Read a perspective on South Africa-based solar startup PTiP’s CIGS pilot line announcement at http://www.spvmarketresearch.com/notes-from-the-solar-underground.html

Read about it at http://www.spvmarketresearch.com/announcements-and-industry-news.html

Stay informed, read about mining in Panama — potential for remote and grid connected solar for reliable power as well as discussions to change EU climate change mandates to goals at http://www.spvmarketresearch.com/announcements-and-industry-news.html

Whether 2013 was a good or bad year for the solar industry and all of its technologies and participants is a factor of personal perspective as well as the vagaries of memory.  For manufacturers enjoying a return to positive gross margins low cost raw materials (polysilicon) are to be celebrated but for producers of raw materials low prices are hardly celebratory.  While many manufacturers are enjoying recovery of a sort, past leading manufacturers, such as Q-Cells and Suntech fell from great heights ending in soft, to not so soft, to very hard landings. Feed in tariffs rules changed (sometimes retroactively) or ended and tender bidding forced margin constraints on large developers.  The lease model and its potential for high profits (once the hardware is paid off) drove solar deployment in the US residential sector, at least for now.  Vertically integrated PV cell/module manufacturers committed more module product to the system sides of their businesses (as good a way as any to avoid selling technology below cost).  

As 2013 ends and top ten lists, including predictions for 2014 continue popping up, a short look back is in order. In order of publication in the Solar Flare bi-monthly report, some moments of note from the Solar Flare, (feel free to write in to SPV Market Research with some of your own):

Solar Flare February 2013 Issue:

• US flexible CIGS manufacturer, SoloPower (Oregon) announced a restructuring.
• China-based crystalline cell and module manufacturer Hareon announced an initial $50-million investment in a 600-MWp manufacturing facility in Mexico.  Doing the math, at $0.08/Wp this is either one good investment or, the facility is unlikely to be built or, there is more money for this project somewhere.
• News leaked that the PPA for First Solar’s Macho Springs installation was $0.06. No comment.
• Mexico based module assembler Solartec announced that it had acquired Belgium based crystalline manufacturer Photovoltech and planned to dismantle and move Photovoltech’s manufacturing facilities to Mexico, leading to the question: did I hear that correctly? Nonetheless, if countries in the Latin America region are serious about deployment it will be far less costly to be serious about manufacturing at the same time.
• California’s CSI program reached its limit ahead of its 2016 deadline.

Solar Flare April 2013 Issue:

• The US DoE announced funding of $7-million for projects on Indian lands. (Comment:  Though some US Indian tribes have casino generated wealth, many are poor and could benefit from the construction jobs that come along with deploying solar as well as well as the potential revenue stream from system ownership and finally from the availability of reliable and clean electricity.)
• US based CPV manufacturer Amonix announced a record CPV module of 34.9%
• China based crystalline manufacturer JA Solar announced commercial production of its monocrystalline (19.6% conversion efficiency) and multicrystalline (18.1% conversion efficiency) MWT cells. 
• US-business based SunPower (manufacturing in the Philippines and Malaysia) announced US availability of its X Series modules using its Maxeon Generation 3 cells (~24% conversion efficiency).
• CPV Manufacturer Soitec finalized a ~$100-million bond to finance its 44-MWp installation in South Africa.  Doing the math, this is $2.27/Wp.
• Among a host of almost monthly bad news for former top ten crystalline manufacturer China based Suntech, the company closed its US (Arizona) module assembly facility, founder Dr. Shi was replaced as CEO and South Korea based OCI (polysilicon) cancelled its long term supply contract.  Unfortunate news for Suntech plodded on through 2013. 
• US based flexible CIGS manufacturer Solopower shuttered its Oregon manufacturing facility leading to a flurry of reporting about the similarities between Solopower and Solyndra as well as many references to CIGS technology being both promising and new.  There are no similarities between Solopower and Solyndra.  Yes, CIGS/CIS remains promising. Though commercial shipments of CIGS/CIS began in the late 1990s, early 2000s, the technology is ~20 years young.
• US based (with manufacturing in Malaysia) CdTe manufacturer First Solar announced it had acquired US based crystalline manufacturer TetraSun also noting that it would begin commercial shipments in 2014. 
• Jinko and Yingli announced loans, (likely under favorable terms), with China’s Development Bank

