Solar cell manufacturers are undertaking aggressive expansion plans at present in an attempt to meet ambitious 2011 shipment forecasts, according to Solarbuzz’s latest quarterly report. This ramping up of production has the potential to create US$15.2 billion in revenue for manufacturing firms – a year-on-year rise of 41%.
Contributing to this rise will be a 31% year-on-year increase in c-Si equipment spending and a massive 71% jump in thin-film demand. Underpinning this thin-film growth is a resurgence of investments in a-Si and CIGS technologies, which account for 78% of planned thin-film capacity expansions.
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Tier 1 production expansions remain dominated by aggressive schedules announced by publicly-listed Chinese c-Si producers, followed by cell producers in Taiwan and thin-film market leader First Solar. Among the companies issuing revised year-end nameplate capacities are JA Solar (3GW), Trina Solar (1.9GW), Neo Solar Power (1.8GW) and Jinko Solar (1.5GW).
“Fab investments during 2011 are providing opportunities for the PV equipment supply-chain, reflected in tool backlogs at the US$1 billion level reported during Q1 2011 by equipment leaders Applied Materials, Centrotherm, GT Solar and Meyer Burger,” said Solarbuzz’s senior analyst Finlay Colville. “While suppliers of choice to tier-1 manufacturers have been forced to increase monthly tool shipments, tier-2 c-Si and thin-film investments are offering significant revenue upside for emerging equipment suppliers.”
Despite this capacity expansion, market demand is projected to increase by just 12% this year, as the market reacts to feed-in tariff cuts in several major European nations. This imbalance will have a profound impact on the equipment supply-chain, starting with a reset of capacity growth plans during second half of 2011.
Q1 2011 saw solar equipment spending reach a new quarterly high of US$3.7 billion. Solarbuzz predict the current spending cycle is set peak in Q2, followed by a sharp decline from Q4 onwards, as the industry resets its expansion plans to meet the pending market downturn. For leading equipment suppliers aligned with tier-1 expansion phases, this will translate to an immediate decline in new order intake.
However, new opportunities will also emerge for equipment suppliers of next-generation fab tools, as high-efficiency roadmaps are reprioritized; Q-Cells recently announced plans to upgrade their 1.1GW capacity during the second half of the year with front- and rear-side enhancements, providing an early indicator of roadmap deliverables.
With the uncertainty surrounding demand in the next year or so, further expansion by thin-film entrants will depend upon the success of initial fabs ramped up in 2011 and 2012. However, a long queue of ambitious investors is likely keep this fragmented segment financed for some time.
