Intersolar Munich - Key Takeaways
Pallavi MadakasiraWednesday, June 23rd, 2010
Top 6 Takeaways from Intersolar Conference, Munich:
1. Global Demand: We believe that the global demand for 2H 2010 based on responses from our experts could be anywhere between 5-6GW. Overall for FY 2010 it is clear that the year end rush in markets like Germany and Italy could swing the numbers between ~10GW on the low end up to 13GW. For 2011, our experts believe that it could be similar to 2010 or slightly slower. But if the global growth trends continue, 2011 could well be ~10-20% higher than 2010 global demand.
2. Demand From The Czech Republic, Benelux And The US: With great focus on countries like the Czech Republic, US and the Benelux nations in terms of global demand, we asked our experts about their expectation for these markets. Our experts seem to anticipate that the Czech Republic could be anywhere between ~700-800MW in 2010; Benelux nations to account for ~300-400MW and the US to account for as much as 400MW at the very least and up to ~900MW on the high end for 2010. As for the US market that is anticipated to be a growth market for PV in 2011 given the impending cuts in FiTs in other geographies, our experts believe that it could be ~1GW or higher in 2011.
3. New Application Status In Countries Like The Czech Republic And Italy: It appears that the Czech Republic is facing problems with regard to solar projects getting connected to the grid. But in Italy, new applications still seem to be accepted for solar project installations.
4. Pricing For Q3 and Q4 2010 For Wafers, Cells and Modules: As it regards pricing, it appears that prices for wafers, cells and modules are currently up. In Q3, cells and module prices are largely expected to be flat to slightly increase and in Q4, the expectation is that cells and module prices will be flat to slightly down.
5.Cell And Panel Cost Reduction: With regard to cell and panel cost reduction in Q3 and Q4 it appears that no significant cost reduction can be expected in Q3 or Q4 of this year.
6.Clarity Regarding A Possible National FiT In China: While it appears that our experts are anticipating a National FiT at some point in China to be announced, the time line for such an announcement seems unclear at this time. That said, it is evident that the domestic Chinese players stand to benefit the most if and when such an announcement is made.
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Tags: intersolar 2010, munich intersolar
Posted in Energy, Pallavi Madakasira, Solar | No Comments »
Clouds Forecast for German Solar Industry
Ishita ManjrekarThursday, March 18th, 2010
Dark clouds ahead for the German solar industry as the government’s July 1 cuts in the solar feed-in tariff (FiT) are expected to touch off a decline in pricing and internal rate of return (IRR). However, “gray skies are gonna clear up” four-to-six weeks after that, say PGR Experts, with prices readjusting and the solar industry back to business as usual.
Between 70-80% of Germany’s photovoltaic (PV) market is represented by small and medium sub-1 mW solar PV systems. Post cuts, we expect prices of components to fall by another 10-15%. This would cut current IRR of these systems from 10-12% down to 6-9%, which is still quite attractive for the rooftop market. Price cuts by wafer and polysilicon vendors also factor into pricing readjustments. Good quality, vertically integrated Chinese module brands should easily adjust to these changes.
PGR’s network expects demand will peak in Germany in Q4 of this year.
Tags: feed-in-tariff, FiT, Gernan Solar Industry
Posted in Energy, Ishita Manjrekar, Solar | No Comments »
Polysilicon pricing: soft and softer
Ishita ManjrekarWednesday, December 9th, 2009
Silicon prices from major producers have declined almost 20 percent over the past few months and, while a couple of producers maintain they are holding fast, the fact that most have reduced prices will be pressure enough to create equilibrium on the low end. As to pricing trends in 2010, our network thinks silicon prices will hold steady into Q1-10 as wafer/cell/module vendors buy raw material in preparation for Q2-10 demand from Germany (especially if they expect a FiT reduction on July 1). Past that, however, raw material purchases are expected to slow by May 2010, at which point prices will soften again as it takes about 2 months for polysilicon to be converted to modules.