Solar Flare June 2013 Issue:

• K Road Power LLC cancelled its 294-MWp Calico project that was to be located near Barstow California, had switched from CSP to PV and was acquired from Tessera Solar.  (Comment: Hopefully this proves that announcements about deployments, among other things, are not sure things until construction (not just a fence) has begun and just possibly not even then.
• Utility Hokkaido Electric Power in Japan rejected 1.2-GWp worth of applications for FiT solar installations.
• With amazing efficiency, Italy’s FiT reached its cap and the government announced the ending of its program in July 2013. 
• The Government of Ontario, Canada replaced its large FiT program with a bidding system, proclaiming the move as the way to get even more solar installed.
• Romania made changes to its FiT program to control growth.
• Spain reduced subsidies for renewable technologies – again – by an additional 20% thus ensuring that no one will likely make any money from the country’s brief, briefly profitable but long term painful FiT.
• The EU imposed tariffs on Chinese imports
• The WTO ruled in favor of the few remaining EU based manufacturers over Ontario’s domestic content requirement in its not-exactly wildly popular FiT.
• Hopefully surprising no one, Greece announced retroactive reductions to its FiT.
• Taiwan based TSMC (licensed Stion’s CIGS technology) announced a champion module efficiency (this means not in production) of 15.7% for its CIGS technology.
• Japan based Solar Frontier announced 14.6% conversion efficiency for a champion cell developed on production equipment.
• Taiwan based cell manufacturers DelSolar and NeoSolar finalized their merger and will hopefully live happily ever after. 
• Canadian Solar announced its commitment (~50% of its future revenues) to its system business, a perfect example of an announcement that is essentially meaningless but does get people talking.
• Hemlock filed a $96-million lawsuit against Isofoton. Ouch.

Solar Flare October 2013 Issue:

• The EU and China agreed on a 0.56 Euro/Wp price for modules imported from China as well as a limit on imports.  Immediately following the heralding of the announcement countless (meaning too many to count) ways around the set in stone requirements were found and implemented.
• The Netherlands announced it would close five coal plants – now this is an announcement worth making.
• SolarCity, continuing its acquisitive ways, acquired mounting company Zep Solar.
• IKEA announced that it would include China-based Hanergy’s CIGS module kits in its UK stores, by which they, of course, mean they will do so when these kits are commercially available. 
• In California Governor Brown signed SP43 requiring investor owned utilities (IOUs) to install 600-MWp of solar above the state’s 33% RPS on environmentally disadvantaged or economically disadvantaged areas with system sizes limited to <20-MWp. Also in California, AB327 required the CPUC to develop a new standard for commercial and residential net metering as well as monthly fees and new electricity rates.  (Comment: Even given potential pushback from ratepayers, two giant steps forward towards the way solar will be valued in the future given that in the future the current paradigm will be restructured to favor self-consumption, wider use of renewables and the use of the utility grid as backup storage. Utilities should get on board now with ownership of solar assets and the renewable community should help them. )

2013 was another year of triumph over the significant obstacles and constraints that remain in the path of the solar industry and all of its participants – yes triumph, despite everything progress in the face of significant obstacles is a triumph worth celebrating. 

Recognition of climate change and the various government announced commitments to ameliorating it are simply not moving fast enough to retard the damage already done and ensure against future damage.  Real progress in this regard will require a herculean effort to change the minds and hearts of energy consumers everywhere that conservation is not sacrifice, that renewable technologies provide real independence and that though the switch will be costly, it is far less costly than the alternative of climate disaster.

Time is the primary difference between a fad and a trend.  Fads are fleeting. Trends develop overtime altering behavior in some relatively permanent fashion.  The adverb relatively is used as permanence has become, over time, far less permanent.  Fads ebb and flow more quickly than trends.  The best way to tell the difference, unfortunately, is in hindsight. For example, the European FiT model is responsible for jump starting the utility scale (or multi-megawatt) application for solar technologies.  The initial highly profitable FiTs attracted investors who, forever in pursuit of the holy grail of safe investments, encouraged demand and supply side solar participants to build ever larger installations.  Initially, many long time solar participants believed that demand for multi-megawatt installations (particularly for PV) would reach a peak and decline, likely along with the profitable FiTs. Instead this trend appears to be here to stay – for better or worse, or, for profit or not-so-profitable.  Another example, turnkey equipment sales, appears to have been a fad that faded away relatively quickly – that is, in solar years.  Just as dog years are longer than human years and often used as a metaphor for the slow passing of time, solar years are also longer than human years.  To gauge the length of a solar year observe announcements and the accompanying timeline creep from announcement, re-announcement and fruition. 

