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Could U.S. Solar Demand
Bring PV Factories Back?

Researchers at the U.S. Department of Energy’s National Renewable Energy Lab (NREL) and the Massachusetts Institute of Technology (MIT) have collaborated on a study exploring the factors that drive regional solar photovoltaic module manufacturing. One key finding is as supply chains mature, the location of solar power demand becomes more important than regional factors such as labor costs and government industrial policy.

The study, published in the journal Energy and Environmental Science, assesses the drivers of regional trends in solar PV manufacturing. The study focuses primarily on those drivers as they relate to China and the U.S., but its authors say this is for the sake of simplicity rather than as a direct effort to bring PV manufacturing back to North America. However, the study does conclude that the potential for a U.S.-source PV revival is there because demand for solar power in the U.S. could attract and sustain it.

An interesting finding of the study is that the widely perceived advantage in labor costs in China is, in fact, negligible. Rather, Chinese market dominance is founded in economies of scale and a well-developed supply chain. The study reports that lower Chinese labor costs currently amount to a $0.07/W advantage over U.S. factories, but that advantage is negated by inflation and other indigenous factors.

Study co-author Ted James, an energy analyst at the NREL’s Strategic Energy Analysis Center, says shipping costs are becoming a factor in the global PV industry. “As manufacturing efficiencies increase and costs go down, shipping costs become more of a proportional factor,” he says.

For certain parts of the supply chain - namely, module assembly - shipping costs matter. As the industry approaches a $0.50/W module price, shipping costs - currently on the order of $0.03-0.05/W - stand out and stand to play a more important role in factory location decisions.

“The U.S. has world-class solar resources, is an attractive location for investments, has relatively low-cost and stable electricity supply, and a well-developed innovation infrastructure that PV manufacturers might use to their advantage for certain production activities,” says Alan Goodrich, lead author of the study and a senior analyst of solar manufacturing costs at the Strategic Energy Analysis Center. “In the future, as the crystalline silicon technology approaches the cost and performance targets that we lay out in our technical road maps, we believe that access to capital will be improved for manufacturers in all regions, and demand will rise significantly. These are conditions that will likely disrupt the current industry supply chain, mitigate the impact of government interventions on factory location decisions and create opportunities for firms to locate in regions that provide competitive advantages based on indigenous factors.” - Michael Puttré

 

U.S. Adds 976 MW
Of Solar PV In Q2’13

The U.S. added 976 MW of new solar photovoltaic capacity during the second quarter of 2013 (Q2’13), up 24% from 788 MW in Q1’13, according to the latest NPD Solarbuzz North America PV Markets Quarterly report.

During Q2’13, 72% of solar PV installations were ground-mounted, with the remaining 28% from residential and commercial rooftops, the report says. According to NPD Solarbuzz, utility-based PV projects accounted for 59% of quarterly demand, with the remaining 41% split between commercial and residential installations.

Strong demand continues to come from the ground-mount utility segment. Pacific Gas and Electric (PG&E) has recently completed several large-scale projects within California, including the California Valley Solar Ranch, phase three of Topaz Solar, phase two of Antelope Valley Solar Ranch and Gates Solar Farm. Other large ground-mount projects include the Arizona Public Service Agua Caliente plant and phase one of PG&E’s Copper Mountain Solar 2 in Arizona.

Quarterly solar PV demand in the U.S. is forecast to grow 14% to 1.04 GW in Q3’13. During the second half of the year, NPD Solarbuzz says Arizona and North Carolina together will add 400 MW, and an additional 500 MW will come from New Jersey, New Mexico, New York and Texas.

 

U.S. DOI Sets Public
Land For Renewables

As part of its “landscape-level approach” to clean energy development that addresses mitigation and conservation objectives, the U.S. Department of the Interior (DOI) has approved the establishment of the West Chocolate Mountains Renewable Energy Evaluation Area (REEA).

The public lands, located in California’s Imperial Valley, will be designated for the exploration and development of solar and geothermal energy. The Bureau of Land Management (BLM) estimates that the 64,058-acre area has the potential to develop over 3,330 MW of solar power and 150 MW of geothermal power.

