High upfront capital costs, a financial crisis that starved start-ups of capital injections, and plunging polysilicon prices were only some of the key challenges that Applied Materials ‘SunFab’ a-Si thin film customers faced in 2009. The strong emergence of First Solar with its alternative thin-film technology with much higher conversion efficiencies and lower manufacturing costs has put a squeeze on a-Si market penetration. Mike Splinter, Applied’s chairman, president, and CEO, finally acknowledges that many of its SunFab customers have found the current environment challenging. However, in its latest quarterly conference call, Splinter was adamant that the company had full belief in the technology and that the key market for its large substrate panels was only just starting, that of large-scale utility plants.
“The price declines in crystalline silicon modules have exerted margin pressure at some of our thin-film customers, in some cases lowering their demand and factory utilization to very low levels,” remarked Splinter in the conference call.
Splinter also noted in the call that it was remaining focused on supporting its SunFab customers to gain a competitive edge and meeting all of its guaranteed performance and operational commitments under the SunFab customer contracts.
“When you look at the temperature coefficient, when you look at the incident light, when you look at ambient particles in the air versus the efficiency of these panels, installation costs are huge advantages over other technologies,” noted Splinter. “The utility-scale solar has to develop, it’s still a very nascent market, it’s a very small percentage of the total.”
Putting a positive spin on recent customer developments, Splinter highlighted that it had signoff at two new lines during the quarter, bringing the total to nine. He also noted that two customers announced large development projects this year and that customers now have 30MW of modules installed in the field, providing field performance data to demonstrate the capabilities of the technology.
However, the competitive challenges for SunFab users remains. Recently, Phoenix Solar, one of the largest PV system integrators and a committed user of various thin-film technologies, established operations in Oman to handle projects in the Gulf States, which would be large-scale in nature. Phoenix Solar at the time confirmed to PV-Tech that the inherently hot climate conditions favoured thin-film technologies over conventional c-Si technology. However, the company would be supporting the use of CdTe modules in the region.
Applied Materials also reported that its EES division for the quarter reported had encountered a decrease in orders of 36%, primarily due to declines in thin-film solar business development.
Sales in this division are expected to decrease by more than 25% because of the near-term decline in thin-film solar sales, which c-Si sales growth would not be able to offset.