Five potential trends and the likelihood of continuation or cessation are:

Potential Trend 1: Merchant systems:  These systems may or may not be multi-megawatt and are sold without a PPA or tender and potentially without an incentive.

Why this may not become a trend:  The high upfront cost of installation, no matter how low component prices go, is a roadblock to many potential system buyers.  Moreover, in many countries it is illegal to set up an independent utility from which electricity is sold.  To become a trend laws would have to change and/or deep pocket customers must be found and cultivated. 

Why this may become a trend:  Utilities understand the efficiency of owning the means of production. Once they become more comfortable with solar in terms of the variability of its resource it will make sense to control it because of a) its free fuel b) low maintenance c) positive PR afforded the utility and d) return of control over profit.  Mining concerns are often remote and require reliable power; solar is a long term investment that when combined with storage (yes too expensive still) or another power source (hybrid) offers a long term answer to energy requirements.  Finally, should laws change the lure of becoming an independent utility; though this is in-and-of-itself probably a fad should encourage system ownership.

Benefits of this trend: Solar (PV, CSP, CPV) is ideal for this potential trend as once installed it is low maintenance (though not zero maintenance), reliable and works well as part of a hybrid installation.  

Odds of this trend:  40% this potential trend will get a lot of press in 2014, but to become a true trend (something that brings with it relatively permanent change) more than announcements are needed.  Changes in the laws of some countries need to change and the initial gold rush atmosphere (which will bring with it saviors and shysters) must subside. The likely timeframe for development of this trend is five years, but ten years to mature. 

Potential Trend 2: Residential Lease Model:  Removes the onus of educating energy consumers about owning the means of production and encourages more rapid adoption of PV.

Why this may not become a trend:  Currently a US phenomenon, there is no standardization of lease vehicles, little understanding of solar among energy consumers, not everyone owns their own roof or if they do, own a roof that is young enough in its lifetime to support solar and once the math is done, a low interest loan and buying the system makes better economic sense. Other drawbacks include what happens should the lessee want the system removed, or, sell the house, or abandon the house.  Should there be expensive and well publicized roadblocks to system removal this potential trend would end.

Why this may become a trend:  Particularly in the US, independence (from practically any interference in anything) is a closely held value.  Many energy consumers would like to control energy costs but cannot afford to buy a PV system, plus, the lure of free solar (a promise in many ads for solar leases) is compelling to many.  The lease concept is familiar, even though many may find the details confusing.  Finally, the concept of owning the means of electricity production has proven stubbornly difficult to get across or to encourage excitement about – the solar lease hops over the need to educate and still may lead to more residential PV system ownership. 

Benefits of this trend: More solar is the obvious benefit of the solar lease. The assumption is that seeing more solar in neighborhoods will encourage people to explore owning or leasing a system.  There is also the potential of expanding this trend to apartment complexes, wherein (similar to the merchant system) the apartment house owner would sell electricity from the solar installation to apartment dwellers (a group is pursuing this model in France).  

Odds of this trend: 67% for better or worse and love it or hate it, the solar lease trend is likely real and will hopefully mature into a vehicle with costs (including escalation) that more closely resemble the true costs of owning a solar system.  Escalation charges based on assumed utility rate increases need to be rethought.  

Potential Trend 3: Community solar, solar gardens or Group Owned Solar:  Call it whatever you like, typically this model allows people to buy shares in solar installations that serve the community.  The installations can be ground or roof top, on or near community centers or schools and also on reclaimed land (among other areas). 

Why this may not become a trend:  The initial installation remains costly and community buy-in must be encouraged in order for this to make economic sense. That is, enough people need to buy shares and agree to whatever the terms are or the cost would likely appear prohibitive even though the benefits such as cleaner air and controlled costs in the long term are clear.   