The REEA creates a new Solar Energy Zone, which is part of the Obama administration’s efforts to facilitate solar energy development by identifying areas in six Western states with high solar potential, few resource conflicts and access to existing or planned transmission.

The Western Solar Plan, approved in October 2012, created 17 Solar Energy Zones with incentives for development within those zones and a process for considering additional zones. The DOI approved an 18th Solar Energy Zone in January, with the Arizona Restoration Design Energy Project. The West Chocolate Mountains REEA is the third Solar Energy Zone in California and brings the national total to 19.

 

Utilities Issue RFP For
SRECS And RECS In Ohio

FirstEnergy Corp. says it plans to issue a request for proposal (RFP) to purchase both in-state and all-state solar renewable energy credits (SRECs) and renewable energy credits (RECs) for its Ohio utilities - Ohio Edison, Cleveland Electric Illuminating and Toledo Edison. The energy company says the plan is intended to help meet this year’s renewable energy targets established under Ohio’s alternative energy law.

FirstEnergy says SRECs and RECs sought in this RFP must be produced by renewable generating facilities that are either certified by the Public Utilities Commission of Ohio (PUCO) or are in the process of being certified by the PUCO. The SRECs and RECs must come from the period between Jan. 1, 2011, and Dec. 31, 2013.

The following amounts and locations are being sought:

• 100 SRECs generated in Ohio;
• 6,500 SRECs generated in Ohio or states contiguous to Ohio;
• 120,000 RECs generated in Ohio and
• 145,000 RECs generated in Ohio or states contiguous to Ohio.

Navigant Consulting Inc. will administer the RFP as a competitive process. Based on the RFP results, the Ohio utilities will enter into agreements with winning suppliers to purchase the necessary quantities of SRECs and RECs.

 

Emerging Economies Boost
Solar Capital Spending

Global capital spending by producers of photovoltaic modules, cells, ingots, wafers and polysilicon is expected to rise by 30% in 2014 to reach $3 billion, says a new report by IHS. This will mark the first time that expenditures have increased since 2011, when they grew 8%.

IHS says the projected growth will bring to an end a two-year period when spending dropped significantly - by 72% in 2012 and by an anticipated 36% this year. During this period, PV industry capital spending will plunge by a total of $10.6 billion, the report says, falling to $2.3 billion in 2013, down from $12.9 billion in 2011.

Capital spending on manufacturing equipment and facilities used to produce PV raw materials or products has fallen in recent years because of massive overcapacity and oversupply, which have sent prices down throughout the supply chain. However, the IHS report says a sustained increase in capacity from emerging economies is set to spur the 2014 recovery.

Solar capital spending in emerging economies rose 23% this year, and IHS analysts expect it to keep rising in the low 40% range for every year through 2017. In contrast, following zero growth in 2013, the established markets are expected to shrink by 5-10% during every year through 2017.

The report says emerging markets account for 7.9 GW of the world’s total announced capacity for PV materials and products from ingots through modules, with the potential to climb to nearly 11 GW by 2017. Among all the emerging economies, the largest percentage increases in capacity are occurring in South America, Africa and the Middle East, IHS says.

 

Renewables To Pass
2 Terawatts By 2020

The installed capacity of renewable sources worldwide will reach an estimated 2,252.3 GW in 2020, finds a new report from Frost & Sullivan.

The report says the past decade has witnessed massive developments in terms of regulations and markets for renewable energy. While fewer than 50 countries worldwide had renewable support policies in place in the early part of the last decade, this number has now reached over 120. Investments in renewables have also risen dramatically over the past decade.

While the sector has escaped relatively unscathed from the vagaries of the global economic downturn, the report says the market is beginning to feel the pinch now as investments begin to decline significantly. Frost & Sullivan believes this is also a clear sign of the gradual shift in market power to emerging economies, where economic development and revised energy priorities will drive a more sustained increase in the adoption of wind, solar and biofuel generation technologies.

