Solar panel prices: Signs point to rebound as a supply glut may be ending

There's hope the sun may shine on the solar panel industry again soon enough. The decline in solar panel prices has been dramatic over the past year, as China's government-subsidized solar panel manufacturing companies have ramped up production and flooded the market with cheap photovoltaic cells. In a Reuters article, alternative-energy research company New Energy Finance said it expects panel pricing to fall further still in 2009 and into 2010. This jibes with the panel-pricing slide I reported in September.

But there are some early indications that the price decline may be slowing, as the glutted solar panel market's supply and demand imbalance begins to right itself. I spoke with several solar panel installers in California who said panel maker SunPower (SPWR) has begun to notify its customers that it is running short of inventory. The company did not immediately respond to requests seeking comment. SunPower is considered to be among the most technologically advanced of the solar panel makers and it tends to command a premium price for its panels, which boast a higher efficiency rating than many of the cheaper photovoltaic products.