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Solar panel prices are rapidly decreasing in price, causing many consumers to purchase panels that were once thought to be too expensive. Since mid-2008, solar panel costs have decreased by forty percent.
The cause of the decrease is due to the increased supply of panel ingredients. Polysilicon, which is a main ingredient in most solar panels, used to be limitedly produced. However, factories around the world have been opening, increasing their availability. China is one country leading to the decrease in solar panels as they recently opened more plants and have been producing more panels and panel ingredients.
Prices for solar panels are expected to decrease even more, however experts believe it will not be as drastic a drop. Some manufacturers are suffering from the decreasing prices, while others are looking at it positively. Many solar companies are seeing economic losses, however, overall they believe the cost of solar needs to decrease to expand the market.
Global demand for solar panels has decreased, particularly in Europe. Spain, a popular locale for solar panels, saw a drastic decrease in solar panel sales. The slow down in Spain is partially attributed to the government reducing their subsidy program. The largest market for solar, Europe, expects to see a decrease in sales of twenty-six percent.
In the United States, the residential area of solar is still increasing in sales. The largest solar consumer in the U.S., California, saw increased sales of fifty percent in July compared to last year.
In addition to the dropping solar panel prices, consumers in the United States are also seeing increased government incentives. Solar installations generally receive a thirty percent tax credit from the government. However, as of January 1st of this year the government lifted their maximum credit cap of $2,000. This has brought many more customers into the solar realm.
The combination of the federal tax credits and decreasing prices has decreased the amount of time to pay off the solar panels themselves. It is estimated that the original time it would take is twenty-two years. In the current market it is estimated to be sixteen years. These figures are based on locations which have high electricity costs.
