Growing demand for solar is one of the key factors that is driving down its price.

According to a new report from Pike Research, in many markets, solar costs will reach the long-elusive goal of grid parity, the cost of electricity from traditional power sources, by 2013. Between 2010 and 2013, Pike Research forecasts that solar demand will increase at a compound annual growth rate (CAGR) of 24 percent.

“Solar prices are plunging quickly, and lower pricing will fuel a surge in demand in 2010 and beyond,” says Pike senior analyst Dave Cavanaugh.

According to Cavanaugh, ten key factors will determine success and survival for solar suppliers during this period of industry consolidation:

• Low-cost polysilicon and wafers
• Low-cost process materials
• Low-cost processing
• Module efficiency
• Economies of scale
• Market presence in key growth countries
• Supply chain integration
• Strong balance sheets and internal financing of growth
• Module manufacturing in North America and low-cost European Union countries
• Strong position in niche markets

Pike Research’s report, “Global Solar Energy Outlook”, provides an analysis of the supply and demand dynamics in the rapidly changing global solar market. It examines the underlying economics of solar manufacturing and assesses the industry’s progress toward grid parity from a cost perspective. The report includes a detailed analysis of key solar industry players and outlines the key differentiators that will cause some suppliers to thrive, and others to fall by the wayside. An Executive Summary of the report is available for free download on the firm’s website.

Pike Research is a market research and consulting firm that provides in-depth analysis of global clean technology markets. For more information, visit www.pikeresearch.com.

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