The CEO of the biggest solar cell company in the world JA Solar has said that he sees the current vicious industry downturn leading to 90% of all solar companies becoming extinct and a shortage in the market to hit the industry in 2014. However what he left unsaid was that JA Solar might itself become a victim of the industry consolidation which is picking up pace in 2012. Note JA Solar is primarily a solar cell supplier which has been trying to vertically integrate itself by selling branded JA Solar Panels. However the company still has higher overall costs and weaker distribution compared to top solar panel makers like Trina, Yingli and others. JA Solar’s customers which were solar module makers in Europe have disappeared leaving JA Solar to concentrate on acquiring newer solar installer customers.
JA Solar has been hurt by the US imposition of duties on solar cell imports from China which has made companies import from Taiwanese competitors of JA Solar like Motech, Gintech, Neo Solar Power, AUO and Del Solar. Fang Peng predicted that he saw oversupply persist in 2013 as well, with the market going into shortage in 2014. Note another Chinese solar panel producer Trina Solar said that it foresaw 75% of the solar companies going bankrupt.
List of Top Global Solar Cell Suppliers
Crystalline Solar Cell Suppliers are fast disappearing due to the changing dynamics of the global c-Si Solar Panel Industry. With vertical integration becoming imperative as margins and prices get squeezed, independent solar cell suppliers are having a tough time. Increasing raw material costs in terms of higher polysilicon and solar wafer prices and competition from numerous players has decreased the number of pure play solar cell suppliers. However a few of the top solar cell producers continue to grow and flourish though they are also entering into other segment of the PV solar supply chain. Most of the independent solar cell suppliers are from Taiwan and some from China. European solar cell producers have mostly disappeared due to the high cost base of the European factories. Note this list is mostly composed of solar cell producers who don’t have big module making operations. You can find a list of the top solar energy companies most of which make solar cells as well. List of Top Global Crystalline Solar Cell Suppliers – A Disappearing Breed:
1) JA Solar – This Chinese company is not only the biggest solar cell producer in the world but is also the lowest cost one as well. The company has grown much faster than the industry due to its low costs and good quality. The company shipped more than 2 GW of Solar Panels and Cells in 2011 with 50% growth. The company has small wafer and module facilities as well but continues to be primarily a solar cell producer.
3) Motech - The company which used to be a pure play cell producer has expanded into polysilicon, modules and wafers. It is one of the oldest solar cell companies in Taiwan and faced tough times in 2008 post the GFC. TSMC owns a stake in this company.
4) Neo Solar - This is one of the fastest growing companies in Taiwan and has focused on solar cells. It has managed to grow revenues and shipments despite tough competition from domestic as well as international competition.
5) Del Solar - This company is another Taiwanese one with big operations in solar cells like the others. The company is also a new one like Neo Solar and has given strong competition to others like Motech.
6) China SunEnergy - This is a small Chinese Company which primarily engages in solar cell production. However industry cost pressures have made it get into module production as well. It bought 2 small Chinese panel companies in order to survive the onslaught. It has drastically reduced costs in the last one year to become competitive.
E-Ton – This Taiwanese Solar Cell Producer used to be one of the biggest pre 2008, however currently it faces huge headwinds. The company faces financial problems from a US acquisition that went wrong. It was on the verge of selling itself to Foxconn but the deal did not went through.
Note other Solar Cell Producers who sell Modules are Suntech, Trina Solar, Yingli, Sharp are big producers of solar cells as well. Thin Film Technology does not require the intermediate step of solar cell production so there are not thin film cell companies.
Lowest Cost Solar Panel Companies
1) Trina Solar - Trina Solar is one of the lowest cost manufacturers of Solar Panels in the World right now and also sells it at a very low price. This is the reason that the company in a span of few short years has manged to acquire a 10% global marketshare. The prices the solar panels being sold are around $340 per 200 watt module.
2) Solarfun - The Company which was recently acquired by South Korean Chemicals Giant Hanwha also makes one of the cheapest panels and sells it a very low price. The quality is also quite good and with strong parentage behind it, the solar panels made by the company. Again like Trina Solar, it has very low cost Chinese manufacturing capacity. The company also sells at around $1.65/watt.
3) Canadian Solar – The Company sells a wide variety of solar panels unlike other producers. The Solar Panel Selling Price is also quite cheap. The Company is headquartered in Canada with factories in China and Ontario. The Company also sells panels at around $1.7/watt.
75% of Solar Panel Companies to Disappear in 5 years
Solarbuzz which is one of the solar industry’s leading research agencies has come out with some predictions on the Solar Industry for the next 5 years. Note forecasts by analysts and agencies are notoriously wrong in the context of the solar industry which has been seen time and again. In fact, a lot of the research is based on shallow research and inadequate understanding of the fast changing solar market as can been seen in the report by Crisil (S&P subsidiary). However some of the predictions by NPD Solarbuzz are interesting and provide food for thought.
a) A new technology roadmap will appear by 2013 like the semiconductor industry which will help weed out weaker players. Around 75% of the current crystalline silicon solar companies will disappear and only 13 thin film solar companies will exist.
b) Solar Equipment companies will see more M&A, as acquiring solar equipment company makes sense from the technology point of view unlike the solar panel manufacturing sector, where commoditizing and oversupply makes little sense.
c) High efficiency Solar Cells will account for 75% of the market in 2015 from around 18% now.
d) A number of crystalline silicon and thin film solar technologies will disappear as the stronger solar players coalesce around mainstream c-Si technologies.
e) High efficiency solar panels will help in industry consolidation as it makes the gigawatts of low efficiency equipment obsolete.
Though it is difficult to say which of the above predictions will come true, one thing that is certain is that the industry will continue to shift to high efficiency in order to lower costs and a lot of the solar panel technologies will disappear as c-Si technology has become the de facto leader in cost.
Oversupply in the solar energy industry will become worse in 2013 before the industry undergoes a new wave of consolidation that will lead to shortages in 2014-2015, according to Fang Peng, CEO of China-based JA Solar Holdings.
JA Solar, a China-based solar cell maker, was established in Hebei in May 2005. The firm debuted on the NASDAQ on February 7, 2007 with manufacturing facilities in Hebei and Jiangsu provinces.
Fang noted that the worst time for the solar market has not yet arrived and he expects more than 90% of solar firms to face elimination challenges in 2013.
Fang added that most installations in Germany and Italy were completed in first-half 2012 and market forecasts for these markets in the second half are uncertain. Emerging solar markets such as Japan, China and South America will see strong demand, hence global demand is likely to continue growing but prices will continue to fall.
Nevertheless, said Fang, price drops have mainly occurred for upstream polysilicon, solar wafers and cells. In the future, price drops are likely to hit downstream solar modules and systems.
Fang expects solar demand in Japan to grow significantly with the new solar incentives and desperate need for energy.
Japan plans to shut down 54 nuclear power plants by the end of 2012, equaling one-third of total electricity in the country. This will create an energy gap of around 100GW to be fulfilled by renewable energy sources. If 30% of the 100GW can adopt solar with Japan’s sunshine hours, the country will need to install 120GW of solar PV systems. This scale of installation is larger than Germany, said Fang.
Fang added that the current industry does not need evolutionary technology, hence in the short run, thin-film and other substitutes for polysilicon solar products are likely to be marginalized.Google+