Access to capital is a growing entry barrier inthe photovoltaic industry, with the caveat that access to capital alone is insufficient to compete. As the cost of establishing and maintaining a competitive PV business increases, the ability to convince investors or parents to commit capital will be critical. Capital commitment will not only determine business direction; it will dictate business survival.
Industry cycles are not creating a positive atmosphere for investors. Solar-grade silicon supply, quality, and pricing are limiting scale-up and driving down yield. Manufacturers are now looking at thin films as a potential solution, but high-yield thin-film production in volume has yet to be established to meet the growing market demand.
Over the next ten years, investment will be needed in three key areas for PV cost reduction to continue: increased capacity and automation, solar-grade silicon supply, and development and promotion of sustainable markets. Without an investment in each area, market growth and cost reduction will slow down. Sustainable market development will involve market education, increasing low-interest financing in the industrialized world and creating financial mechanisms and infrastructure in the developing world. As capital requirements increase, the importance of the strategic business decisions are magnified. Specific business development plans will need to be formed with near- to mid-term profitability as the common denominator.