Polysilicon prices spike on factory shutdowns

Prices for a key solar panel material climbed this week as extreme heat and water shortages in China forced factory shutdowns.

Why it matters: Rising polysilicon prices make the math on certain solar projects even harder — and signal that some U.S. importers will have to wait longer for vital solar components.

Driving the news: Prices on benchmark polysilicon chips ticked up more than 0.33% this week, per data from PV Tech.

• The trend marks the 26th price hike since the start of the year.

What's happening: Withering heat in China has sparked a surge in demand for cooling — in turn putting heavy demand on electric grids.

• That's spurred grid operators to implement power rationing, forcing some factories to pause production for days at a time.
• Meanwhile, suppliers in China had already locked in monthly orders, leaving little space to fill new ones.

Zoom out: Making matters worse for U.S. importers, many are seeing their imports of modules tied up with detentions and delays by U.S. Customs and Border Protection as it enforces the Uyghur Forced Labor Prevention Act.

• The agency is taking what seems a stricter than expected approach in implementing the law, which aims to rid solar supply chains of forced labor in China.