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Sunday, October 21, 2007

Big Growth for Photovoltaics

Solar PV predicted to grow 40% per year

NEW YORK, New York, US, May 16, 2007. Demand for solar PV power will grow 40% per year by 2011, “offering opportunities for investors who can ride out near-term bumps,” according to a report from one of the top investment banks.

“Solar industry profits are here to stay, since both public and government support are likely to remain strong until solar can compete on a cost basis with grid electricity,” says Stuart Bush of RBC Capital Markets and author of ‘Investing in Solar Now.’ “Today, solar energy costs nearly double what would be economical without subsidies, but solar energy companies are aggressively pursuing their Holy Grail: Organic competitiveness with grid electricity.”

Rising costs for fossil fuels, environmental concerns, geopolitical factors and growing demand for energy have swelled global interest in renewables and, with more government subsidies for solar and other green technologies, profitable companies are on the rise in this sector, the report explains. The solar industry is seeing profits throughout the supply chain and silicon cell PV solar technology installations (currently accounting for 95% of the market) will book gross profits of US$7.7 billion this year and grow to $11.5 billion in 2011, the report predicts.

The estimate does not include profits from the alternative thin-film PV technology, which is projected to grow from 6.5% of the market now to 19% in 2011. It also excludes equipment makers and derivative industries.

The solar industry is implementing technology improvements that will continue to drive costs down, and the industry’s installed cost for PV will decline from an average of $7.37 per kW in 2007 to $4.40 in 2011. The industry will achieve organic competitiveness with grid electricity at $3.50 per kW, without incentives and depending on the region by 2012 - 2014.

The long-term outlook for solar power is positive but sector stocks are likely to remain volatile in the near term, it warns. RBC has developed a supply and demand forecast model that predicts solar companies are likely to experience tightening margins over the next few years, driving vertical integration and capacity consolidation, particularly among new silicon producers, smaller cell and module producers and independent installers.

Given the industry's evolution, investors should consider key investment strategies for the emerging global solar industry, Bush suggests. Solar companies that focus on high value-added elements of the supply chain (silicon, wafer and cell producers) will generate higher margins than labour-heavy and low barrier-to-entry module and installation segments. As the majority of the solar industry is dominated by standard solar products, companies with higher efficiency products or lower-cost thin-film designs are better suited to command superior profits long term.

As additional silicon supplies drive raw material costs down over the next two years, operating cost structure will emerge as the long-term driver of profit margins and producers in Asia (most notably in China) stand to benefit, it adds. Investing among companies located in Germany or China will limit exposure to cross-border macro trends and highlight comparably strong regional producers.

RBC Capital Markets is the investment banking arm of the Royal Bank of Canada.

Photovoltaic Business in U.S.

PV prices increase in U.S.

WASHINGTON, DC, US, October 15, 2007.
The shipment of solar PV cells and modules in the United States has increased almost ten-fold in the past decade, including a 50% jump from 2005 to 2006.

Data from the Department of Energy show that total shipments in 1997 was 46,354 kW (peak), of which 1,853 kW were imports and 33,793 kW exports. By 2005, total shipments were 226,916 kW (90,981 imports, 92,451 exports), rising to 337,268 kW last year (173,977 imports, 130,757 exports).

The number of companies involved in the U.S. PV industry was steady at 20 from 1997 to 2004, when it increased to 29 in 2005 and 41 in 2006, DOE’s Energy Information Administration explains in its annual report on PV manufacturing activities. The data does not include shipments of cells and modules for space/satellite applications.

Of the 337,268 kW, the largest type (44%) was cast & ribbon at 147,892 kW, up from 64,239 kW (35%) in 2004. Single-crystal silicon represented another 25% (85,627 kW), down from the 52% share of shipments only three years earlier. Thin-film was 30% (101,766 kW), up from 12% in 2004, while concentrator accounted for the final 1% (1,984 kW).

Prices for cells and modules continue to climb in the U.S., with the average price of cells last year at US$2.03 per peak watt (down from 2.17 in 2005) but modules prices at $3.50 (up from $3.19 the year prior). Single-crystal modules averaged $4.09 while cast & ribbon were $3.66 per watt. Data for thin-film and concentrator silicon were not released to avoid disclosure of proprietary company data.

