Falling TOPCon module prices make it difficult to sell PERC solar products

The price of tunnel oxide passivated contact (TOPCon) solar panels continues to fall. Martin Schachinger, founder of pvXchange.com, explains how this will impact sales of his PV modules based on passivated emitter rear cells (PERC) cells.

May 22, 2024 Martin Schachinger, pvXchange.com

Prices for lower performance solar modules remained largely unchanged this month, but there were significant price adjustments for modules with efficiency levels above 22%.

Prices for these modules, which mainly feature n-type/TOPCon cells and double glass, are now coming in line with mainstream module prices. Only upward outliers exist for some types with interdigitated back contact (IBC) or heterojunction (HJT) technology, but they are not considered separately in this analysis.

Production of n-type cells and modules in China seems to be increasing, but the new US tariff situation may already be having an impact. The question is: how will this affect the European market? Lower and lower prices mean that demand will continue to grow unless some disruptive factor occurs.

Modules manufactured before 2023 are still heavily stocked among dealers as well as installers. But if these are 2m2 in size, they will sell poorly due to their poor performance. Building owners usually want new systems with high performance and the latest technology, so it is much harder to sell existing products.

Even though module production and imports are expected to decline, more Asian modules are still being delivered to the European market than is currently in demand. This has led to increased inventories, even for high-performance models, putting further pressure on module prices.

Therefore, inventory of older modules that were manufactured and purchased at significantly higher prices in the past must continue to depreciate in value. However, this is not possible for all players, so the prices on the market for modules with PERC technology vary widely. Overall, the price difference between these categories is becoming increasingly narrower.

Modules will become saturated in Africa and Southeast Asia, and Chinese products will no longer be sold in the U.S. market. One strategy that is becoming popular is to consider the soft side of commercial business: payment and delivery terms. In exchange for offering modules at low prices, they often grant lines of credit without requiring collateral and promise free shipping. However, it is questionable whether this tactic will work in the long term. Many small and medium-sized enterprises in particular are in crisis, and payment defaults cannot be ruled out as imminent.

Some suppliers turn to online marketplaces to quickly sell their inventory to overseas customers without incurring sales and marketing costs. But the competitive pressures there are also great, and they often can only sell such goods at dumping prices. Another problem is that there is little way to know potential business partners in advance, which means you just have to take what you get.

Misunderstandings can occur in business transactions, especially when crossing borders, and online platform operators are not always able to provide support or advice. The effort involved in running an online business quickly becomes greater than buying or selling within an established business relationship.

My preference for using surplus old modules is clear: to install them in larger open spaces or on rooftop systems. In many cases, the smaller format is not a bad choice, especially in areas with high wind and snow loads. The slight increase in material and assembly costs for better static electricity is offset by the easier handling.

Additionally, there is another undeniable advantage. Modules are already in stock and available with certainty, so there are no delivery issues or delays in the construction process. You may find some unsold inverters and cable reels, but you’re almost done with the components of your PV system.

Once the system is built and connected to the network, no one cares if the modules are the latest generation or not – in any case, the resulting assets can be sold.

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