In the first quarter of 2026, PV module price increases were driven primarily by China’s decision to end export-related tax incentives from 1 April, triggering a rush to secure volumes. Most tier-1 factories were sold out by March, pushing prices up by 15–20%.
The policy change effectively compressed demand into a single quarter, driving prices higher. Upstream cost pressures have also played a role, with rising silver prices increasing module production costs. As a critical input in PV cell manufacturing, silver has a pronounced impact on price sensitivity.
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Following the Chinese New Year, production resumed and the market adjusted. Module prices are easing slightly, while polysilicon prices remain stable, indicating that the recent spike was driven by timing and availability rather than a structural issue. For European buyers, the pattern is familiar: a phase of volatility followed by renewed competitive pressure, as global supply-demand imbalances persist and manufacturing capacity remains substantial.
Geopolitics a factor, but not yet in pricing.
Tensions in the Middle East, including confrontations involving the United States, Israel and Iran, have pushed up oil and gas prices, raising expected manufacturing and logistics costs and potentially supporting renewable demand. So far, however, solar and storage prices have not reacted. Logistics are affected, with transport costs rising modestly, but module and battery prices remain stable, reflecting ongoing oversupply and strong competition.
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The key driver is delayed demand. If high energy prices persist, demand for solar and storage is likely to rise, as seen during the Russia–Ukraine conflict. The impact of geopolitics on pricing is therefore not immediate, but driven by demand and subject to a lag. If demand begins to catch up with global production capacity, pricing could firm gradually.
The market is stabilising after a policy-driven spike. In the medium term, external factors, particularly energy markets, may shape the outlook. For now, the spike has passed, but uncertainty remains. (Gerard Scheper/hcn)
