Survey of large US headquartered solar PV manufacturers with a focus on how they are doing in this difficult economic climate of 2009. Comapnies surveyed are: First Solar, SunPower, Evergreen Solar and United Solar Ovonic (Uni-Solar).
In this survey we are looking at the large US headquartered solar PV manufacturers with a view to examine how they are doing in this difficult economic climate. As basically anyone knows, who has not been cloistered away meditating in some cave, 2009 has been a very tough year for pretty much everyone.
Solar companies have been especially hard hit by this global recession because, in the lead up to this recession there was a massive build out of solar PV production capacity – especially by Chinese manufacturers — that would have probably lead to a situation of over capacity in the best of cases. As a result the slacking off of global demand caused by the dry up of the capital markets, recessionary mindset and financial woes of potential consumers of PV products has lead to a severe global glut of PV modules and a global collapse in prices. This may be good for those consumers who have cash in hand, but it has driven many solar companies around the world to the brink, with some notable exceptions.
Not that long ago the US used to dominate the world in solar cell manufacturing and sales, but no longer. While, by some measures First Solar has rocketed to a position of global leadership the US has only 2 – yes just 2 — players in the global top 20 solar PV firms, according to a recent ranking of the top 20 global companies by iSuppli a well known market research company in the semiconductor and solar PV sectors. Companies were ranked according to production in 2007 and by announced production capacity in 2010. The only two US firms that mae it into this top twenty list are First Solar and SunPower.
For related reading check out our post Six US Based Solar PV Equipment Manufacturers to Watch to read about six US manufacturers of the specialized equipment and production lines that are needed to produce solar cells and modules and that are an important segment of the overall value chain of the solar PV sector as a whole.
The list of the big four US solar PV cell manufacturers.
First Solar, Inc., a solar energy company headquartered in Tempe, Arizona designs and manufactures solar modules using a proprietary cadmium-telluride thin film semiconductor technology. The driving force behind its continued profitability and growth is because it has achieved perhaps the lowest manufacturing cost per watt in the industry an enviable position to be in especially in a climate of collapsing solar module prices due to current global oversupply. The company now claims it can produce solar cells at a low cost of $.85/watt for the second quarter of 2009, after also breaking the $1 per watt cost barrier in 2008. This represents a continuing reduction on its production costs and cements its position as the world’s current low cost supplier. First Solar is has grown to become one of the biggest players in the global PV manufacturing sector and is expected to produce an estimated 1,169MW of new modules in 2009 a large increase in output from its 2008 production level of 716MW.
The company prospects continue to rise on recently announced news that it has recently signed a Cooperation Framework Agreement with the Chinese government that takes another step towards the realization of the world’s largest solar power plant – planned to reach a final 2GW of generating capacity and completed in four phases by 2019. The plant is located in the autonomous region of Inner Mongolia, China.
First Solar has grown and is breathing down the neck of Q-Cells of German and Sharp Electronics of Japan for the mantle of the world’s largest solar cell manufacturer with all of them increasing production beyond 1GW/year. On October 15th 2009 First Solar also became the first pure-play renewable energy company to be added to the S&P 500 index.
There is an ominous dark cloud hanging over this rising star’s long term prospects that is related to the specific thin film technology that First Solar has mastered and is riding to success. The element Tellurium essential for First Solar’s cadmium-telluride thin film semiconductor technology is extremely rare in the crust of planet earth. In fact is thirty seven times rarer in earth’s crust than Platinum is where it comprises just one part per billion. For each GW of production of its thin film solar cells First Solar will require more than one hundred tons of Tellurium a figure that is close to the total global production figures (estimates range from a few hundred to around 500 MT of refined Tellurium per year global production).
To read more about First Solar breaking the key psychological price barrier of $1 per watt production cost, see our post: Cost to Produce Solar Cells Brought Below $1 per Watt
SunPower, a solar PV energy company located in San Jose, CA, designs, manufactures and delivers high-performance solar electric systems worldwide for residential, commercial and utility-scale power plant customers. Their high-efficiency solar cells and solar panels generate up to 50 percent more power than conventional solar technologies
The company’s stock has recently been buffeted by news that it may have to restate its financial results for last year and this year because its manufacturing operations in the Philippines appeared to have over and under reported expenses in 2008 and the first three quarters of 2009.
However this is a large solar energy company with a current market cap of over $2 billion and has a deserved reputation for producing high quality modules. In addition its third quarter (2009) revenue was $466 million, compared with $298 in the second quarter, which is a sign that the worst may be over. SunPower will weather this current accounting tempest and is well positioned to survive the current global shakeout and continue to grow in the future. SunPower is hoping to join the GW plus club of manufactures in 2010.
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Evergreen Solar, located in Marlboro, MA and founded in 1994, is a vertically integrated solar PV company that develops, manufactures and markets solar PV products. Key to Evergreen’s success is its patented String Ribbon™, low-cost wafer manufacturing technology, developed at the Massachusetts Institute of Technology that uses significantly less polysilicon than conventional processes.
The company has benefited from substantial subsidies from the state of Massachusetts under the Gov. Deval Patrick administration receiving $58.6 million in state funding assistance to open its new factory at Devens, MA last year.
Evergreen announced on Nov. 4 (2009) that it would be shifting its solar panel assembly work from its Devens, Mass. based facility to a new plant located in Wuhan, China, putting hundreds of local jobs in jeopardy. Evergreen says this move is necessary as a cost-cutting effort due to the current economic climate in the US and a global oversupply problem that has been hurting the entire sector. The Devens facility will continue to make solar wafers and cells. This announcement has understandably caused considerable public outrage in its home state, especially considering the very generous state subsidies that Evergreen benefited from in order to open its Devens facility last year.
Major Wall Street analysts have expressed concern about Evergreen’s liquidity and said the company may have to find new capital soon. The company is driving to reduce its manufacturing costs and has claimed that it has succeeded in bringing the total manufacturing cost to $2.24 per watt, down 17% from $2.70 per watt for the second quarter. Wafer manufacturing cost was approximately $0.75 per watt, down from $0.85 per watt in the second quarter.
United Solar Ovonic (Uni-Solar)
United Solar Ovonic, located in Auburn Hills, Michigan is a wholly-owned subsidiary of Energy Conversion Devices Inc. Ovonics parent company Energy Conversion Devices Inc., is headquartered in Rochester Hills, MI. Scientist-entrepreneur Stanford Ovshinsky founded Energy Conversion Devices, Inc. (ECD) in 1960.
It manufactures and sells solar modules based on a proprietary thin-film triple junction amorphous silicon technology. The PV (solar) laminates it produces are flexible, lightweight and rugged and the company claims that they generate up to 20 percent more electricity than conventional crystalline products for the same investment. They are also easy to install and can be rolled on and bonded to suitable roofing base materials in an easy and simple non- labor intensive operation.
In recent news Uni-Solar has been selected by Recurrent Energy, San Francisco, Calif., to deliver 4.8MWp of solar generating systems for eight separate building rooftops at ProLogis Park Sant Boi in Barcelona and ProLogis Park Alcala in Madrid, Spain.
However Energy Conversion Devices Inc., Ovonic’s parent holding company’s stock is struggling and has fallen 55% so far this year breaking a 52 week low. The market’s perception is that the company has quickly gone from a solar industry cost leader to inefficient laggard and faces a challenging near-term effort to reach cost parity with competitors. This perception is borne out by recent news that Uni-Solar plans to lay off 400 employees, or 20 percent of its workforce. The company seems to be struggling to weather the economic downturn
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