Solar crisis set to hit in 2010, 50% of solar manufacturers may not survive | Hacker News Reader

Solar crisis set to hit in 2010, 50% of solar manufacturers may not survive

digitimes.com

28 pointscwan18 comments

I think it buries the lede. They point out that the solar manufacturers who don't survive are the ones who sell at >$2 a watt (ie more or less obsolete as far as tech goes) but then there's this:

"Average selling prices could drop below US$1 per watt in 2010 and US$0.50 in 2011. As many as 50% of the more than 200 solar manufacturers, mired in red ink with current selling prices above US$2.00 per watt, may not survive, The Information Network stated."

That's pretty exciting. $1 is supposed to be the magic number when it becomes more cost effective to build solar than coal at an installation level and there's no cost for the "fuel".

I came here to post this. The solar "gold rush" of 2006-08 was precipitated by companies like HelioVolt claiming they could achieve panel production for under $1/watt.

Cheaper solar panels won't kill the industry, it will make it economically viable on the large scale. If this article's predictions are correct, it's probably time to invest--if you know the right company, that is.

Very happy to hear this, as we have a solar startup building a massive production facility in Atlanta - http://suniva.com/

Could you comment on your cost per watt expectations please?

Well, considering that their units are supposed to be something like 20%+ efficient... I think it should be pretty good?

The energy conversion efficiency is independent of the cost per watt. 20% is a pretty good figure but not at a cost of $3 per watt for example.

Yeah, I don't know what their cost per watt is. Here's to hoping its good.

Cheaper solar panels could create large amounts of value for the industry's customers, but if sellers have no pricing power they will only capture a small fraction of that value, possibly negative if sellers end up preferring a small loss on the sale to no sale at all.

As Warren Buffett observes, the problem with technological improvements from an investor's perspective is that they usually happen in industries with no pricing power and the customer ends up reaping the cost savings. Great if you're a customer, of course. In the long run this can theoretically reduce investment in an industry. In practice, though, it looks like at least some investors are sufficiently optimistic that they'll throw capital at the industry anyway. That's how the optical fiber of the Internet backbone got paid for.

Only fools try to capture all the value they create (then the other person has no motive to engage in the transaction), but it really isn't enough to create value, you've got to be able to capture at least some of it, or there's no feedback loop of reinvestment.

Yeah, this reads like it was written by someone in the industry who's company is suffering from the inability to compete. The fact that solar power may finally become truly market-viable (as opposed to only supportable through massive subsidies) is very exciting.

How anticlimactic. Based on the title I thought the sun was due to slam into the earth next year.

Well, there is a pretty deep solar minimum in progress, if I remember correctly. Least sunspots in a century.

And I was wondering how the other 50% will manage to survive.

They'll be protected by solar panels. Duh, what did you think "solar panels" did?

Its interesting to see consumption so low. Its my understanding there is a "last mile" problem with providing solar to homes and small business. There are not enough companies making it easy for the small adopter. Its certainly not at the home depot DIY level yet. Maybe panel costs is still a factor. I know of a company going after this space in EU and U.S. I'm sure they're happy to see price competition on the supply side.

disclaimer: I've built a solar & wind powered home.

The 'last mile' is literally the problem if you want to stay grid connected and have solar on the side you have to jump through all kinds of regulatory hoops depending on your local situation.

The biggest critical component of a solar installation that is grid connected is the inverter and the disconnect setup, you will be spending a good bit of money on that.

A typical inverter will set you back about $1/W.

So you have to calculate that in as well, solar panels alone do not make it work, there is a large amount of money in mounting, inverters, cabling and installation involved.

This is one of the factors that slow down adoption.

Here's some more colour on this from a US (investor) perspective:

http://www.distressed-debt-investing.com/2009/09/possible-eq...

I don't see what's so surprising about this.

"Clean Tech" is one giant taxpayer-funded ponzi scheme.

Madoff would be proud.

From your profile: "Twitter account: @oil_and_gas"

Biased much?

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