- The company's CIGS-based product will offer "silicon efficiency at thin film costs."
- Stion has demonstrated 14.1 percent efficiency on full-size panels with its single-junction product.
- Stion is currently producing 2-foot-by-5-foot panels at 120 watts to 130 watts for all solar sectors.
- The firm has a roadmap to 15 percent efficiency.
- Farris also claimed that Stion can get to market in "half the time and with one-tenth the money."
GreentechSolar
Text of Commerce Dept. Ruling on China Solar Trade Tariffs
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Here's a reprint of the fact sheet just issued by the Department of Commerce on the preliminary decision on the anti-dumping complaint from SolarWorld. (Click on the images to enlarge.)
Solar Industry Reaction to the Anti-Dumping Decision
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Shyam Mehta, Greentech Media's Senior Solar Analyst:
- While the margins are not as high as those seen in many previous U.S.-China antidumping cases (electrical blankets, steel grating), they are certainly much higher than Chinese manufacturers would have hoped for. Stacked onto the margins for countervailing duties, they amount to levels of 35 to 36 percent, which is significant.
- Keep in mind that this is a preliminary decision. We expect Chinese manufacturers and CASE representatives to contest the findings in days ahead.
- The margins were obviously driven in part by the DOC's choice of the "proxy economy" to estimate costs, as China is considered a "non-market economy".
- At these margins, China-based manufacturers would certainly have to raise U.S. prices to turn a profit. It is not feasible for them to maintain prices at tariff-free levels and still be profitable. In the short-term, this is likely to lead to module price increases in the U.S. which would serve to dampen demand and installation growth. If the Chinese were to absorb the tariff, it would place their costs close to parity with many U.S.-based suppliers.
- However, Chinese firms are hardly likely to stand still. Broadly speaking, they have two strategies: set up cell manufacturing outside China, or use the tolling services of Taiwan-based suppliers to turn wafers into cells there, and then assemble the modules in China. Both strategies would allow the Chinese to bypass import tariffs. We estimate that tolling cells to Taiwanese firms would increase Chinese costs by 6 to 12 percent, which is meaningful but manageable.
- Given this, we do expect that the decision will result in at least incremental investment in domestic manufacturing by Chinese firms. However, there are other, lower-cost manufacturing locations that these firms could set up manufacturing in, such as Mexico and Taiwan, for example that would still allow them to price their modules below that of U.S.-based suppliers. Therefore, we see the impact of this decision on U.S. manufacturing as positive, but spurring limited investment in the future and likely only temporary relief for existing U.S.-based suppliers.
Suntech (NYSE: STP): "These duties do not reflect the reality of a highly-competitive global solar industry. Suntech has consistently maintained a positive gross margin as revenues are higher than our cost of production. We will work closely with the Department of Commerce prior to their final decision to demonstrate why these duties are not justified by fact," said Andrew Beebe, Suntech's Chief Commercial Officer. "As a global company with global supply chains and manufacturing facilities in three countries, including the United States, we are providing our U.S. customers with hundreds of megawatts of quality solar products that are not subject to these tariffs," continued Mr. Beebe. "Despite these harmful trade barriers, we hope that the U.S., China and all countries will engage in constructive dialogue to avert a deepening solar trade war. Suntech opposes trade barriers at any point in the global solar supply chain. All leading companies in the global solar industry want to see a trade war averted. We need more competition and innovation, not litigation," continued Mr. Beebe.
Yingli (NYSE: YGE) “We felt validated after the Department of Commerce’s preliminary CVD decision in March, which determined that we are not being substantially subsidized as the petitioners claim. Today’s preliminary anti-dumping tariff recommendation was not unexpected given the historical tariff levels in these types of cases. We will continue to aggressively defend ourselves and remain optimistic that we will persevere in the final determination,” said Robert Petrina, Managing Director of Yingli Green Energy Americas, Inc., the Company’s operating subsidiary in the U.S. “The overwhelming majority of the U.S. solar industry supports access to affordable solar energy and fair market trade. We are grateful to the tens of thousands of U.S. solar installers, developers, manufacturers, and suppliers who stand behind us today.” “As we’ve stated before, tariffs are disruptive and destructive for the entire solar industry,” said Mr. Liangsheng Miao, Chairman and Chief Executive Officer of Yingli Green Energy. “We remain fully committed to serving the U.S. market irrespective of the outcome“The verdict is in,” said Gordon Brinser, president of SolarWorld. “In addition to its preliminary finding that Chinese solar companies were on the receiving end of at least 10 WTO-illegal subsidies, Commerce has now confirmed that Chinese manufacturers are guilty of illegally dumping solar cells and panels in the U.S. market. We appreciate the Commerce staff’s hard work on this matter.”
