GE has put on hold plans for construction of a solar panel factory in Colorado, slated to be the largest in the country.

When it announced construction plans last October, GE had said it anticipated the facility to start up earlier than expected, with the first panels coming off the line in 2012 and commercial availability in 2013.

At capacity, GE had said, the Aurora, Colo., factory would produce 400 megawatts a year, enough panels to power 80,000 homes.

The factory was to employ 355 people.

GE's solar initiative is yet another casualty of the steep drop in prices of solar panels amid an oversupply of panels in the global market.

News of the construction postponement follows last week's bankruptcy announcement of Colorado-based Abound Solar, recipient of a $535 million U.S. Department of Energy loan guarantee.

Abound was GE's competitor in thin-film cadmium telluride -- or CdTe -- photovoltaic modules.

"Absolutely, we remain committed to this project," Danielle Merfeld, GE's general manager of solar technology, told The Denver Post Thursday. "It's just a matter of the timing."

Stressing it is important for GE to "have the right technology at a competitive cost," Merfeld said price drops were creating a shift in the solar sector.

"With those market conditions, we can't go forward at this time," she said.

"There are more than two times the amount of modules being manufactured than are demanded. So we're doubling-down, shifting back from manufacturing to technology development," she said.

"Improving the technology has to be the way for GE to become cost-competitive," the Financial Times quoted Shyam Mehta, senior solar analyst for GTM Research, as saying. "But they have an uphill struggle ahead of them."

GTM says prices of PV panels are continuing to fall: Last year's $1 per watt is expected to drop further to 70 cents per watt by the end of this year.

If global overcapacity continues, GTM says, PV panel prices could fall to 55 cents per watt in three years.

GE says when the company resumes factory development in 2014, it plans to build modules expected to reach 15 percent conversion -- a measure of the conversion of sunlight into electricity -- from the current level of 13 percent.

"Based on this announcement," says a Solar PV Investor report, "chances are we will never hear about it again."

"The truth is that by 2014 modules made from polysilicon will be reaching levels of 17 to 19 percent conversion; moreover, this will be at prices that will match or be even lower than any thin-film manufacturer," the report states.