sMa
European and Chinese renewable energy firms are
lining up to build production and research facilities
in the United states.
Foreign Firms to Build U.S. Factories Japanese companies have long maintained factories in California. Now European and Chinese renewable energy firms are lining up to build production and research facilities in the United States. In October alone, companies an- nounced these moves: SMA ( sma-america.com), a world leader in inverters, announced a $23 million assembly plant in Denver, its first factory outside Germa- ny. The company said it would hire 700 workers and begin shipping Sunny Boy, Sunny Island and Sunny Central inverters meeting U.S. specifica- tions by mid-year. The goal is to supply up to 1 gigawatt of inverter capacity annually. China-based Suntech ( suntech-power.com) announced plans for a 100,000-square-foot ( 9,290-square-meter) assembly plant near Phoe- nix. The facility will build modules from cells
made in China, with shipments beginning in the
third quarter of 2010. The company says a work-
force of 150 will produce about 30 megawatts of
modules annually and generate about $37 million
in sales. That’s $1.23 per watt.
Germany’s Mage Solar ( magesolar.de)
planned to announce in late November an
American location for its new module factory.
Sites were under consideration in five states.
The firm expects to begin shipping its Power Tec
silicon modules early this year. The company
also sells inverters and racking systems under
its own brand.
Siemens ( energy.siemens.com) erected
a 2.5-megawatt prototype wind turbine, with
a rotor diameter of 101 meters (330 feet), at
the National Renewable Energy Laboratory’s
National Technology Center near Golden,
Colo. The German company announced plans
to establish a permanent research center in
Boulder, Colo., to employ 40 engineers and
other staff by 2013.
By last September, according to figures compiled by the European trade paper PV Magazine, the
average wholesale price for silicon modules from
China had fallen below about $2.60 per watt, down
43 percent from $4.56 per watt a year earlier. Silicon
modules from Europe and Japan had dropped below
$3.05 per watt, down 37 percent in a year from $4.85 per watt.
“It’s a dramatic slide,” said Chris O’Brien at Oerlikon Solar (oerlikon.
com), a manufacturer of machine tools for thin-film module production. His customers are planning to make modules for 70 cents per watt
by the close of 2010, which implies a wholesale price of around $1 per
watt — long a goal for thin-film firms like market-share leader First Solar
( firstsolar.com).
The price plunge is a complex matter. In part, it’s based on a “
correction” in the supply of polysilicon ingots, the raw material for silicon
photovoltaic (PV) modules. In 2008, the stuff was in short supply and
sold for up to $500 per kilogram. “That has been corrected now,” says
Eric Peters, global vice president for solar at Dow Corning (dowcorning.
com), the world’s largest supplier of polysilicon. When new polysilicon
foundries came on line, supply doubled and the price fell to around $200
per kilogram. At the same time, the credit crisis and recession flattened
demand.
If that were the complete story, factories would have cut back on
production. Instead, they’re working full blast and even accelerating
their output. To meet demand by PV factories, Dow Corning plans for
a 30 percent increase in production during 2010. On top of that, the
Prices Plunge,
and Industry
Braces for Boom
company has broken ground for a new factory to
produce monosilane for use by thin-film factories.
Peters expects the company to be a world leader in
that market from 2011 onward.
Why would factories worldwide continue to fill
warehouses with unsold modules? Because they’re
scrambling to play in the U.S. market, which they predict will boom
over the next five years (see page 22 for what this means for American
installers). And why will it boom? Because incentives are up and prices
are down. In many localities, incentives and rebates now cover almost
50 percent of residential system costs. Combine that with a 30 percent
drop in module pricing, and installed costs can fall to less than $5 per
watt. At that rate, in a state with high electric rates and good incentives,
payback can fall to five years or less — a psychological tipping point for
many consumers.
Installed prices can go even lower as costs fall for labor, racking and
inverters. “The drop in module prices creates a huge demand and will
drive balance-of-system costs down,” says Raghu Balur, vice president
of marketing at Enphase ( enphaseenergy.com), a start-up microinverter
manufacturer. Enphase shipped 100,000 units in its first 12 months and
expects to double production this year. At Solar Power International
2009, the company showed the prototype of an AC solar module, a PV
module with the microinverter embedded in its back. With a fold-out
rack system, that product could be lifted onto a roof, bolted down and
plugged into the service panel in an hour. And that’s the near future.
— Seth MaSia
