September that it had delivered its first tandem modules to a US commercial customer.
Networks at the limit
Finding space on power grids for new solar installations and managing daily and seasonal peaks and valleys in renewable energy generation are increasing challenges for aging grids built with centralized generation in mind.
The necessary grid modernisation in almost all regions will take time and few are proceeding with urgency. A study in April 2024 by industry association SolarPower Europe found that while much of Europe has ambitious solar installation targets for 2030, less than 50% of countries in the region have adequate energy storage targets. Only two have planned sufficient investment in grid infrastructure and only four have demand response targets. “Without proper energy system planning, solar projects will be delayed, solar energy will be wasted and the business case for solar will be undermined,” warned Jonathan Bonadio, senior policy advisor at SolarPower Europe, in early 2024.
This warning is already coming true. In Europe and other regions, waiting times for grid connection are getting longer, sometimes lasting several years. As solar projects proliferate and all want to transmit to the grid at the same time, grid throttling and profit cannibalization between projects is all too common.
Grid modernisation is a slow process, compounded by recent reports of shortages of transformers and other vital components. Faced with this challenge, 2024 has also seen a wave of innovative solutions from policymakers seeking to speed up connections: The latest update to Poland’s energy law is a case in point. In an attempt to avoid congestion in spot electricity markets, private power purchase agreements (PPAs) are proliferating, as are hybrid systems that combine solar and wind power and energy storage, to better spread generation throughout the day.
Battery boom
Energy storage is a key part of the solution to these grid constraints and is increasingly seen as part of the renewables equation. This is reflected in the launch of pv magazine’s ESS News platform in 2024 , dedicated to energy storage news.
This year, the sector has also suffered from oversupply and price falls, with surprising reports of a drop below $50/kWh for two-hour battery systems made in China. Nameplate battery manufacturing capacity in China alone reached 2.2 TWh by the end of 2023, almost double the 1.2 TWh of global demand that analyst BloombergNEF (BNEF) expects for 2024.
However, falling battery prices have boosted demand. BNEF also reported that prices for complete turnkey systems had fallen by 43% since 2023, while the stationary storage market has risen by 61%.
Rising energy density was one of the key trends in large-scale storage, as manufacturers innovated to squeeze more battery capacity into container-sized products. The move to 300+ Ah ??cells and 5 MWh containers happened faster than expected.
Regulators in many regions are also working to set the conditions for batteries to be able to offer more services to the grid. That opens up more potential business models for battery operators. The promise of managing all those opportunities and ensuring owners make the most of them saw the emergence of “revenue optimisation” software packages as another key trend in 2024. In some markets, such as Germany, revenues from commercial batteries remain strong; in others, all eyes are on procurement processes. In Italy, all eyes are on the storage futures market tender, while many other European countries have introduced capacity market auctions. In the US, new market entry routes have included PPAs (power purchase agreements) and tolling contracts that incorporate energy storage assets.
There has also been notable growth in commercial battery installations, often alongside solar generation capacity. Businesses are turning to renewables to protect themselves from high energy prices and installers are seeking markets less affected by grid capacity issues. |