Brinser further stated, ““Commerce today put importers and purchasers on notice about the consequences of importing illegally subsidized and dumped products from China. We understand U.S. Customs and other federal agencies are already aggressively enforcing the countervailing tariffs in order to prevent circumvention, and we expect they will be equally vigilant with the anti-dumping tariffs.”Tom Hecht, president of SCHOTT Solar, which produces solar PV panels in Albuquerque, NM: “The solar industry has been awaiting today’s decision from the U.S. Department of Commerce – and for good reason. U.S. project developers and investors need clarity and confidence to make critical supply decisions. Today’s decision brings clarity – but creates another issue for U.S. developers. As they look to keep projects on track over the next three to four months, many will be trying to close on sources for PV panels not subject to the new tariff structure,” said Tom Hecht, President of SCHOTT Solar, which manufactures Buy-American compliant, high quality PV modules in Albuquerque, N.M. “SCHOTT has over 50 years’ experience in solar. With factory sites in the U.S., Europe and Asia, SCHOTT Solar has been preparing to supply modules to our customers without interruption, regardless of the government decision." Hecht also noted, “Longer term, the U.S. solar industry and government must focus on energy policies that will provide long-term certainty to the market and continue to encourage investment. Now is the time to support the industry in its efforts to create energy security for our nation and create additional jobs in manufacturing and services.”
Rhone Resch, president and CEO of the Solar Energy Industries Association (SEIA): "The solar industry calls upon the U.S. and Chinese governments to immediately work together towards a mutually-satisfactory resolution of the growing trade conflict within the solar industry. While trade remedy proceedings are basic principles of the rules-based global trading system, so too are collaboration and negotiations. Importantly, disputes within one segment of the industry affect the entire solar supply chain--and these broad implications must be recognized. In addition, the U.S. solar manufacturing base goes well beyond solar cell and module production and includes billions of dollars of recent investments into the production of polysilicon, polymers, and solar manufacturing equipment, products which are largely destined for export. If the U.S.-China solar trade disputes continue to escalate, it will jeopardize these U.S. investments. Given these broader implications, it is imperative that the U.S., China, and other players in the dynamic global marketplace work constructively to avert or resolve trade disputes that will ultimately hurt consumers and businesses throughout the solar value chain."
Canadian Solar CEO Shawn Qu: “Canadian Solar is disappointed by today’s decision from the DOC. Imposing an obligation to post large bonds on solar imports at this preliminary phase of the antidumping investigation is unwarranted and will inflict losses on the entire solar industry. Limiting trade in solar products will cause panel prices to increase, defeating America’s goal of driving down costs and hindering its move toward a clean energy future. Our first priority should be to support the health of the industry as a whole through the financing and installation of solar, which is the key driver to expanding jobs in the US solar market.”
Jigar Shah, the President of CASE, stated, “Today SolarWorld received one of its biggest subsidies yet – an average 31 percent tax on its competitors. What’s worse, it will ultimately come right out of the paychecks of American solar workers. Fortunately, these duties are much lower than the 250 percent tax that SolarWorld originally requested. This decision will increase solar electricity prices in the U.S. precisely at the moment solar power is becoming competitive with fossil fuel generated electricity.”
“At the same time, CASE recognizes that today’s decision is ‘preliminary.’ Between now and a final decision before the end of the year, there are many issues that will be addressed and whose resolution would lead to a significantly lower tariff. CASE will continue to fight SolarWorld’s anti-consumer and anti-jobs efforts to ensure a better result for America’s solar industry,” continued Shah.
According to Kevin Lapidus, Senior Vice President Legal and Government Affairs for SunEdison, “The U.S. solar industry has been growing, adding new solar electric systems, creating jobs and investing billions of dollars in the U.S. energy infrastructure. By increasing the price of modules and therefore the price of solar energy, these tariffs will undermine the success of the U.S. solar industry and reduce the ability of solar energy to compete with electricity generated from fossil fuel.”
Ken Button, co-founder and President of Verengo Solar, stated, “As the second largest residential solar company in the country, Verengo has helped thousands of middle class families save money during tough economic times by installing solar. Because our customers are very price sensitive, today’s decision to increase costs for solar cells and panels will make it harder for American families to access solar.”
Tore Torvund, CEO of REC Silicon, with 500 solar jobs in the United States, commented, “This decision is short-sighted in the extreme and a severe setback for President Obama’s clean energy program with its goal of expanding the use of solar and other renewables. Further, we are very concerned about the increased likelihood that China will retaliate with their own tariffs on polysilicon exports from U.S. producers such as REC Silicon. Triggering a solar trade war is not in the best interests of the U.S. solar industry or its customers.”Tom Gutierrez, CEO of GT Advanced Technologies, with another 500 solar jobs in the United States, stated, “Today’s Department of Commerce decision subsidizes a German-owned company to the tune of an average 31% tax on its competitors and potentially harms U.S.-headquartered companies like GT Advanced Technologies, Dow Chemical, REC Silicon and MEMC. Ultimately, protectionism fosters dependence and high-cost business models, rather than the innovation and agile approaches required for companies to succeed in the global marketplace. Now is the time for the U.S. solar industry to move forward with the development of advanced technologies that create jobs and enhance our energy security—in spite of this new barrier. American solar manufacturing can compete without special protections.”