Tags: PGR, photovoltaic, polysilicon, solar energy
Posted in Energy, Ishita Manjrekar, Solar, Uncategorized | 2 Comments »
Solar in Europe in 2010
Ishita ManjrekarTuesday, November 3rd, 2009
Germany in 2010: Consensus seems to be that there will be FiT cuts in Germany that are greater than what is stipulated in the current EEG, but the magnitude will be such that it will not kill the German manufacturing industry. There will be some price re-adjustment but demand will remain strong as long as there is no cap. The German residential/small commercial market (80% of total market) is relatively IRR insensitive and will continue to go solar so long as it a net positive transaction for the project owner.
Italy in 2010: There has been a lot of debate on what the Italian market size will be in 2010. I spoke with a bunch Italian project integrators and asked them to outline the exact procedure to construct both large and medium sized plants in Italy. Conclusion: the entire process and hence the market is utterly complex and uncertain. While the Italian market will be big in 2010 due to pressure from an impending FiT hange in 2011, 1 GW might be a bit too ambitious because of the procedural hassles. But based on the strength of the residential market and the few large projects that will get constructed the market can expect to be about 800 MW in 2010.
Tags: feed-in-tariff, Germany, Italy, Solar, solar markets
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Why aren’t we talking about Italy?
Ishita ManjrekarFriday, August 28th, 2009
With all the excitement surrounding the end of the year installation rush in Germany, I fear we are forgetting to look at other important solar markets and the policy changes that are looming ahead. For example in 2010 the situation is quite tricky in Italy. It’s also tricky to explain but I’m going to take a shot. The cap for the solar subsidies in Italy is 3 GW or 2016 whichever is sooner. In 2010 the FIT will be 2% less than the 2009 FIT. 2011 onwards we have no idea what the FIT will be. Also once a cumulative installed PV capacity reaches 1.2 GW, the FIT that exists at that point in time will be maintained for the next 14 months. Now it looks like Italy will hit that 1.2 GW mark by 1H10. But when that happens the tariff will not be constant for 14 months but will most likely be reviewed and readjusted to 20-30% lower than the current tariffs in 2011. So as a project developer, in order to ensure that you can avail the 2010 FIT you have to make sure your project is connected to the grid by Dec 2010. Now in Italy it takes about 3-6 months to connect to the grid. So projects will have to be completed by August 2010 to ensure grid connection by year end, which in turn means the last round of modules will be ordered in June of 2010 before. This is a very important risk associated with the Italian solar market that very few people are thinking about, in my humble opinion.
Tags: international investments, solar markets
Posted in Author, Energy, Ishita Manjrekar, Solar | No Comments »
First Solar’s Rebate Program
Ishita ManjrekarMonday, August 3rd, 2009
Questions I’m thinking about as I do more work on First Solar’s rebate program:
1.) How much does the rebate need to be to make FSLR competitive with c- Si?
2.) What does it mean for working capital and cash flow if customers have to wait until the modules are installed to get rebates?
3.) What will the procedure be to apply for the rebates?
4.) Is it worth going through all of this from their customers point of view? Or does it make sense to use c-Si where it’s basically one step?
5.) Why is there no love for their non-Deutsche customers?
Tags: crystalline silicon, First Solar, rebate
Posted in Energy, Ishita Manjrekar, Solar | No Comments »
Intersolar, San Francisco
Ishita ManjrekarTuesday, July 21st, 2009
I spent most of last week at the Intersolar in San Francisco. It was much better attended than last year, which is surprising in light of the oversupply and shortage of project finance issues that plague the solar industry. Most developers I spoke with mentioned that they had been pleasantly surprised by the turn out. In fact, some even ran out of business cards. The other thing that caught my eye was the large number of Spanish project integrators that were at the show exploring the American market. I suppose that makes sense, given how the collapse of the Spanish solar market in September of last year almost single handedly (with a little help from unwilling lenders) caused the module oversupply that the industry has been steeped in for over three quarters now. It seems to me that a lot of hope is being pinned on the US market. The grant-in-lieu and the loan guarantee programs seem to have infused the industry with a rush of optimism. PGR experts are cautious, though. There are still a lot of issues, risks and procedures that need to be worked out by the DOE, the utilities and the financial institutions that choose to get involved with the process.
