Decline Continues for Solar Panel Manufacturing Revenue

The solar panel manufacturing industry has experienced a rapid rise and fall over the past five years. While government incentives for downstream customers fueled strong growth early on, tax credits reduced the cost of solar panels, making them more affordable for consumers and businesses. In addition, rising coal and gas prices have also improved solar power’s competitiveness against traditional electricity generators.

But as silicon prices fell, international manufacturers were able to pump out large quantities of low-cost solar panels, increasing competition with the U.S. industry. Consequently, solar panel prices plummeted in 2011 and revenue deteriorated, falling 21.6% in 2011 and an expected 32.5% in 2012, according to a new report from IBISWorld. As a result of the contrasting trends over the past five years, revenue is estimated to fall at an annualized rate of 3.9% to $823.1 million in 2012.