Jesse Pichel with Jeffries Group Inc., “Environmentalists and the unemployed should be equally disappointed with this decision because lower cost solar panels make solar more competitive with dirty fossil fuels. It should be clear by now that there are more U.S. jobs on the installation side of the solar business than on manufacturing. These cases have a chilling effect on business and it will linger for a long time. It’s unfortunate that SolarWorld has taken this scorched Earth approach and that they are distracting from the growth of U.S. jobs and affordable solar energy.”
Breaking News: Commerce Dept. Chinese Solar Panel Dumping Verdict Is Now In
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Although the official pronouncement has not been made, we've learned from sources close to the case that the Commerce Departments's preliminary decision on SolarWorld's solar dumping petition against China has been handed down in a case that had the potential to rock the U.S. solar market's status as an emerging growth market.
Here are the preliminary tariff numbers in the anti-dumping piece of the case:
- Suntech: 31.22 percent
- Trina: 31.14 percent
- Everyone else: 31.18 percent
In short, China solar manufacturers have been accused of unfair trade practices in subsidizing solar panel manufacture and selling panels in the U.S. below their cost. Cheaper Chinese solar panel pricing has been a boon for consumers and solar installers, but a competitive challenge for the few crystalline solar manufacturers in the U.S.
SolarWorld accuses Chinese firms of dumping. Others suggest that China has a legitimate cost advantage. For the purpose of AD investigations, dumping occurs when a foreign company sells a product in the United States at less than fair value.
On March 20 of this year, The Department of Commerce's preliminary verdict on unfair subsidies for Chinese solar panels was handed down, along with what amounted to low tariffs for the Countervailing Duties (CVD). The preliminary determination indicated the DOC’s intention to impose a duty of 4.73 percent on U.S. imports from Trina Solar, 2.9 percent from Suntech, and 3.59 percent from all other remaining Chinese manufacturers.
The AD (Anti-Dumping) tariffs will be added to the CVD (Countervailing Duties) tariff.
The CVD tariffs are retroactive. We're waiting for word on the AD duties and whether they are retroactive.
Gordon Brinser, president of Oregon-based SolarWorld Industries America, had this to say: “This is a bellwether case. It underscores the importance of domestic manufacturing to the U.S. economy and provides a clear indication of whether our country will be a global competitor in clean technologies or outsource them to China. The Commerce Department has already determined that the U.S. solar industry has been harmed by China flooding the market with illegally subsidized goods, and we are in need of relief that counts.”
Clyde Prestowitz, president of the Economic Strategy Institute, added this: “The president has said he will insist on a level playing field for U.S. industry and has said that America always wins when the playing field is level. Well, this week is the week when the administration must decide how to respond to China's industrial policy for solar panels. This decision will tell us whether Obama means business or whether all the activity around the creation of a trade enforcement unit is just a mirage.”
An anti-dumping tariff of 30 percent together with the CVD tariff could mean a difference of roughly $0.30 per watt on solar panel prices. Chinese module manufacturers could ship cells and modules through Taiwan at a cost of $0.06 to $0.08 a watt, which might help Taiwanese solar cell makers like Neosolar or Motech.A report from The Brattle Group looked at 50-percent and 100-percent tariff scenarios and found that a 50-percent tariff will effectively shut the majority of Chinese imports out of the U.S. and result in a job loss of 15,000 to 50,000 -- even accounting for production gains in the U.S. The report also considers the impact of Chinese retaliation in importing polysilicon, which could result in a loss of 11,000 jobs in 2012, for a total of up to 60,000 jobs lost by 2014. The author of the report did acknowledge that there would be some gains among U.S.-based module producers -- albeit at higher module prices.
The Center for American Progress (CAP), a left-leaning think-tank, put out a release yesterday that considered if the "U.S. solar market would be much better off if SolarWorld would drop the petition and allow the U.S. government to negotiate a private solution with China." Their analysts' take was that "if U.S. companies drop trade petitions in response to China’s real or implied threats, then capitulation wins out over negotiation -- and capitulation is a losing game. As a result of this proposed balancing exercise, CASE expects that a bilateral negotiation would result in much lower tariffs (compared to what the U.S. Department Commerce might impose) or a price floor, possibly in exchange for Chinese promises to reduce or eliminate the contested subsidies. But such a balanced outcome is highly unlikely, either in the case of the solar industry or in the many other cases in which U.S. companies face unfair Chinese trade competition."CAP concludes that the U.S. cannot capitulate to China’s solar market ambitions.
Hari Chandra Polavarapu of Auriga Research released a research note on the trade case, saying, "We have written extensively on this issue as part of industry debate and our viewpoints largely converge with Gordon Brinser/CASM that the insidious and predatory nature of Chinese state support (via subsidies, mispricing/misallocation of capital) has emasculated global solar PV manufacturing while propping up its large domestic base, which is littered with uncompetitive/unviable companies. Free of rules, China's state-sponsored capitalism in solar PV manifests as a massive employment welfare scheme engaged in asymmetric/unrestricted warfare against overseas competition."Note that these tariffs and decisions are preliminary and can be decreased, refunded or increased in a final review by the Commerce Department.
