Bad Times – Solar Equipment Industry To say that Solar Equipment Suppliers to solar panel makers like Trina, Yingli are going through bad times is an understatement. Like the other players in the solar supply chain, major solar capital equipment companies like Applied Materials, GT Advanced Technoloiges, Meyer Burger have seen their revenues and stock […]
Amorphous Silicon Solar Panels were the big rage in 2-3 years ago when the prices of polysilicon the main raw material were touching $500/kg making the mainstream crystalline silicon solar panels very expensive.Amorphous Silicon (a-Si) on the other hand is a non-crystalline silicon which is deposited as an extremely thin layer on glass and other substrates.The cost of the silicon is much lower though the efficiency of solar cells which are made from a-Si is about half of those made from crystalline silicon.Applied Materials with its SunFab turnkey amorphous silicon (a-Si) equipment capitalized on this opportunity, lining up a number of customers with some customer orders in the range of a Billion Dollars.Oerlikon Solar was the other major thin film equipment market winning customers in Europe and China.Sky high poly prices also gave birth to numerous Thin Film startups planning to Manufacture and Use their own equipment rather than selling it .
Solar Thin Film Companies are coming under siege again due to the relentless fall in the prices of crystalline silicon panels in recent months of 2011.Note large number of thin film companies went bankrupt the last time polysilicon prices fell off a cliff in the post Lehman crisis period in 2008 end.Applied Material the biggest solar equipment company killed off its SunFab Division which has a large customer list.Applied Materials saw the writing on the wall and concentrated its efforts on crystalline silicon equipment buying HCT Shaping and Baccini to become a billion dollar supplier of solar equipment.A number of weaker hands in solar thin film went out of business.However the prodigious growth in solar demand in 2010 saw large investments being made again.The biggest failure (not complete yet) seems to be the DOE and Obama darling CIGs startup Solyndra which has already used up a billion dollars with nothing much to write home about .Now Republicans are investigating whether the more than $500 million US government loan was done improperly.Abound Solar a CdTe startup has also managed a $400 million loan and I doubt whether it will manage to ever pay off the loan given that the lowest cost manufacturer of solar panels First Solar itself is under pressure from sharp cost reduction by integrated solar panel companies like Trina Solar.
Meyer Burger (MBTN.S) the 6th largest supplier of solar equipment in the world jumped up 2 places by acquiring the 7th largest global solar equipment manufacturer Roth & Rau of Germany for a little over $500 million.The combined company will have revenues of over $900 million overtaking another Germany company Centrotherm with $825 million in revs.Note Applied Materials continues to be the market leader in the solar equipment market with $1.5 billion in solar equipment revenues just like it is the leader in the semiconductor equipment market.Note while European solar module producers have seen their marketshare and revenues crumbling in the face of the Chinese onslaught , there domination of the solar equipment continues. European Solar Companies had found things going tough in 2009 as the solar market changed radically with the Lehman crisis.As the prices of the raw material Polysilicon crashed and Chinese competition increased,these companies started bleeding red ink in a prodigious manner.The high cost structure of these companies with factories in Europe stood naked against the competition.With high debt loads,there was a high chance that these companies would go bankrupt.Most of them like Q-Cells,REC started to move manufacturing to Asia while Solarworld moved to Europe.
Solar Thin Film Technology has been growing rapidly despite falling costs of the mainstream Photovoltaic Crystalline Silicon Technology.While a number of Weaker Hands in Thin Film have downed shutters,Thin Film Producers continue to grow and expand.The massive growth potential of Solar Energy makes it possible for both of these PV technologies to flourish.Thin Film Technology unlike c-Si has a number of variants.Amorphous Silicon (a-Si),Copper Indium Gallium Sulphide (CIGs) and Cadmium Tellurium (Cd-Te) are the 3 main types of Thin Film Technology.There are a number of manufacturers of all of these 3 types of Technology.CIGs Technology is said to have the most potential in improving efficiency and competing with c-Si,however Cd-Te is currently the top dog as the world’s biggest solar producer First Solar currently uses this technology.a-Si Technology is not that hot with low efficiencies however Oerlikon and Sharp are pushing ahead with developing this technology.Here is a list of the world’s top Thin Film Companies.
With most of the low hanging fruit of polysilicon costs already gone,the industry has to focus on efficiency to cut down on costs.Selective emitters,microinverters,DC-DC optimization and other technologies are already finding takers.A Number of microinverter companies like Tigo,Enphase Energy etc are tying up with global heavyweights like Suntech and Sunpower to increase their penetration and cut costs.National Semiconductor has also tied up with Suntech to integrate its products with Suntech Modules to improve efficiency and reliability.The Balance of Systems costs for Solar Panels and their Performance are not usually paid a lot of attention.But with every cent now making a big difference,these technology could make or break a company in this commoditizing industry.While the value addition and costs of these new products are still subject to market acceptance,its a major change for the industry.This is the next phase in the evolution of the solar energy industry as it looks to additional ways to cut costs and bring solar energy to grid parity.Look for M&A in this space as well since the industry is fragmented with a host of VC backed startups.