Wednesday, December 2, 2009

Solar: "Thin-Film Players Feeling Besieged" (FSLR; TSL)

From Greentech:

Executives gathered at a solar conference give pep talks about how to beat back crystalline silicon competitors, who have slashed prices and took business away from thin-film players.

Thin-film solar developers are learning to play the offense and defense these days.

This sentiment set the tone for the first day of a conference in San Francisco Tuesday that focused on thin-film solar technologies, which use little or no silicon to produce solar cells.

These companies have been forced to refine and perhaps revise their sales pitch as they face an unexpected and strong competition from makers of crystalline silicon cells and panels.

"Thin films need to use every advantage to bring electricity costs down and compete with crystalline silicon technologies," said Christian Koitzsch, a managing director of Bosch Solar Thin Film in Germany, at the Thin-Film Solar Summit in San Francisco Tuesday.

Koitzsch noted a reverse of a trend: Project developers and investors who might have given thin films serious consideration have been choosing crystalline silicon solar panels for large, ground-mounted installations instead over the past year.

It's a phenomenon that happened rather quickly. In the past year, prices for crystalline silicon solar panels worldwide have plummeted as much as 50 percent as the recession tightened its grip and Spain, which was the largest market in 2008, experienced a sharp cut in government subsidies and intensified competition in countries that offered more generous incentives.

For thin-film companies, clawing for a bigger slice of a market that is dominated by crystalline silicon solar companies is nothing new. Thin films have been in the minority because many of these companies are developing new technologies and have only recently begun commercial production.

Crystalline silicon solar panels are able to convert a higher rate of sunlight that falls on them into electricity than thin films. The efficiencies for crystalline silicon panels mostly hover in the mid-teens, though SunPower in San Jose, Calif., is producing panels with just over 19 percent efficiency.

The numbers are in the low teens for thin films – many companies are still working on jumping over that 10 percent hurdle. But thin-film developers say the materials they use could produce more electricity under low-light conditions, and their manufacturing costs could be lower.

But the price war presents a big headache, and has prompted the biggest thin-film company, First Solar, to offer rebates in Germany, its largest market, to fend off crystalline silicon opponents (see First Solar Fears Competition From Silicon Panel Makers).

First Solar is better armed to spar with those competitors than most other thin-film companies, however. The Tempe, Ariz.-based public company is the one and only large thin-film company, and it had built up a massive manufacturing operation by the time the market demand for solar slackened....MORE