Net Energy Metering and the Fight for Solar’s “Backbone” Policy
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A decision at the California Public Utilities Commission (CPUC) on May 24 could determine the future of distributed generation (DG) and, especially, of rooftop solar in the state.
The decision involves two questions, a legality explicitly before the commission and an implied dispute between the state’s three investor-owned utilities (IOUs) and renewables advocates.
California has a net energy metering (NEM) program that allows owners of distributed generation systems of up to one megawatt in capacity, like small wind turbines, combined heat and power systems and rooftop solar systems, to reduce their electricity bills.
For the kilowatt-hours they send to the grid, system owners’ meters turn backwards as they are credited at the same retail rate they pay for the kilowatt-hours they consume.
When California established its NEM program in 1995, it imposed a 0.1 percent cap but used the ambiguous language of “aggregate customer peak demand” to define what the total megawatts of net metered systems should be divided by to calculate the cap percentage. And that calculation remained undefined, even as the CPUC expanded the cap to today’s 5 percent.
The differing methods used by the IOUs to calculate the bottom term of the cap equation, and the differing percentages thereby obtained, were recently observed by the Interstate Renewable Energy Council (IREC) which, among its other activities, acts as a watchdog group on U.S. net metering programs. IREC filed a motion asking the CPUC for clarity. Commission President Michael Peevey issued a proposed decision April 5.
In it, he noted the legislature had “several goals” in creating the NEM Program, “including encouraging substantial private investment in renewable energy resources and stimulating in-state economic growth.”
He pointed out several differences in how the IOUs calculate the percentage of their NEM, but noted one key commonality: PG&E, SCE and SDG&E all use “coincident” peak demand. Renewables industry advocates argue vehemently in favor of “non-coincident” peak demand.
Coincident peak demand is the designated period when all sectors (residential, commercial and industrial) reach their maximum electricity consumption together. It is the time period when the state’s consumption peaks.
Non-coincident peak demand is the sum of the peaking demand in the sectors. Residential peak is typically late afternoon, commercial peak is early mid-afternoon, and industrial peak can be at night. It is a larger number because that sum of peaks at different time periods is greater than the total peak demand at any one time of the day.
The installed DG capacity eligible for NEM is the same. Dividing it by the peak demand number gives the cap percentage. When that number gets to 5 percent, the utilities are theoretically off the hook. So they want that bottom number to be smaller. Renewables advocates want just the opposite. As long as the number doesn’t get to 5 percent, renewables developers have what one called their “backbone” incentive in place.
The question before the CPUC is the intent of the law. Here’s what Peevey wrote: “The phrase 'peak demand' is used to refer to coincident peak demand in multiple occurrences in the Pub. Util. Code. [...] The words 'aggregate customer' would be superfluous if the Legislature had intended 'aggregate customer peak demand' to mean coincident peak demand. [...] Use of the phrase 'aggregate customer peak demand' in § 2827 of the Pub. Util. Code to mean coincident peak demand when the phrase 'peak demand' is used elsewhere in the Pub. Util. Code for that purpose would constitute the use of inconsistent and confusing terminology by the Legislature.”
These observations led Peevey to conclude that “The Legislature did not intend 'aggregate customer peak demand' to mean coincident peak demand. […] It is reasonable to interpret 'aggregate customer peak demand' as meaning the aggregation of individual customer peak demands, i.e., customers’ non-coincident peak demands, [... and] SCE, SDG&E, and PG&E should use the aggregation of customers’ non-coincident peak demands to calculate their caps on NEM participation.”
In comments filed by their attorneys, the IOUs dispute these conclusions. PG&E wrote that “the best choice for the denominator for calculation of the 5 percent cap is the highest peak ever achieved in the utility service territory. […] For PG&E, at least to date, this was 20,883 megawatts reached on July 25, 2006.”
PG&E’s filing also complicates the basic dispute by suggesting a change in the way the top number is calculated, concluding, “PG&E estimates that reversing these two decisions would reduce the amount of generation that can fit under the cap by about 10 percent, although the exact amounts will vary depending on participation in each group. PG&E recognizes that this means more net metering. However, [... it] is the better measure of the impact on the grid.”
By raising the issue of the impact of renewables on the grid, PG&E opened the door to the implicit debate between the IOUs and renewables advocates.
The utilities point out that of the three parts of the standard electricity bill, only one covers the price of electricity generated. The other charges cover the costs of delivering electricity through the transmission and distribution infrastructure. When NEM customers’ bills are reduced by the retail rate, they escape paying their fair share of costs for infrastructure they use as much as non-NEM customers.
And, the utilities say, it shifts costs to other ratepayers.
More on the costs and benefits of NEM in the next installment in this series.
Solexel, Still in Solar Stealth, Scores $25 Million From KP, Westly, et al.
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Getting later-stage VC funding for a photovoltaic module company with an unproven technology can't be easy. It might barely make any sense to launch a startup in the current solar market, either.
But Solexel, a Milpitas, California-based solar firm still in stealth, just closed on a $25 million C round, according to an SEC filing.
