The Squeeze: Trends in Solar Balance of Systems

December 25, 2013 | State of the Market Report

As crystalline silicon module prices crashed in recent years, developers and installers benefitted greatly from the low prices and sudden economic feasibility of solar in new markets. With those same prices now stable, developers are putting pressure on the balance-of-systems side of the industry to continue to reduce costs. In each application segment, various factors influence the evolution of balance of systems – ranging from the general dynamics of a typical project to the nature of the business of developers active in the segment. Incremental improvements to today’s system setups will lead to system capex reductions between 15% and 30% – largely thanks to racking and mounting cost reductions and increased module efficiencies – corresponding to levelized cost of energy reductions between $0.05/kWh and $0.07/kWh by 2020. However, microinverters and high-voltage configurations stand to accelerate those reductions. Overall, the plethora of options will accelerate cost reductions in every geography and application segment – and provide opportunities for both new entrants and existing solar stakeholders to poach additional market share.

Coverage Area

  • Owning the Energy Transition

Table of Contents

  • Executive Summary
  • Landscape
  • Analysis
  • Outlook
  • Endnotes