Tuesday, March 30, 2010

"The Future of Thin Film: Beyond the Hype" (FSLR; GE)

From Greentech:

2002 - 2008: The Promise

From only 17 MW in 2002 to 966 MW in 2008, thin film's rise over the last decade has been remarkable indeed. Fueled by the greatest success story in the PV industry -- cadmium telluride producer First Solar -- the technology has captured the imagination of industry participants and interested observers alike. First Solar represents the disruptive potential of thin-film PV in full: high throughput (1,011 megawatts in 2009), competitive efficiency (11%), and an industry-leading cost (currently 83 cents per watt), enabling significant profit (the only pure-play solar company to be listed on the S&P index)....

...2009 - 2010: Trials, Tribulations

Or so the hype went. As of 2010, only one other company besides First Solar -- triple-junction amorphous silicon firm United Solar -- has produced in excess of 100 MW annually. The cost structure of most amorphous silicon, considering its low efficiency, is barely competitive with crystalline silicon, and CIGS producers have encountered technical issues in manufacturing that have forced them to delay commercial production since 2007. To make matters more difficult, capital constraints made banks and developers shy away from thin film in favor of more mature and abundant crystalline silicon modules for projects in 2009. First Solar aside, one would have to admit that the results have yet to live up to the talk. As Asian crystalline silicon PV producers continue to ramp down costs and increase capacity beyond the gigawatt level, the question must be asked: will results ever meet expectations, and if so, when? In other words, will thin film fulfill its potential and make meaningful inroads into the solar energy landscape, creating new markets in the process? Or will it be relegated to a bit-player role in the growth of the global PV market?

2010 and Beyond: Inching Towards Inflection

As detailed in GTM Research's just-published report Thin Film 2010: Market Outlook through 2015, assessing thin film's impact on the global PV market in the years ahead requires an understanding of the factors that influence demand for this technology, and of how these factors interact when determining technology selection in PV markets. After a comprehensive analysis of more than 160 manufacturers, extensive data collection, and analysis that spanned three months, it is possible to trace the evolution of key aspects of the industry over the next three years. The following set of insights emerges as a result.

1. Thin film capacity will exceed 10 GW by the end of 2012. Thin film manufacturing capacity grew from just 349 MW at the end of 2006 to over 4.4 GW by the end of 2009, more than doubling every year, which reflected the attractiveness of investment in thin film due to the impact of the polysilicon shortage during that time. From 2010 onwards, the rate of expansion is expected to slow significantly; this reflects more sober plans in the aftermath of global oversupply, low consequent capacity utilization, and the lack of financing. Still, there will be over 10 GW of thin film capacity by the end of 2012, and there is room for upside adjustment if demand grows faster than expected. Amorphous silicon is expected to constitute a dominant majority at 5.65 GW, while CdTe and CIGS will have roughly even capacity share at 2.47 GW and 2.11 GW respectively.

2. Best-practice producers across all technologies will achieve costs of 80 cents per watt by the beginning of 2012, but there will be significant variation across producers. The figure below displays forecasted module costs for the beginning of 2012. CdTe costs are expected to drop to about 70 cents by this time. While possible tellurium price spikes present some risk to these numbers, the threat is limited by a thinner film and higher feedstock utilization from efficiency gains. In the case of amorphous silicon, it is expected that single-junction technology will hit its practical efficiency ceiling (8% to 8.5%) for many producers by 2012, and will start getting phased out thereafter. Tandem-junction, which just began to spread its wings in 2009, will take its place and become more representative of the a-Si market, at 10% efficiency. Costs for these technologies are expected to range from $0.80 to $1.20 per watt. CIGS should show an exponential improvement in costs from 2010 to 2012, due to the commercialization of high-throughput manufacturing through roll-to-roll processes by a few producers. For these firms, costs could be as low as 80 cents a watt. On the other end, smaller fabs that persist with glass substrates could be up to 50% more expensive, at $1.25 per watt....MUCH MORE

Watch Out First Solar: "GE outlines R&D efforts with CdTe thin-film technology" (FSLR; GE)
First Solar, PrimeStar Solar and Cadmium Risks (FSLR; GE)
GE sees solar becoming $1 bln business
GE's Immelt reduced to whining after homicidal rant from Jack Welch (GE)
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