The firm has raised funding from Kleiner Perkins, Technology Partners, DAG Ventures, The Westly Group, EcoFin, Spirox, Oakhill, Univest, and Northgate Capital, closing a $15 million A round in 2007, an undisclosed B round in 2008, and some additional funding from The Westly Group in 2010. The company looks to have more than 100 employees. The CFO, Jonathan Michael, is the former CFO of Solyndra.
The firm also received a $13 million Sunshot grant in its Extreme Balance of System Hardware Cost Reductions section, along with partner Owens Corning, to "develop a building-integrated PV roofing shingle and installation accessories for residential sloped-roof applications."
Solexel received about $3 million in DOE incubator money in late 2008 with this description:
Solexel plans on commercializing a disruptive, 3D, high-efficiency mono-crystalline silicon cell technology, while dramatically reducing manufacturing cost per watt. At the end of this project, Solexel plans to deliver a 17-percent to 19-percent efficient, 156x156 mm2, single-crystal cell that consumes substantially less silicon per watt than conventionally sliced wafers.
In any case, it seems that Solexel falls in the very-thin-silicon, kerfless-wafer school along with Twin Creeks, AstroWatt, SiGen, Crystal Solar and 1366.
Last August, we reported that Solexel, the former Soltaix, was scouting out manufacturing sites in Malaysia's Senai Hi-Tech Park to build a multi-gigawatt-capacity photovoltaic cell manufacturing plant. The company will be in the business of building solar modules, according to a conversation with Ryan Brown, Director of Corporate Development at Solexel, in an otherwise uninformative phone interview.
The firm's LinkedIn blurb says its "approach is based on a disruptive, IP-protected, high-efficiency technology which reduces silicon consumption by a significant margin compared to the current paradigm and substantially eliminates dependency on the silicon feedstock, ingot, and wafer supply chain. Active cell area is made through the use of plentiful, inexpensive silicon gas, as opposed to costly bulk silicon wafers."
Judging by the NREL disclosures and patent information, Solexel is or was also working on an epitaxial lift-off scheme using Porous-Silicon-Process (PSI process) technology licensed from the Max Planck Society, as well as some 3D wafer features, including prisms and a "honeycomb" array.
Here's the patent for three-dimensional solar cells with honeycomb prisms. Here's a patent for manufacturing three-dimensional thin film silicon solar cells. And here's a patent for releasing a thin film substrate from a reusable semiconductor template. Here are links to some other Solexel patents. Most of the patents are invented by Mehrdad Moslehi, the founder and CTO of the firm.
One of Greentech Media's solar analysts was able to determine this about the firm: "They are similar to Crystal Solar in that they are depositing crystalline silicon via the gas phase onto a reusable substrate with a release layer (probably porous silicon)" but Solexel is "trying to save the cost of texturing by growing the light trapping texture into the "wafer" itself by having a substrate with a pyramid-like surface topography."
When Solexel was formed, solar modules were selling in the neighborhood of $4.50 per watt. Today you can buy a reputable brand's module for less than $1.00 per watt.
This is the new solar landscape that Solexel is going to have to play in -- a landscape the firm and its investors might not have imagined when it was first formed.
Gen110, Energy “Concierge” to the Solar Household, Gets Funding From KP
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Third-party-financed residential solar -- offering homeowners rooftop solar at no cost, then reaping the benefits of tax incentives and economies of scale -- is all the rage these days. California saw third-party solar outpace homeowner-owned solar for the first time last year, with contenders like SolarCity, SunRun, Sungevity, Clean Power Finance, OneRoof Energy, and others vying for the new market.
It appears that cheaper power bills for little or no money down is an attractive offer for many homeowners. But could new approaches open the market up even further?
Gen110, a San Francisco startup with 70 employees, 11 offices in California and about 2,000 customers for its solar-backed energy bill reduction service, says yes -- if you can pick out the right customers. On Thursday, Gen110 announced an investment of undisclosed size from Kleiner Perkins Caufield & Byers to expand its “energy concierge” concept to broader markets, along with unspecified “business development support” from the big green venture capital firm.
It also announced that it will be using SunPower panels, and SunPower's financing program, in projects in California's Central Valley, adding the high-efficiency PV maker to a list of partners that includes solar financing startup SunRun and roofing and solar installer PetersenDean.
The startup works with solar installers, developers and financiers on the customer engagement side of the business, from picking out the right customers to target to getting them to sign up for a long-term relationship to lower their energy bills, CEO Jason Brown said in a Wednesday interview.
“We’re not a solar company; we’re a distributed energy company,” he said. Gen110 has partnered with big third-party solar players, but it’s also looking at future applications of on-site combined heat and power systems, energy storage and other technologies that could provide homeowners their own power, Brown said.
That’s because Gen110’s main relationship with its customers is as an energy services company of sorts, he said. The startup’s core IP resides in analyzing the world of potential customers in a market -- in this case, California -- and picking out those that pay higher bills. Those are typically owners of larger homes, though Brown said there’s a mass market for the service as well, as long as you pay about $120 or more per month for electricity.
From there, Gen110 hits those customers with a marketing and customer service experience that includes home visits to lay out just how a no-cost solar array -- whether via a power purchase agreement, financing plan, lease or another structure -- could reduce the customer’s power bills, not just today but in the future, he said.
