Solar Panel Prices have decreased at a jaw dropping 50% in the last 2 years and will probably decrease 10-15% more in 2011.That is an astounding number given the increasing energy and electricity prices being faced around the globe.Though solar energy is costlier than other forms of energy,it starts on a low base.With 2010 solar growth pegged at more than 100% and 16 GW of solar panels installed,Solar Energy is starting to become more mainstream.Like Solar,the entry of Chinese players has decreased the cost of Wind Energy as well.Despite increasing input steel and copper prices,wind turbine prices have declined.Stiff competition amongst Chinese WTG companies has made the price of a  Wind Turbine go as low as $600,000-700,000 in China.This has brought a depression in prices in other places in the world as well.

High cost Western companies like Vestas and Gamesa have felt the pain acutely.However customers have benefited immensely.With the prices of conventional forms of energy like Oil and Coal increasing,the decreasing price of Renewable Energy has made them more competitive.In some windy places Wind is competitive with coal while Solar Energy has become equal or lower to retail electricity price in Hawaii and Italy.With this trend continuing expect faster adoption of Clean Energy.

Analysis: Lower wind and solar prices to usher speedier adoption

Rapid recent solar and wind price falls are likely to bring new markets and mass adoption a step closer over the next decade and raise the prospects of mergers.

The financial crisis coupled with a ramp-up in China, which now leads the world wind and solar manufacturing, have led to over-capacity and pressured prices in the past three years.

Those solar companies that weather the price storm could be set up for a mass market with strong returns, driving expectations of acquisitions by leading electronics and semiconductor companies.

“The number one company in the world holding solar patents is Samsung, but they’re not sure how to jump into it,” said Jefferies’ Reid. “Semiconductor companies like Intel are also looking closely.”