After a relatively sober 2009 where installations grew by ‘only’ 24%(admittedly in the midst of a global recession), the global PV marketroared back to life in 2010, where the 17.5 GW of installations exceeded the previous years’ 7.2 GW by a staggering 141%. In large part, thiscan be traced to three factors – (i) the continued strength of Europeanfeed-in tariff markets – most notably Germany (7.3 GW), Italy (3.9 GW),and the Czech Republic (1.2 GW), (ii) component prices drops that untilnow, have kept pace with subsidy cuts (tier 1 Chinese crystallinesilicon module prices declined from around $2.20/Wp on average in 2009to $1.75/Wp in 2010), and (iii) the availability of sufficient supply of polysilicon, wafers, cells, and modules due to the rapid expansion ofmanufacturing capacity, especially in the low-cost regions of China andTaiwan. However, demand in the second and fourth quarters of 2010outpaced the ability of suppliers to keep up despite this still-ongoingcapacity build-out; component shortages (especially for wafers, cells,and inverters) were a recurring feature of 2010, with mostcost-effective top-tier manufacturers being sold out well before thefirst half of the year. It is conceivable that installations couldconceivably have crossed 20 GW absent capacity constraints forcompetitive suppliers. Given this state of affairs, it is not surprising that 2010 was a year to remember for suppliers. Global PV cell andmodule production clocked in at 23.9 GW and 20.0 GW respectively,representing annual year-over-year growth of around 110%. Bankable,low-cost suppliers such as Trina Solar and Yingli Green Energy recordedgross margins of over 30% for the year, and even smaller, lessestablished players and higher-cost manufacturers enjoyed highutilizations and healthy profit margins.