Why this may become a trend:  The off-grid solar community has much to teach the grid connected solar community in terms of educating populations, gaining enthusiastic buy-in and finally deployment of a concept that is decades old.  In the developing world this concept is not a trend it is established.  Communities with group owned installations are enthusiastic about being a part of an energy generating asset, their participation in ameliorating climate change as well as the educational aspects. 

Benefits of this trend: Educating the community about solar technologies, climate change and energy independence is one of the most significant benefits of this trend.  Participation in in community solar projects and plans also encourages utilities (in the US there is slowly growing utility participation in this model) and energy consumers to work more closely together as well as share ideas and, well, energy.    

Odds of this trend: 63% this trend is building slowing in the US and the model can be co-opted by other countries and regions around the world.  Studying village grid (micro grid) models in the developing world would offer insight as to how community members learn to work together towards the success of these installations.

Potential Trend 4: Storage:  Storage technology is, on its own, not a trend (R&D is decades old), nor is it necessarily crucial to future grid connected solar deployment. Interest in storage technology for grid connected deployment is currently high, but interest alone does not a trend make. Storage is crucial for successful off grid solar deployment and is mature in this regard through the use of lead acid battery technology. 

Why this may not become a trend:  Storage is expensive and its value, essentially independence from the utility grid, has not been established. The true costs of storage are currently obscured, that is, current prices do not reflect costs.  Unfortunately, it may not be possible to increase the price that provides enough cushion in the margin for quality control, R&D and profit.  As with other technologies, unfortunately, many may enter with potentially viable technologies and many may fail because they could not price product appropriately.  Finally, disconnecting from the grid and becoming self-sufficient requires a willingness to conserve, which is rarely popular.

Why this may become a trend:  Utilities are showing concern about the growing size of residential and small to medium commercial installations that are sized to cover 100% of the energy needs of the building and its inhabitants.  This cuts into utility profits.  The only way for utilities to control this is to a) own more solar installations (the means of production) and sell the electricity from these utility owned assets b) develop utility solar lease models for their rate payers where the utility installs solar on the roof and charges the roof owner a set rate and finally c) charge a monthly fee for grid access as back up, among other reasons.

Benefits of this trend: Self consumption and the use of solar encourage a more pragmatic attitude towards energy also encouraging conservation. Storage could allow for true energy independence from escalating energy costs.

Odds of this trend: 31% Storage is still too expensive and a sudden miraculous technological breakthrough is unlikely.  Instead, options that do not reflect the true cost and thus teach nothing about the true value of the technology are currently being deployed.  This potential trend likely needs ten years and a lot of investment to begin approaching viability.  

Potential Trend 5: Solar Deployment in Latin America:  Solar technologies are not new to the countries in Latin America. Deployment of off-grid applications in the region is well established.  Tender bidding is the preferred vehicle for large commercial installations and there is potential among mining concerns for merchant system sales.  

Why this may not become a trend:  High import duties in many countries, unstable economies, significant reserves of oil, potential reserves of natural gas (fracking), unwelcoming topographies and low tenders are a few of the risks in the region that indicate the hoped for level of deployment may not come to pass.

Why this may become a trend:  The need for reliable energy generating options is strong among the countries in this region and though affordability is not strong, there are entities willing to invest in merchant installations (mining concerns) as well as almost monthly tenders for energy generation in the countries of Central America, South America and the Caribbean.  Deployment has begun on a fraction of the multi-gigawatts of potential. 

Benefits of this trend: As solar deployment increases and should it begin to tiptoe near the promised multi-gigawatt level, this region is likely to invest in domestic manufacturing, which hopefully would mean cell technology development as well as module assembly. Given the high cost of Greenfield manufacturing, module assembly appears more likely.  Nonetheless, the construction (demand) sector would provide necessary jobs and the supply (cell, thin film and module assemble) would provide necessary jobs. Deployment of reliable, clean solar energy technologies could be a stabilizing factor of future energy costs. 

Odds of this trend: 44% though deployment has begun and queues of solar projects in many countries are long, taxes are high and actual deployment is moving at a snail’s pace.  A regional economic shock could derail many projects.  Tenders are, in most cases, too low to support profitable installations.  The highest likelihood is that deployment will continue resulting in a percentage of the expected gigawatts but certainly above past levels of annual installations.