It’s happening at the worst possible time. For the last couple years, the world had witnessed a glut of Chinese and Indian panels flooding the market and driving down prices. But now, the opposite is occuring, and the timing is just lousy.
Today, we received a notice about preparing to look for new suppliers of solar panels to avoid shortages in the coming months. Why is that such bad news? Well, first of all, the summer installation rush is right around the corner.
Say what? It’s still mid-March as this post is being published. Yes, but project timetimes are slowed down by permit approval backlogs at local government offices, and especially by the utility companies, which have to approve interconnection of solar to their grids. A family deciding to start their solar project today will see their system installed in June / July 2019, and the utility will give Permission to Operate weeks after that if all goes well during the inspection process.
Why the rush and why is it significant? Many homeowners and businesses are rushing to take advantage of the 30% Federal Tax Credit (ITC) for purchasing solar PV generation equipment. The ITC is being phased out and systems installed after December 31, 2019 will receive a lower tax credit.
But the resulting rush to install solar projects in the USA is not the reason inventories of solar panels are running low at major suppliers. It’s more likely that the massive gigawatt-sized solar developments by India and China have overwhelmed manufacturers around the globe, causing our supplier to send us this warning:
The shortages will not only delay projects, but the high demand and falling supply will result in higher prices for solar PV modules. Adding to the upward price trend will be the solar tariffs which kick in after a wet volume is imported.
That leads to two conclusions for those still waiting for the right time to go solar:
- The panel supply shortages can lead to installation delays making you miss the 2019 dealine for claiming the Federal Tax Credit at the full 30% value;
- The price of your equipment will rise.
In other words, the best time to go solar was yesterday, and the next best time is today.
Don’t wait until it’s too late.