Personally I think it just leads to confused [and disappointed -ed] visitors.
Here's a Barron's Feature:
Italy's subsidized solar-energy program has produced a huge boom for big panel makers like First Solar. Unfortunately, it isn't likely to last too much longer.
Italy has found another passion. This time, it's solar energy. At a hearing last month in that nation's senate, regulators reported a subsidy offer for solar-generated electricity had elicited 2½ times more installations than predicted. A flood of applications at the December deadline overwhelmed the energy agency's Website. The sunny southeastern region of Puglia has so many new solar farms that its Ecology Party president is begging for a moratorium. If Italy continues its photovoltaic rush, it will add more solar capacity this year than world leader Germany, and the "feed-in tariffs" paid to Italy's new solar generators will raise the country's electric bills by almost $8 billion.
"Never doubt the greed factor with feed-in tariffs," says Shyam Mehta, a solar-market analyst with New York firm GTM Research. The tariffs guarantee developers an above-market rate for their solar-generated electricity over 20 years.
The makers of all those solar panels had a great December quarter. On Thursday SunPower announced its fourth-quarter earnings had tripled, duly rewarding the hopes that have lifted its shares (ticker: SPWRA) more than 30% this year. Similar year-to-date share gains have been enjoyed by China's Suntech Power Holdings (STP), Yingli Green Energy (YGE) and Trina Solar (TSL), not to mention industry leader First Solar (FSLR). They all have a stake in Italy's market. Higher oil prices and a strengthening euro also helped, but the most frenetic buyers of First Solar may be the bears who had sold short almost 30% of the company's free-trading shares. At 168, the solar pioneer has a market value near $15 billion, which is about 19 times the company's earnings guidance for this year.
Meanwhile, the world's solar manufacturers are aggressively boosting production of just about everything, be it raw polysilicon or the new-fangled panels that use a thin film of copper, indium, gallium and selenium—otherwise known as CIGS. A company called Solar Frontier, part of the big Japanese refiner Showa Shell Sekiyu, is cranking out CIGS products in what will soon be the world's largest solar-panel factory. Solar Frontier's panels will be marketed and financed by General Electric (GE), elevating the thrifty but efficient CIGS technology into a real challenge for crystalline-silicon technology like SunPower's or the thin-film cadmium telluride recipe of First Solar.
The broadening consensus among Wall Street analysts is that global photovoltaic supply might exceed demand by 25% by the end of 2011. As word spread of Italy's solar-cell orgy, and as solar shares soared, a number of analysts downgraded the sector. If a hole opens up next year where Europe's subsidies used to be, they warn that a high-priced stock like First Solar could drop 20% to 25% from its recent height.
"This is a very unsustainable situation," says Joel Silverman, a solar analyst at London's Arete Research Services. When Spain's installations jumped sixfold in 2008, that country capped its subsidies.None
First Solar wouldn't talk to Barron's in the quiet period before it reports December results, on Feb. 24, but the Phoenix-based company's quarter probably went as splendidly as those of its peers. In their latest conference call in mid-December, company executives confidently predicted that revenue would grow by more than 45% in 2011, to about $3.8 billion, producing earnings of about $800 million, or roughly $9.10 a share.
EVEN IF GERMANY'S solar demand shrank 40% in 2011, First Solar would have sufficient revenue from existing European contracts and a two-gigawatt pipeline of projects for North American utilities, said CEO Rob Gillette in the December call. The company boldly plans to invest $1 billion to increase annual production capacity by 50% this year, to 2.1 gigawatts, and by another 30% by the end of 2012.
The newly discovered evidence of Italy's solar spree will surely prompt questions on First Solar's Thursday conference call. Forecasters had expected Italy to install perhaps 1.8 gigawatts of solar power in 2010. Instead, the country's renewable-energy agency, Gestore Servizi Energetici, got 42,000 online applications, 26,000 e-mails and 6,500 registered letters—representing 3.77 gigawatts. With applications still pouring in, the GSE says the nation has already reached the level targeted for 2020.
Power to revise the country's Conto Energia directive lies with Minister of Economic Development Paolo Romani. His ministry may propose some measures to moderate solar spending when it introduces a scheme to meet European emissions standards, around the end of February.
In Germany the Bundestag committee on the environment will debate a plan on Feb. 23 that would increase the level of subsidy cuts in July, if installations continue to run high between March and May. As Europe phases out its feed-in tariff subsidies next year, Silverman expects the solar market to suffer a hard landing.By how much will supply exceed demand? Arete's Silverman has a more generous outlook for global demand than most analysts. But he expects production output to exceed global demand by about 3.5 gigawatts this year, and more than 15 gigawatts in 2012, as solar vendors' exuberant sales to Italy end. "This is all very reminiscent of Spain," he warns. "People are forgetting the lessons of the past."...
Demand By: 2010 2011 2012 Germany 8.0* 7.9 4.5 Italy 5.8 7.3 3.0 North America 1.1 2.5 4.5 Japan 1.0 1.4 1.9 China 0.7 1.6 2.9 Other 4.6 5.1 6.1 Supply Total 19.7 29.4 39.1 Oversupply -1.5 3.6 16.2 *Gigawatts Source: Arete Research
Also at Barron's Features:
Time for a Change in Techland
New Leaders, Fresh Advice
Pricing Power in the Grocery Aisle