After a turbulent start to the year, global solar and storage markets are now showing signs of stabilisation. The removal of Chinese export tax incentives and a pre-Chinese New Year demand surge pushed module prices up by 15–20 percent, with most manufacturers sold out through March. As production returns to normal, prices are softening again, especially in the PV segment, indicating that the recent spike was driven by timing factors rather than a structural imbalance.
March PV Index – prices rise with early signs of correction
Meanwhile, rising geopolitical tensions in the Middle East are introducing fresh uncertainty. Oil and gas prices are moving higher and logistics routes are under strain, but this has not fed through into solar and storage pricing. Transport is less predictable and somewhat more expensive, but global manufacturing capacity still outpaces demand, keeping module prices on a downward path.
Demand for battery storage rapidly rising
Despite all this, examining pricing alone risks missing a significant shift on the demand side, particularly in battery storage. Demand for battery storage solutions is rising rapidly across Europe, driven by high energy prices and grid congestion. Yet the ability to convert this demand into real projects is inconsistent. Where the solar sector traditionally saw an 80/20 distribution, the BESS market is moving towards a 90/10 split, with a small group of companies capturing most of the realised business and the wider market struggling to deliver bankable projects.
March Battery Index – residential prices fall, C&I softens
This disparity is structural. Storage is not a product, it is a system, and systems require expertise. Battery storage demands integration across several domains: energy markets and trading strategies, EMS and software integration, financial modelling and revenue stacking, as well as regulatory and safety frameworks. This complexity creates a bottleneck, as demand exists but execution capacity is limited.
In the short term, this sustains price stability. Increased demand does not immediately drive pricing pressure, since only a fraction of projects reach execution. In the long term, sustained geopolitical tensions could lead to higher energy prices and accelerated demand for solar and storage. As execution capabilities improve and more projects become bankable, this demand will start to close the gap with global supply. The current phase is not the end of volatility, but a transition. The market is stabilising after a policy-driven spike, while preparing for a demand-driven shift. (Gerard Scheper/hcn)
