Author Sharon Chen
Updated May 07, 2021

Module prices quotes have been on the rise lately, according to senior analyst Sharon Chen of InfoLink. The prices, having returned to its 2019 level (average USD 0.334/W) in February, surged more than 12% in May. One major reason for this round of price inceases in modules is the jump in prices for G1 wafers amid shortage, as they are no longer mainstream and have become customized products.
Following more than 20% of increases in steel prices, concrete and hot-dipped galvanized mounting structure for PV systems rose, too. In the overseas markets, inverter prices increased by more than 15%, owing to IGBT shortage. Inverter suppliers in Taiwan, on the other hand, are still weighing against market dynamics; they will not raise prices until the end of June, for now.

Despite an additional 6% bonus to FIT rates for projects using domestic modules, EPC companies can hardly accept the module price hikes, which have affected their deliveries and contract prices, resulting in 1.5-3% of impacts on IRR for EPC companies about to connect systems to the grid. This may discrupt cooperations between EPC and module manufacturers in the future, with some EPC companies considering using modules from Southeast Asia at the expance of VPC bonus, and even widely adopt them for projects to meet future demand from the renewable energy market.
However, as the pandemic prevails, the Bureau of Energy has temporarily suspended the registration for imported modules. As a result, EPC companies are unable to acquire reasonable priced modules with higher efficiencies to make up for the loss of IRR of grid-connected systems. 

Before module prices hitting ceiling, small EPC companies put off grid connections unless necessary, while large EPC companies that are ready to connect ground-mounted projects to the grid face a standoff. Against this backdrop, it is certain that Taiwan will fail to achieve the 6.5 GW of cumulative installed capacity target in the first quarter and even the second quarter. 

As raw material prices hike, module prices show no sign of decline. The installation this year will see the biggest impact, which InfoLink has originally estimated to reach 1.7 GW, then revised downwardly to 1.5 GW, given market status quo. The goal set by the Bureau of Energy to add 3 GW of new capacity by the end of 2021 is even more difficult to fulfill. 

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