Installers provided the largest distribution last year at 146,948 kW (34,779 in 2004), followed by wholesale (126,101 vs 106,400), module manufacturers (9,635 vs 11,868), retail distributers (7,086 vs 5,140), exporters (4,188 vs 2,354) and end users (3,092 kW in 2006 vs 1,029 kW in 2004). For end users, electric generation was accounted for 274,197 kW of grid interactive and 18,003 remote, 6,888 for communication, 4,030 for consumer goods, 2,438 for transportation, 2.093 for water pumping, and 6,132 kW of cells/modules to OEM.

The number of companies involved in the solar PV manufacturing industry in the United States was 41 in 2006, compared with 21 in 1997, while employment (Person-Years) grew from 1,736 to 4,028 last year. Total revenue for complete PV systems was $193 million last year, compared with $39 million in 2004.

“This may be a sign of confidence from investors as well as the solar energy industry itself about the future of the solar energy market,” the report explains. “This outlook is supported by the Renewable Portfolio Standard (RPS) policies of some western states (Arizona) requiring that a certain portion of the RPS be solar-based.”

Of the 130,757 kW exported out of the U.S., Germany was the largest destination at 80,583 kW (62%), with Spain 15,241, Portugal 6,605, China 4,403 and South Korea 4,021 kW comprising the top five.
The PV industry is actively promoting new products, with 14 companies expecting to introduce new crystalline silicon products this year and six companies planning to introduce new thin-film products to the industry. Four companies plan to produce new concentrator photovoltaic products, and many companies engaged in the manufacture or import of PV modules and cells say they are involved in other PV-related activities.

The answer to global warming is here now

Best Solar Homes: German Team Wins Solar Decathlon

ScienceDaily (Oct. 20, 2007) — The Solar Decathlon challenged 20 college and university teams to compete in 10 contests and design, build, and operate the most attractive and energy-efficient

The Solar Decathlon’s homes are zero-energy, yield zero carbon, and include the latest high-tech solutions and money-saving benefits to consumers, without sacrificing comfort, convenience, and aesthetics. Each house must also produce enough “extra” energy to power an electric vehicle. Many of the solar power and building technologies showcased on the National Mall are available for purchase and use. Teams have worked for more than two years designing, building and testing their homes – the Solar Decathlon is the culmination of that work.

The ten contests that decide the Solar Decathlon measure many aspects of a home\'s performance and appearance. A perfect total score for all ten contests is 1,200 points.

First Place: Technische Universit├Ąt Darmstadt

This team from Germany came to the Solar Decathlon hoping to have an impact on people, and it\'s safe to say that this happened. Darmstadt won the Architecture, Lighting, and Engineering contests. The Architecture Jury said the house pushed the envelope on all levels and is the type of house they came to the Decathlon hoping to see. The Lighting Jury loved the way this house glows at night. The Engineering Jury gave this team an innovation score that was as high as you could go, and said nobody did the integration of the PV system any better. Darmstadt was one of seven teams to score a perfect 100 points in the Energy Balance contest. All week, long lines of people waited to get into this house. Total points - 1024.85

Second Place: University of Maryland

At the beginning of the week, people wondered if the Maryland team would have a home-field advantage because they are so close to Washington, D.C. As the week progressed, and Maryland won the Communications contest and was second in Architecture, Market Viability, and Lighting, it became clear that Maryland didn\'t need any advantage. The Communications Jury praised their excellent Web site and house tour. The Architecture Jury said the house definitely belonged in the top tier. The Lighting and Market Viability juries also had high praise. They were one of seven teams to score a perfect 100 points in the Energy Balance contest. Total points 999.807

Third Place: Santa Clara University

This team wanted to build a sustainable solar house that is functional, elegant, and innovative—and they did just that. The Communications Jury lauded their friendly, enthusiastic house tour, which was informative, entertaining, and very much "on target" for public audiences. They were one of five teams to score a perfect 100 points in the Hot Water contest and one of seven teams to score a perfect 100 points in the Energy Balance contest. Their house almost didn\'t make it to the Solar Decathlon, because their transport truck broke an axle and delayed them by three days. Total points 979.959

Adapted from materials provided by Department Of Energy.