The rising cost of polysilicon, a key component of solar panels, is a major concern for the photovoltaic (PV) industry in 2024. It threatens to slow down production and increase the cost of solar energy, potentially hindering progress towards renewable energy goals

This is according to market research conducted by PV Tech, a solar-focused media company. The findings were presented during a webinar held on February 15.

The impact of the polysilicon market trend has proven to affect PV production at all levels and threatens to reduce already precarious profit margins for PV production companies worldwide, said Finley Colville, the company’s head of market research.

Polysilicon, cell and wafer-production-dominant facilities will feel the impact of the downturn most harshly as operating costs will remain the same during the price surge, he said.

Another trend that will continue to impact the market in 2024 is the focus on module manufacturing closer to home. “Buyers in the United States and Europe are questioning the origins of materials used in module manufacturing. No one wants to buy a PV module only to find it has been stuck at customs,” Corville said.

This phenomenon puts further pressure on PV producers as affordable polysilicon from China becomes problematic to use, he said.

This “problem” could result in an exciting time for PV technology. “When things are going well and everyone is making lots of money, people are hesitant to change technology. This could be the pressure the industry needs to develop new technologies.”