I think it’s going to be an interesting 2010.
Tags: Intersolar, Semicon West
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Cisco’s Blade Server Strategy
Rajan VaradarajanWednesday, July 1st, 2009
Cisco already has had dominant market share in its core businesses. In looking for new sources of revenue and continued growth, the company saw the datacenter virtualization trend as a great opportunity. Perhaps it was a challenge as well, to enter a server market dominated by its traditional partners such as HP, Dell and IBM and, hence, antagonize them. This is inevitable, because wherever Cisco goes for growth, it is going to step on somebody’s toes.
Datacenter design is changing rapidly to meet the demands of massive amounts of data being driven largely by video applications. With the benefits of virtualization at hand, designers are beginning to take a top-down view of the datacenter. Cisco has teamed up with the leader in the space, VMWare, and storage behemoth EMC to just do that. In addition, Cisco also has partnered with NetApp in its grand vision of the USC- Unified Computing System.
The basic question may be, why does Cisco really care about server virtualization?
One possible answer: In a datacenter, each virtual machine mimics a physical server. Obviously, Cisco cares about any technology that increases bandwidth usage and thereby helps sell its mainstay routers and switches. Some examples are video like TelePresence, WebEx, and now Flip Video. Cisco wants to accelerate the adoption of 10Gb/s port usage so it can start building the 40Gb/s and 100Gb/s gears of the future. Datacenters are the first places that can happen. However HP, DELL and IBM are neither in a hurry nor motivated to provide their server blades with 10Gb/s ports yet. They appear to be content with the existing 1Gb/s ports. So, Cisco saw an opportunity to push its 10Gb/s adoption in server virtualization. Instead of waiting for other companies, Cisco is now building blade servers for the datacenter that are customized for server virtualization. These blades provide up to 1Gb/s pipe to each virtual machine, which would mean more 10Gb/s ports at the backend of the datacenter, helping in Cisco’s 10Gb/s push.
An alternate possible answer as to why Cisco cares about server virtualization: HP has recently stepped up its efforts in building networking gear, stepping on Cisco’s toes. HP’s Procurve product line seems to be gaining traction among its enterprise customers. In addition, with the acquisition of one of Cisco’s largest customers, EDS, HP is beginning to challenge Cisco’s dominance in the market. By some accounts, HP is the second-largest networking gear vendor.
Perhaps the reason is a combination of both the answers or there may be a third one. However, Cisco definitely has the wherewithal - money, technical prowess, innovative spirit, and great leadership in John Chambers - to deliver on the promise of its vision - UCS.
Conclusion: Admittedly, this is a very big vision. In hard times, Cisco re-invents itself as it has done many times in the past. I believe it has the fundamentals, savvy management and competitive spirit to pull off this one as well.
Tags: data center virtualization
Posted in Data Center, Networking, Rajan Varadarajan, Semiconductor, Software, Solar, Technology | No Comments »
Thoughts on FSLR Analyst Day
Ishita ManjrekarFriday, June 26th, 2009
We were at the FSLR analyst day on Wednesday. I have to say I was surprised at how easily everyone let management off. I would have expected to hear more pressing questions on:
* Current market conditions in Europe
* How is FSLR combating the financing bottleneck?
* How exactly does the company expect its business model to evolve?
* What needs to happen to hit the 12.5% efficiency target by 2012?
* What parts of the manufacturing process offer potential in terms of hitting these targets?
* Clarity on Phoenix’s recent comments on the solar market
Tags: FSLR Analyst Day
Posted in Author, Energy, Ishita Manjrekar, Solar | No Comments »