The solar
energy industry
experienced the proverbial “perfect storm” of market-changing events in
2009
that redefined the rules of the game, thereby altering the competitive
landscape as well. Starting in late 2008, the solar market shifted from
supply-constricted to demand-driven within a few quarters, due to the
plunging
price of crystalline silicon cells and modules spurred by falling
polysilicon
cost, constrained availability of credit, Spain’s dramatic demand
decline, and
the growth of thin film supply and market share. According to a new
white paper
from Pike Research, while solar demand will experience strong growth
this year,
these events have had a strong influence on which companies will lead
the
industry in 2010 and beyond, and which will face low profit margins and
possible consolidation.
“The solar
market is now faced
with a gross oversupply of modules,” said Dave Cavanaugh, senior
analyst. “The
industry is currently supplied by more than 190 cell and module
manufacturers,
making consolidation of weaker competitors an inevitable outcome.”
In the
meantime, , according
to Cavanaugh, overcapacity and intense competition will create downward
pressure for module average selling prices (ASPs), which will accelerate
grid
parity for the cost of solar-produced power to the 2013 timeframe in
many
markets.
A few of
Pike Research’s other
key forecasts and findings about the new solar market include:
- Worldwide solar demand, driven by lower
costs and greater
availability of credit, will increase to 10.1 gigawatts (GW) in
2010, a
year-over-year increase of almost 43%.
- Solar market demand will exceed 19 GW by
2013, a 25% compound
annual growth rate (CAGR) from 2010; this growth will be driven by
demand
from the U.S., Italy,
and China, in
addition
to steady demand from Germany
and demand growth in a number of smaller countries.
- Excess module supply could easily reach 8.3
GW in 2010, even
accounting for reasonable utilization rates and moderate capacity
growth.
- In 2010 and beyond,
the most important competitive differentiators
for successful solar companies will be: (1) low cost per watt, (2)
module
efficiency, and (3) moving down the supply chain to provide
“one-stop
shopping.”
Call (303) 997-9765 or visit
www.pikeresearch.com for more
information.