Urbanization, population growth and energy security concerns are other key drivers for the rise of renewable energy capacity in emerging regions such as Asia, Latin America, the Middle East and Africa. Further accelerating the uptake of new energy sources in developing countries is the need to diversify to reduce dependence on fossil fuels and the dramatic fall in the cost of renewable energy, the report says.

 

SEIA Cites Best Practices
In Solar Asset Valuation

The Solar Energy Industries Association (SEIA) and accounting firm CohnReznick LLP have released a white paper intended to highlight best practices and common pitfalls in valuing solar energy projects, including the tangible and intangible assets of a fully contracted system.

The report focuses on standard definitions used by regulators and parties involved in the valuation process. These standards include fair market value (FMV), market value, fair value, investment value, book value and value to the holder. According to the report, the most common valuations of solar assets will use the FMV standard, which is required for federal income tax purposes (e.g., investment tax credit and tax allocation of acquisition purchase price), as well as for Section 1603 grant purposes, and is frequently requested by investors.

The report groups accepted methods for valuing assets that do not have a readily available or quoted market price such as solar assets into three categories: asset/cost-based, income-based and market-based. SEIA advises that all three approaches should be used in solar asset valuation and that each provides relevant information to estimating FMV (i.e., the price that would be negotiated between a hypothetical buyer and hypothetical seller). The report breaks down the strengths and weaknesses and typical pitfalls associated with each approach.

 

Group Claims PV Makers
Hide Pollution Policies

The Silicon Valley Toxics Coalition (SVTC) has released the 2013 Solar Scorecard, according to which most of the solar sector’s environmental practices remain hidden from the public.

The SVTC Solar Scorecard ranks manufacturers of PV modules according to a range of environmental, sustainability and social justice factors.

In its fourth year of requesting environmental information from solar companies, SVTC says only 10 companies representing 34.6% of the PV module market share responded to the 2013 SVTC survey, and more than 25% of the top 40 solar companies fail to make almost any environmental information publicly available on their websites.

Key findings from SVTC’s research are as follows:

• Three of the top 40 PV manufacturers (REC, SolarWorld, Yingli) share with the public extensive chemical emissions disclosure and reporting.
• Twelve of the top 40 PV manufacturers post annual hazardous chemical reduction targets on their websites or in sustainability reports.
• The number of companies with fully funded extended producer responsibility (EPR) schemes in the PV industry dropped from one to zero. First Solar, the only major company with a fully funded EPR program for the last three years, has eliminated its EPR program in most of its U.S.-based sales.
• Trina Solar (77/100), Yingli (75/100) and SunPower (69/100) earned overall top scores for 2013. SolarWorld and REC earned the highest scores for sharing information about their emissions with the public.

 

Solar Storage Systems
To Hit $2.8B In 2018

Solar power systems integrated with energy storage will yield a $2.8 billion market over the next five years, according to a new report from Lux Research.

The report, titled “Batteries Included: Gauging Near-Term Prospect for Solar/Energy Storage Systems,” says grid-tied solar installations that feature an energy storage component (e.g., batteries) will total 675 MW in 2018. Off-grid applications, including telecom power, will total 36 MW.

According to Lux Research, while the off-grid market enjoys higher profit margins, the much larger addressable market for grid-tied battery-backup systems means they will dominate the integrated solar power/energy storage market.

Assessing the emerging market for solar power/energy storage systems, Lux Research analysts found that residential applications will dominate through 2018. As lithium-ion batteries and overall storage arrays fall in price, residential systems will gain the most, growing to 382 MW in 2018. Meanwhile, the light commercial segment will increase to 220 MW, while heavy commercial/industrial systems lag, growing only to 73.3 MW.

The research firm says that Japan will be the worldwide leader in this market. Hit by high electricity prices and seeking alternative energy after nuclear woes, Japan will install 381 MW of solar coupled with storage by 2018, leading all other markets by a wide margin. Germany will come in second at 94 MW, while the U.S. will be third at 75 MW.

Lux Research also says that newfound storage policies may dramatically increase the market. This year, Germany set aside $67 million to subsidize solar-tied energy storage, and the U.S. Senate introduced a program that could fund $7.5 billion worth of new storage projects, or about 7.5 GWh of capacity.

