Good News for Solar Manufacturers

Solar manufacturers are looking to expand capacity as most of the Tier 1 makers are now running at full utilization and are outsourcing orders. Global demand in 2014 is expected to reach between 40 to 50 GW, which means that the global capacity is about to be breached. Though module prices have not increased, they have also stopped falling, though there have been ups and downs due to trade wars between major blocs.

Tier 1 producers such as Trina Solar (TSL), SunPower (SPWR) etc. are capacity constrained now and running at full tilt. Trina is planning to increase capacity substantially this year, to raise module capacity to 3.8 GW and cell capacity to almost 3 GW this year. They also plan to raise wafer/ingot capacity to 2 GW from 1.2 GW. SunPower will raise capacity by 250 MW next year and they are fully booked out with 1.2 GW of capacity this year. Most solar manufacturers are booked out even though prices have not increased.

Meyer Burger which is one of the biggest solar equipment sellers, has seen its sales increase by 43% in the first half of this year and has seen its book to bill ratio go above 1 after a long time. Other major equipment sellers such as GT Advanced Technologies have also seen an uptick in orders. New higher efficiency equipment is in high demand these days, as manufactures set up capacity in different parts of the world to mitigate the risk of AD and CVD duties being imposed.