These customers represent fresh markets for the solar industry, which has depended so far on targeting so-called “green” adopters, rather than doing market analysis to identify economic needs, Brown said. He wouldn’t provide much more in the way of details on the “big data” analysis that goes into this process, saying that it’s a core part of Gen110’s intellectual property.
Gen110 makes money via revenue-sharing agreements with its partners, Brown said. That could include energy efficiency service providers and others interested in ways to isolate and target customers who stand to see the most economic benefit in being sold a third-party-financed project or system, he noted.
Typical savings add up to about $50,000 over 20 years, he said. But while some customers want to get involved in how much they’re saving, a good deal of them just want to get a cheaper, fixed rate for power and leave the rest in Gen110’s hands, he said. The startup is concentrating on California right now, though Brown said it could expand to other states and regions.
Just how Gen110’s offering will fit into the ecosystem of third-party solar developers remains to be seen. Flagship third-party solar startup SolarCity, which took the top spot for U.S. residential solar market installation in the first nine months of 2011, certainly spends a lot of money targeting and marketing, and so do its competitors. The proof in the concept will no doubt lie in whether or not Gen110 can land more partners like SunPower to use it.
Guest Post: Top-Tier Chinese Solar Firms Have a Legitimate Cost Advantage
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Tomorrow, the U.S. Department of Commerce will announce its preliminary determination on the issue of whether Chinese solar manufacturers dumped crystalline silicon photovoltaic cells and modules into the U.S. market. But it’s important to understand that, irrespective of the alleged dumping, China’s top-tier solar manufacturers do have a legitimate cost advantage over U.S.-based solar manufacturers. China’s solar manufacturers are winning for good reason: they’re more competitive than their American counterparts.
Before I get into why that is, I want to stress two points: First, Chinese manufacturers could have developed this advantage on the back of illegal subsidies from the Chinese government (though Commerce found evidence of only small subsidies). Second, the fact that China’s manufacturers have a legitimate cost advantage does not necessarily mean they haven’t dumped product into the global market.
So who cares, then? Well, it’s important to separate fact from fiction in trade cases like this. It is very easy to point a finger at China as the bad guy, but that doesn’t help anyone. It has the potential to damage the U.S.-China trade relationship (and remember, it has been in part because of low-cost solar cells and modules from China that U.S. solar installations have boomed in the past years). Blaming China also takes the spotlight off of U.S. manufacturers and U.S. policymakers -- and what they can and should be doing to keep American solar manufacturers competitive in this global economy.
NREL study grossly misrepresented
Most of the arguments against the cost competitiveness of China’s top-tier solar manufacturers have relied on a presentation by Alan Goodrich at the National Renewable Energy Laboratory (NREL). The oft-espoused line is this: the NREL study proves that Chinese manufacturers have a 5 percent cost disadvantage compared to U.S. manufacturers when the cost of shipping from China to the U.S. is included. But that was, in fact, not the conclusion of the study at all.
Anyone who actually saw Goodrich’s presentation, not just the PDF slide deck, knows that Goodrich was not comparing a solar module assembled in China from solar cells made in China to a solar module assembled in the U.S. from solar cells made in the U.S. Instead, he was comparing the cost of a solar module assembled in China from solar cells made in China to the cost of solar module assembled in the U.S. from solar cells made in China. He was making the case for a manufacturer like Suntech to make its cells in China then ship them near to the U.S. location of the end customer and assemble the cells into modules there. (Which is, incidentally, exactly what Suntech does.) Watch the video and see for yourself.
China’s cost advantage: 18 percent to 30 percent
Goodrich did compare the cost of a China-made solar cell to the cost of a U.S.-made solar cell. And he found that the Chinese cell manufacturer has a core cost advantage of 18 percent to 20 percent over the U.S. manufacturer. That advantage comes largely from scale and vertical integration; Goodrich compares a 60-megawatt plant in the U.S. to a 2,000-megawatt plant in China. That scale and integration gives China’s manufacturers a 10 percent discount on all materials (“due to supplier leverage and captive production strategies”) and a 50 percent discount on equipment from Chinese equipment vendors. Labor costs are certainly much lower in China, but labor only makes up about 5 percent to 10 percent of the cost of a module, and U.S.-based manufacturers make up for higher labor costs with more highly automated plants.
An 18 percent to 20 percent cost advantage is in line with what I’ve heard from a number of other analysts and industry experts. Greentech Media’s own Shyam Mehta told me in an interview that the cost differential between U.S. and Chinese manufacturers is about 25 percent to 30 percent in 2012. Rob Wanless, Director of Business Development at SOLON Corporation, said that the cost of solar panels from Chinese manufacturers is about $1 per watt, and $1.20-1.30 per watt from U.S. manufacturers. One executive at a Chinese module manufacturer similarly suggested that China has about a cost advantage of about $0.20 per watt on modules and about $0.10 per watt on cells.
