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After a brief hiatus from the blog, it’s time for the latest edition of Solar Short Takes. This time, the roundup and commentary focuses on what will be the largest solar PV power plant in the lower 48, Yingli Solar’s marketing coup and deft touch at the World Cup, words of analytical wisdom from Barclay Capital's Vish Shah, a few nuggets from PV-Tech’s exclusive video interview with Samsung’s solar energy boss, and TSMC’s entry into the thin-film arena via its investment in CIGS start-up Stion.
Million-module march. What will be the largest solar PV farm in the United States (at least temporarily) is coming along nicely. Sempra Generation said earlier this week that the first 8MW block of a planned 48MW system at the Cooper Mountain project in Boulder City, NV, has been completed and activated. Taking the company’s claims at face value that it will finish and plug in the remaining 40MW by year’s end, that plots out to an installation velocity of more than a megawatt per week by First Solar’s EPC team.
When the project is done, dusted, and delivering electricity to Pacific Gas & Electric, the four-dozen new megawatts will join the nearby 10MW at the El Dorado plant to add up to a record-setting 58MW. One cool factoid about the project is the number of modules—nearly a million CdTe thin-film black beauties.
Score one for Yingli. Solar power has netted a goal at the World Cup, at least on the branding front. If you’ve watched any of the games, you have no doubt seen the Yingli Solar advertisements pop up as part of the sponsors’ digital signage that provide the backdrop around the edges of the pitches of the football stadiums in South Africa. In a photo on the official FIFA site, the Chinese PV company's blue, white, and, orange design can be seen in the background as Landon Donovan clinically scores the U.S. team's first goal against Slovenia.
An advert position I’ve seen several times has found the Yingli graphics sandwiched between one of the most recognizable logos in the world—McDonald’s (although thinking of solar on the same level as a commodity like a Big Mac and fries may have unintended consequences).
The fundamental things apply. Vishal Shah of Barclays Capital Clean Technology continues to be one of the most consistently diligent market analysts covering the solar PV segment. His regular investment notes provide much more than basic “buy/hold/sell” info, delving into the details and fundamentals behind his models and forecasts. He often points out critical industry trends in his reports, such as the following nuggets from his June 16 note on JA Solar (JASO).
Shah says he remains skeptical over the cell market fundamentals for the second half of the year, noting that “historically, this segment of the value chain has seen bigger booms and bigger busts-- over 150 new cell lines are likely coming online in July/Aug. timeframe (emphasis added), and current spot demand environment may prove to be temporary.”
Although I’m not sure how much actual raw capacity those 150-plus lines will comprise (it’s at least a few gigawatts), the prospect of so much crystalline cell capacity being added in such a short period of time could end up flipping the cell pipeline into oversupply mode.
But not so fast.
Another area of concern is the production equipment supply chain, according to Shah. “JASO is among the few cell suppliers that have received equipment on-schedule--consequently, it is able to meet strong Q3 demand better than peers. Most other cell suppliers are experiencing two-month equipment delays. Baccini (cell-printing equipment supplier [a unit of Applied Materials]) has over 200 lines coming online this year (~5GW nameplate capacity assuming 25MW per line). JASO is likely getting Baccini equipment earlier than other competitors and as such could likely benefit from the current strong demand environment.”
The pushed-out lead times and bottlenecks in the PV production tool sector will certainly slow the ramp rates of all those new cell lines, but the (in)ability of the equipment companies to meet the sometimes-unpredictable (and unreasonable) demand cycles of their customers is yet another sign of the solar manufacturing industry’s continuing process of maturation.
And then there’s the issue that haunted the industry for years—tight wafer supply. As Shah notes, “cell suppliers are raising 2H10 production forecasts without additional wafer capacity. We expect this trend to further intensify wafer market tightness. Roughly 6GW of incremental cell capacity would become available in 2H10, and only 3-4GW of wafer capacity is estimated to become available during the corresponding period.”
Just seeing the words “tight wafer supply” makes me wince and say “oh no, not again,” but the crunch this time seems to be temporary, with several more gigawatts of polysilicon and wafering capacity coming online in the next year or two.
Sing a song of Samsung. Kudos to my colleague Mark Osborne, whose exclusive video interview with the head of Samsung’s solar energy division at the recent Intersolar Europe show can be seen elsewhere on PV-Tech. What’s clear from their conversation is that the Korean megacorporation has every intention of being a serious player in the PV space.
Executive VP Changsik Choi told Mark that the Korean electronics giant believes it can readily use its expertise in semiconductor and LCD process technologies in its ongoing crystalline-silicon and thin-film PV development activities. He said that Samsung plans to spend $6 billion in capex for solar by 2020 and that the chaebol is focusing on monocrystalline cells (“low cost, high efficiency”) and exploring thin film PV “business opportunities” for the near future. Choi also noted that Samsung’s PV production capacity will expand to “several megawatts followed by several gigawatts” in the near future.
The “S” in TSMC also stands for solar. Another Brobdignagian semiconductor company getting into solar in a big way is Taiwan Semiconductor Manufacturing Corp. or TSMC. After taking a 20% stake in Taiwanese c-Si cellmaker Motech last year, the leading chip foundry just announced that it’s entering the thin-film PV arena. The company’s ventures unit has ponyed up $50 million for a 21% share of Stion, an emerging-from-stealth CIGS company based in San Jose. Stion also said it has raised another $70 million in Series D funds of its own (or at least its investors) and plans to build a 100MW production plant at its current facility.
A key part of the deal involves technology licensing, which will facilitate the fabrication of the Lilliputian solar start-up’s monolithic modules somewhere inside TSMC’s massive complex of manufacturing facilities. It will also bring the chipmaker’s prodigious process knowledge to bear on future generations of the Stion technology (which includes a tandem-junction design). Although more details about Stion’s inner workings and gameplan will need to come out before making a proper evaluation of its prospects, the presence of TSMC bodes well for its emergence from the thin-film PV pack.
How much the likes of Samsung and TSMC will rearrange the deck chairs on the PV cruise ship will be fascinating to observe, umbrella drink in hand, over the next few years. But as anyone familiar with the companies’ track records in chipmaking can tell you, never underestimate their ability to kick ass (including the derrieres of their equipment and material suppliers), take names, and dominate their chosen market sectors.
