The UK has been one of the least attractive PV markets for thin-film solar panels. The market share of thin film in the UK solar industry barely nudges over 1% compared to a global figure that is an order of magnitude higher.
Between 2008 to 2010, thin film had a 5% market share in the UK. Between 2011-2012, it declined to 2%. And during 2013 so far, it is less than 1%. In fact, so far during 2013, every one-in-three modules supplied to the UK has been a Trina Solar c-Si module.
The only notable (in size) thin-film installation in the UK however is at Rhosygilwen in Pembrokeshire dating back to 2011, the modules for which were supplied by CIGS manufacturer MiaSolé (now, interestingly, part of Hanergy Solar’s new thin-film empire).
Currently, there are only two companies with global and bankable thin-film panels, classified by NPD Solarbuzz as tier 1 thin-film module suppliers. The dominant one, First Solar (with 55% of global thin-film production in 2012), has barely set foot in the UK and has no market share in what is now approaching a 3GW cumulative country market. The other – Solar Frontier – had a few commercial rooftop installs back in 2011 and 2012, but has subsequently (and understandably) retrenched to domestic Japanese PV market supply.
The UK hit the global stage in Q1 2013 and clocked up over 500MW of PV demand, not the 350MW figures being branded in the press that came from a news agency source a few months back. Q1 2013 demand in the UK was dominated by ground-mount, but this was 100% satisfied by c-Si panels with no thin-film panels in sight. The large commercial rooftop installs also used c-Si panels.
But with the UK not featuring on any First Solar roadmap and Solar Frontier being sold out and occupied with project activity on its home turf, it is maybe not surprising that thin film currently has so little market share in the ground-mount segment in the UK; Sunbelt climate comparisons aside.
What about the residential rooftop market in the UK, currently chugging along with a respectable run rate approaching 100 MW of quarterly demand? Is this really a great opportunity for thin-film suppliers? Well, even the most ardent a-Si (or tandem or triple) proponents have finally started to acknowledge that a panel with 9-11% efficiency on a residential rooftop is not going to displace even a moderate performing multi c-Si module. Furthermore, the nearest thin-film competitor in the trailing tier 2 hopefuls is a-Si based maker 3Sun, and developing business in the UK is not forming a key strategy of Enel’s solar business plans either.
Therefore, for residential, we come back to CdTe and CIGS. CdTe is out the equation, mainly because First Solar is not active in the UK (and residential rooftops are not their model anyway). Taking First Solar out the picture, CdTe has no strong driver in the PV industry today globally, far less the UK.
In a similar vein, if Solar Frontier is removed from the rooftop segment opportunity in the UK, then are there really any strong alternatives for CIGS panels into the UK? Whether Solibro is part of Q-Cells or part of Hanergy does not change the picture too much, as Solibro has not had a strong market share in the UK and is not being championed by any of the downstream channels that are controlling the bulk of the UK PV industry demand today.
But CIGS has another challenge in terms of cost. Compared to c-Si manufacturing and to First Solar’s disclosed cost structure, very little is known about the cost competitiveness of the other CIGS manufacturers. Part of this reason stems from lack of volume production scaling or being able to justify running fabs at high yield levels in the past. Most of the publicised costings for CIGS manufacturing have largely been academic, third-party estimates and not based on real life conditions.
But one key marker came in April 2013 when AVANCIS disclosed that current market prices for PV modules were 40% lower than AVANCIS production costs. Given that AVANCIS was arguably one of the most competent CIGS companies in that technology space, it begs the question of whether pure-play thin-film CIGS operations can be justified by any other CIGS producer today.
The caveat here though relates to the phrase “pure-play thin-film CIGS operations”, and in this respect Hanergy has the financial scope to change this proposition in a similar way to Solar Frontier’s (or Showa Shell’s) revised downstream business model. If Hanergy seeks to use its in-house technology buys as a funnel to serve its own projects business (in the UK or elsewhere), then the goalposts can – and will – be moved.
Therefore, while historical trends based on legacy channel supply in the UK may not provide a rosy picture for thin-film technologies, any model that sees considerable finance flow into downstream project development does open up new opportunities. Currently, the downstream channels and the upstream channels in the UK are comprised of different companies doing business with one another.
Therefore, the door is wide open to the likes of First Solar, SunPower or Hanergy to challenge this operating climate, and drive a sales pipeline for their respective in-house technologies of choice for ROC-incentivised, ground-mount or large commercial rooftop applications. And if the UK does settle down to become a 2GW annual PV demand territory over the next few years (dominated by ground-mount), it would be very surprising if new players and new business models were not seen to enter the UK PV supply/demand debate. And as such, matching the 10% global market share that thin film holds is not at all unrealistic.