Keeping this debate to the actual facts is critically important, in no small part because the stakes of this trade case are so high. Perhaps even more important, misrepresenting the facts takes the heat off of U.S. manufacturers and policymakers. Spending their time blaming China for the U.S. solar industry’s woes allows policymakers to deflect discussions about what they need to be doing to help U.S. manufacturers stay competitive. We all know that the solar industry is but one example -- if the U.S. can’t figure out a way to compete here, the long-term prospects for American manufacturing are dim indeed.
Learn more about the source of China’s cost advantage and other facts behind the U.S.-China solar trade case (and listen to interviews with Gordon Brinser and Jigar Shah) at www.chinaglobaltrade.com.
***Molly Castelazo is the director of ChinaGlobalTrade.com, where she coordinates the development of content packages on key China trade-related issues to fulfill the organization’s mission of promoting fact, challenging misinformation, and infusing balance into the dialogue. Molly holds dual degrees in economics and political science. She began her career in the research department at the Federal Reserve Bank in St. Louis.
Thin Film Manufacturing Prospects in the Sub-Dollar-Per-Watt Market
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This is the first piece in a three-part series exploring thin film's place in today's solar market from the author of GTM Research's latest report, Thin Film 2012–2016: Technologies, Markets and Strategies for Survival.
No other PV technology has seen as many false fits and starts or held as much promise as thin-film PV. During the height of the polysilicon bottleneck between 2004 and 2009, thin-film PV’s prospects seemed unparalleled. Shipments of thin film grew from a paltry 68 megawatts in 2004 to 2 gigawatts in 2009 -- a compound annual growth rate (CAGR) of 97 percent. By the end of 2009, thin film commanded 18 percent of the total market with no signs of slowing, unless one properly read the polysilicon tea leaves.
Spurred by spot polysilicon prices that blew beyond $400 per kilogram, thin-film solar startups quickly amassed coffers combining to total nearly $3 billion of publicly announced private investment by the end of 2009, peaking at $1.1 billion in 2008. Recipients were almost exclusively Silicon Valley CIGS startups, with names like Solyndra, Nanosolar, and MiaSolé depositing the biggest checks. By late 2009, a new presidential administration had freed public debt financing for solar projects and manufacturers through the Department of Energy (DOE) Loan Guarantee Program. The first loan went to cylindrical CIGS manufacturer Solyndra for a total of $535 million. By the end of the program in 2011, the DOE had loaned nearly $1.3 billion for solar manufacturers, of which $1.1 billion was allocated to thin-film solar manufacturers.
FIGURE: Venture Capital Investment into Thin Film PV Through 2009
Source: Thin Film 2012–2016: Technologies, Markets and Strategies for Survival (GTM Research)
While thin film continued to grow to 3.7 gigawatts in 2011, cheap crystalline silicon dominated the industry conversation from 2010 onward. Market share of thin-film PV dropped to 11 percent. Chinese commodity PV was the new drug of choice, and for the first time, the words “bankable” and “Chinese” were uttered in the same breath. Leading Chinese manufacturers blew past the gigawatt scale and entered into the industrial age of solar production. While the initial growth patterns coupled with new feed-in tariffs swept all parts of the solar value chain to new heights in 2010, by the beginning of 2011, the party had quickly turned into a hangover.
FIGURE: Historical Thin-Film PV Production, 2002-2011
Source: Thin Film 2012–2016: Technologies, Markets and Strategies for Survival (GTM Research)
Flash forward to our current industry environment, where suppliers are meeting the market with wavering optimism to deep-seated paranoia. “Emerging markets” are the new hot term, with conversations feeling out the demand markets in non-traditional markets like South America, South Africa, and Southeast Asia -- not out of curiosity but out of desperation. As European demand flattens and more importantly, the oversupply of cheap c-Si continues to test the market, thin film manufacturers have been left in the dark.
In the last nine months, bad news has dominated the thin-film PV segment. Solyndra made the biggest splash when it declared bankruptcy and defaulted on its $535 million Department of Energy Loan Guarantee. But political theater aside, several other thin film firms have rolled back manufacturing plans, including many thin-film silicon companies delaying capacity expansion and others like Abound Solar ceasing production and retooling for a recovering demand market. Even industry leader First Solar has had to slowly roll back its capacity, first eliminating its CIGS research division, delaying its Arizona facility, scrapping plans in Vietnam and finally closing its Germany facility and indefinitely idling Malaysia capacity. With production guidance from First Solar ranging between 1.5 gigawatts, 1.7 gigawatts in 2012 total production would drop by over 10 percent year-over-year.
We’ve heard it a million times already: skydiving crystalline silicon module prices, especially from Chinese module manufacturers, have crushed margins and forced once-promising technologies and companies into crisis mode. Module pricing has dipped below the once-storied target of $1 per watt (dc) and the main question for thin-film PV manufacturers is “How far will -- or rather, can -- crystalline silicon prices fall?” With polysilicon prices (as forecasted by GTM Research) tightening to $20 per kilogram, coupled with improved polysilicon yields and cell efficiencies, does thin film stand a chance? With only roughly 10 thin film manufacturers above 100 megawatts of year-end capacity as of late 2011, is the window closing on thin film manufacturers' ability to cobble the fragments of their promise into a compelling value proposition?
