A new analysis confirms that the booming thin film solar segment is going to boom even more in 2009 – thanks to low-cost industry leader First Solar.
The growth should quell speculation that the drastic drop in polysilicon prices is giving makers of silicon modules – especially those out of China – a clear competitive edge over thin film. Some analysts have gone so far as to foretell the erosion of First Solar's dominance, due to the price plummet.
But thin-film, made with little or no polysilicon, is the most rapidly growing portion of the PV landscape, courtesy of its still cheaper technology. It comprised 23 percent of the overall photovoltaics (PV) market share in 2008.
Arizona-based First Solar is its undisputed leader. As the global economy tanked, its sales continued to rocket up on the back of its "cheap-as-coal" cadmium telluride panels – so much so that the company is set to leapfrog silicon competitors to become the world's top panel producer in 2009, according to a new report from the iSuppli research firm.
Specifically, iSuppli says First Solar will produce 1,100 MW worth of solar cells this year. That's double the 503 MW it made in 2008, and almost twice as much panel production as its nearest competitor, China-based Suntech Power.
It will be the only company among the top four solar panel suppliers able to gain market share in 2009, iSuppli predicts. Number 2 SunTech, number 3 Sharp and number 4 Q-Cells are all expected to shrivel in terms of their total solar market share.
In contrast, First Solar's portion of global panel production will shoot to 12.8 percent in 2009, up from 7.5 percent in 2008. The company will be responsible for nearly a third of all PV installations this year.
The full figures, via iSuppli:
Cheap is key for industry domination.
"First Solar sells its products at very competitive prices, always undercutting crystalline cells," said Dr. Henning Wicht, senior director and principal analyst for iSuppli.
"With its capability to produce cells at a cost of 89 cents per watt in the second quarter, First Solar is generating stable operating margins, while its competitors are struggling to stay profitable. Despite global oversupply of PV modules, First Solar is continuing to expand and is able to sell nearly all of its finished goods."
The "significant cost advantage" has given First Solar a leg up in snatching vital utility-scale contracts in Europe and the United States. Recently, the company announced agreements to build two gigantic projects in Southern California. The installations, expected to be among the largest of their kind, will have a generation capacity of 550 MW, enough to provide power to some 170,000 homes.
Next up? China. The iSuppli prediction comes on the news that First Solar has signed a "memorandum of understanding" with the Chinese government to build a mega 2,000-MW solar power plant in Ordos City in Inner Mongolia.
The Manhattan-sized, 25-square-mile facility is expected to be the biggest solar installation in the world when it's completed in 2019.
More such announcements are widely expected.
"Discussions with First Solar about building a factory in China demonstrate to investors in China that they can confidently invest in the most advanced technologies available," said Cao Zhichen, vice mayor of Ordos Municipal Government.
In another promising sign, a delegation of senior Chinese government leaders visited First Solar's headquarters in Tempe this week, in what the company called "an exceptional meeting." The goal was
"to learn first-hand how the company's low-cost solar technology can help contribute to China's goal of achieving a low-carbon economic future as well as meeting China's increasing demand for sustainable renewable energy."
You can bet that if First Solar can help crack open the promising Chinese solar market, spurred along by a new government subsidy and feed-in tariff, it will become even more of a player in solving the global energy challenge.