Solar industry strategies rerouted by market conditions
SCOTTSDALE, USA: Thin-film (TF) solar panels, most notably the cadmiumtelluride panels made by First Solar Inc., have solidly establishedthemselves as offering a lower price-per-installed watt thantraditional solar panels made using silicon wafers.
The 876megawatts of TF modules sold in 2008 is expected to grow to 5.2gigawatts in 2013, a compound annual growth rate of 43 percent,according to a new 2009 report from IC Insights, Solar Energy: Growth Opportunities for the Semiconductor Industry.
Withthis growth, the TF share of total solar photovoltaic devices sold willincrease from 14 percent in 2008 to a forecast 27 percent in 2013,according to the report (see Fig. 1 below).
WhileTF is expected to continue gaining share, the Solar Energy report showsthe forecast rate of growth is significantly lower than many recentsolar industry forecasts. There are a number of factors behind thisprediction.
TF panel makers have struggled to push panelefficiencies above about 11 percent, despite research-lab devices withefficiencies ranging from 16-20 percent. These higher efficiencies havebeen difficult to achieve in volume production, and there is littleindication so far of a breakthrough in this regard.
Thus,despite their lower cost per watt, TF panels are predominantly used inlarge-scale ground based utility installations, where a large amount ofspace is available. In almost all rooftop applications, panels madewith silicon-wafer-based solar cells are more attractive because theirhigher efficiency, ranging from 14-21 percent, means that more powercan be generated for a limited rooftop area.
The political cloutof electric utilities will undoubtedly draw government dollars towardlarge-scale solar installations. However, the Solar Energy reportsuggests that it is arguably the best use of solar technology todistribute small arrays on rooftops, close to the point of powerconsumption, where it reduces the costs and power losses associatedwith transmission and distribution lines. The better governmentpolicymakers understand this, the better the incentives should be forsolar suppliers with the best rooftop products.
The Solar Energyreport goes on to show that after several years of stellargrowth—capped by a 99 percent growth year in 2008—the solar industry isbeing slammed during the current economic downturn.
ICInsights believes that after a 22 percent drop in installed megawattsof solar PV capacity during 2009, strong growth will return in 2010, asnew government incentive programs gain traction in the US, Asia, andEurope. But with weakened government support during 2009, seriouslylean conditions are driving solar device makers to re-evaluate andre-tune their strategies for increasing the value they can deliver perdollar.
A big factor coming to the aid of wafer-based cellmakers is a big increase in available polysilicon supplies in 2008,2009, and 2010. Freed of the capacity constraints for wafers and withsilicon costs dropping, wafer-based solar cell makers will concentrateon improvements in device design and manufacturing techniques thatallow them to drive device efficiency up and cost-per-watt down.Several suppliers have said that they will be bringinghigher-efficiency cells to market, including a number of newback-contact cell designs.
Other key findings in Solar Energy: Growth Opportunities for the Semiconductor Industry:
*Pricing for solar panels will take a big step down in 2009, and thenreturn to moderate decreases in price per watt over the remainder ofthe 2009-2013 forecast period.
* Competition is great amongsolar PV suppliers, with the top supplier in 2008 holding only 9percent of the market, and 13 other suppliers each with 4 percent ormore. IC Insights expects supplier rankings to continue to change.
*Solar-grade polysilicon will remain in oversupply throughout theforecast period. New sources of lower-cost supplies, such as upgradedmetallurgical grade (UMG) silicon, will help drive down wafer costs.
*Equipment suppliers to the new solar device industry must re-tune theirbusiness as device makers struggle with ballooning inventories andplummeting capacity utilization.
Solar Energy: GrowthOpportunities for the Semiconductor Industry was written to helpcurrent semiconductor manufacturers and suppliers gain a clearerunderstanding of solar technology and markets as they considerexploiting existing and upcoming opportunities available in thefast-growing solar PV sector.
It contains five-year forecastsfor photovoltaic cells, solar modules, PV pricing trends,semiconductors in solar systems, PV-production capacity, capitalexpenditures, and polysilicon sales for PV cells. Regional markettrends along with profiles and ranking of the industry’s top 15photovoltaic device suppliers are also covered in the new report.
Single-usercopies of the 118-page report sells for $2,975 with each additionalcopy priced at $495. A multi-user corporate license is available for$5,880.
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