 

Banks Boost Clean
Energy Financing

Clean energy financing by the world’s development banks increased 19% in 2012 to reach $109 billion, according to new research from Bloomberg New Energy Finance (BNEF). The top three banks were Germany’s KfW, China Development Bank and the Brazilian Development Bank.

The 26 institutions covered by the analysis have financed a total of $425 billion in renewable energy, energy efficiency, and electrical transmission and distribution since 2007.

BNEF estimates that clean energy financing by development banks has grown at a compound rate of 25% per year over the last five years. This trend is expected to continue, especially as the larger development banks such as the European Investment Bank and World Bank are scaling down their investments in coal projects, which should leave more of their finite capital available for clean energy projects.

 

Investment Bank Targets
Central America

The European Investment Bank (EIB) has agreed to provide $230 million to support investment in hydropower, wind, geothermal and photovoltaic renewable energy projects across Central America.

The joint program with the Central American Bank for Economic Integration is expected to enable more than $500 million of investment in projects in six Central American countries: Honduras, Nicaragua, El Salvador, Guatemala, Costa Rica and Panama.

The EIB says the initiative will allow support for public- and private-sector investment in both renewable energy and energy efficiency projects. Eligible projects must comply with relevant environmental and social standards.

 

SunEdison To Spin Off
Semiconductor Business

SunEdison Inc. says its board of directors has unanimously approved an initial public offering of the company’s semiconductor business to create SunEdison Semiconductor Inc.

SunEdison plans to sell a minority ownership interest in the semiconductor business to the public. The company says it expects to use proceeds from the separation to fund initiatives related to the solar business, to repay existing indebtedness and for general corporate purposes.

The newly formed SunEdison Semiconductor will operate as an independent company with a new board of directors.

 

NRG Energy Acquires
N.Y. Energy Provider

NRG Energy Inc. has acquired Buffalo, N.Y.-based demand response provider Energy Curtailment Specialists (ECS). NRG Energy says ECS currently manages more than 2,000 MW of demand response across the country for over 5,000 customers.

ECS’ headquarters will remain in Buffalo.

 

Kawa Secures Investors
For Conergy Americas

Florida-based financial firm Kawa Capital Management Inc. has completed its acquisition of Conergy Americas, the North American subsidiaries of Conergy AG. This is the first step in a multiphase acquisition of Conergy sales units in the U.S., Canada, Singapore and Thailand.

Kawa stepped in to take over the brand and sales organization of foundering Conergy in July.

Kawa says the remaining global sales units of Conergy AG and their associated administrative, management and infrastructure functions will continue operating in their current structure and will be acquired in the second phase of the process, targeted for completion by this month, subject to final agreements.

 

Salt Lake City Launches
Solar Information Website

Salt Lake City and Utah Clean Energy, a nonprofit advocacy group, have launched an online solar information resource for residents, businesses, builders and local government officials. The site, SolarSimplified.org, includes information on incentives, zoning requirements, contractor selection tips, policies and permitting processes, along with tools such as cost calculators.

The new website includes a solar resource mapping tool for Salt Lake City and Salt Lake County. The website was created with contributions from Salt Lake County and the Utah Automated Geographic Reference Center and is supported by the U.S. Department of Energy SunShot Initiative’s Rooftop Solar Challenge and the Wasatch Solar Challenge.

 

Suntech Says Recovery
Process Making Progress

Suntech Power Holdings Co. Ltd. says it has reached an understanding with its creditor working group led by Clearwater Capital Partners and Spinnaker Capital Ltd. for restructuring the company. Suntech says it plans to exchange its outstanding debt into equity for its creditors and finalize a deal with a new “strategic investor” as a source of new funding.

In late August, Suntech restructured its board of directors, announcing several resignations and the election of a new chairman. On Sept. 13, David King stepped down as CEO of the company and was replaced by Zhou Weiping.

 

Silicor Gets Funding
For ‘Solar Silicon’

San Jose, Calif.-based Silicor Materials Inc. has received $6 million in new funding from existing investor Hudson Clean Energy Partners LLP to support the company’s development and manufacture of its Silicor solar-quality silicon. S