FIGURE: Module ASPs versus c-Si and TF PV costs
Source: Thin Film 2012–2016: Technologies, Markets and Strategies for Survival (GTM Research)
The answer is, perhaps surprisingly, yes -- at least for some industry players. While the crushing module pricing environments have dashed the hopes of many small thin film manufacturers, large corporations see distressed assets and investors desperately searching for an exit. In the past year, venture capital has recovered slightly from 2009 lows, and early 2012 investments are still strong. While year-to-date totals hover around $125 million, investments have reflected reduced market potential, with rumors that Nanosolar and MiaSolé both took large hits from once-lofty valuations in their latest rounds.
FIGURE: VC funding into thin-film PV through 2012 YTD
Source: Thin Film 2012–2016: Technologies, Markets and Strategies for Survival (GTM Research)
While outright buyouts have been rare in thin film, GE’s acquisition of Primestar last April and Tokyo Electron’s February purchase of Oerlikon Solar are the tip of the iceberg. Already, major Asian investors have begun to dabble in thin-film PV investments, testing the waters for a bigger play. Recent thin film investments by Asian industrial conglomerates include Hyundai Heavy Industries’ JV with Saint-Gobain’s Avancis division in Korea, including an initial 100-megawatt facility; AVACO and TSMC’s play in Stion and their subsequent Korean and Taiwan manufacturing plans using Stion’s technology; SK’s $50 million dip into HelioVolt; TFG Radiant’s 39 percent ownership in Ascent Solar and planned Asian manufacturing that could be worth up to $275 million for Ascent; and Mitsubishi Heavy Industries’ MOU with Taiwan Oerlikon Micromorph® customer Auria Solar. Other quieter CIGS research and development efforts are being carried out by LG, AUO and Samsung, with Samsung on the active hunt for a big move in the space (we hold strong that MiaSolé would be an attractive fit).
Are these investors simply playing into the pied piper of thin film pipe dreams, or is there a secret sauce that will carry thin film across the finish line? In part two of this series, we will investigate the underlying cost structure of thin film manufacturing and question whether efficiency gains will be enough to bring thin-film PV to competitiveness.
Stion Is Having a CIGS Solar Sale
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Stion is having a CIGS solar panel sale.
The VC- and strategic-funded CIGS solar firm sent out an email blast offering solar modules "for as low as $.75 per watt." Neither the email nor a a subsequently contacted representative of the company disclosed the volumes available or the terms of the offer for modules at that price. Aaron Thurlow, Stion VP of West Coast Sales, did say that these were fully UL-compliant modules shipping from Stion's Hattiesburg, Mississippi factory.
As GTM Research Solar Analyst MJ Shiao has discussed in his recent thin film market analysis, thin film vendors have a small window of opportunity to be competitive -- but the firms have to get their factories running at capacity to realize the cost promise of the technology. And having this type of sale is one way to get it done.
In December of last year, in the largest photovoltaic funding round of 2011, San Jose, California-based Stion raised $130 million in private equity, led by AVACO and Korean private equity funds. The firms's existing investors -- Khosla Ventures, Taiwan Semiconductor, Lightspeed Venture Partners, Braemar Energy Ventures and General Catalyst Partners -- also participated in the funding round. The firm is expanding manufacturing capacity in its Hattiesburg, Mississippi facility, as well as opening a Korean manufacturing subsidiary.Lead investor in this round AVACO is a supplier of thin film processing equipment.
Stion's module are monolithically produced on glass, and the firm has achieved 14 percent efficiencies in early production. The firm has a tandem design in the works and has licensed its technology to Taiwanese foundry TSMC.
In an earlier interview, Chet Farris, the CEO, had claimed:
Thurlow told GTM that Stion is ramping a 100-megawatt line in its 500-megawatt factory and modules with efficiencies of between 11.5 percent and 12 percent are now shipping, with 13 percent targeted for the end of the year.
Source: GTM Research report Thin Film 2012 to 2016
Consolidation Chronicles: Sovello Joins the List of German Solar Insolvencies
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Sovello, based in Bitterfeld-Wolfen, not far from Q-Cells, cannot pay its debts and has asked the Dessau insolvency court to restructure under its management, the company said in a release on its website yesterday.
In early 2010, Sovello, the Q-Cells-Evergreen-REC joint venture, then on the verge of bankruptcy, was sold to German private equity firm Ventizz Capital. The firm's Evergreen/Q-Cells/REC provenance does not bode well for its future.
German photovoltaic panel manufacturers are faced with reduced feed-in tariffs, increased competition from China, and a global oversupply of solar modules.Sovello joins Germany's Q-Cells, Soltecture, Odersun, Solar Millennium, and Solon in the group of the country's extremely troubled or shuttered PV manufacturing firms. Q-Cells was Germany's -- and once the globe's -- largest solar manufacturer. It is now on the brink of bankruptcy.
As Shyam Mehta has said, "'Consolidation' is a nice word that refers to a lot of ugly things.”