China’s National Energy Administration (NEA), has set a new PV target for 2015, which amounts to a whopping 27% more than the 2014 target of 14GW. Also last month, it was announced that the last of Beijing’s four major coal-fired power plants will completely shut down. China Huaneng Group Corporation’s 845-megawatt power plant will close in 2016. Worldwide and domestic outrage over air-quality account for one reason for the new and ambitious moves to expand renewable energy development, but major economic factors are at play as well.

Last year, President Obama and Chinese President Xi Jinping, announced “Historic” CO2 reduction plans that would see the Chinese carbon emissions peak “around 2030” and then level out or begin to decline. President Xi also promised that by then, 20 percent of China’s energy will be renewable. Many question how effective this policy will be, as China’s emissions continue to skyrocket. Also, with the Chinese governments dictatorial authority over energy policy, why will it take so long?

For better or worse, Chinese energy policy has generally been coherent, well organized and nimbly executed. When the nation required more energy to power it’s meteoric rise as the world’s industrial powerhouse, it needed only to proclaim that new coal-fired power plants be built, unhindered by any of the types of environmental debates held in democratic governments. By the same token, those plants can be shut down and replaced by cleaner gas-fired plants and new solar generation just as quickly, without any pushback from advocates of the “free market.”

Melanie Hart, a Policy Analyst on China Energy and Climate Policy at the Center for American Progress wrote in 2012: “Those policies are often difficult to parse because China’s economic system is not like that of the United States. It is a non-market economy with a top-down, command-and-control energy planning process that is often nontransparent with even more opaque interactions between the central government in Beijing and the provincial and local governments when these policies are implemented.” Hart was writing at that time about the trade dispute over China dumping low-cost solar panels in the U.S. market and the effect it was having on fledgeling American manufacturers.

Not only has China gained global dominance in Solar manufacturing, but it used its massive, unregulated coal plants to achieve that dominance. Hart pointed out three years ago that: The problem is China is particularly good at making things cheaply. At the lower end of the value chain, that is primarily due to the country’s low labor costs and massive supply chains. Also advantageous are China’s lax labor, safety, health, and environmental standards. At the higher end, that is often because the Chinese government provides generous subsidies and other forms of support for high-technology research, development, and commercialization. Low-cost Chinese manufacturing plays a large role in driving prices down for a wide range of products, including renewable energy technologies. Chinese manufacturing also plays a large role in pricing some U.S. manufacturers out of business, with many of those manufacturers claiming that the “China price” is driven by Chinese government intervention rather than natural market forces. If the Chinese government is intervening in a way that breaks trade rules then that type of rule breaking should be remedied in some way.”

The LED screen shows the rising sun in Tiananmen Square which is shrouded with heavy smog.

Regardless of the motivations behind the rapid movement toward a solar economy, the new solar push is a win/win situation all around. If the U.S. tariff does have an impact on the Chinese solar industry, the increased domestic demand will take up the excess supply, and hopefully, the Chinese people will begin to see a bright sunrise in clearer, less smoggy skies.

The post Chinese Solar: The Sleeping Giant Is Waking To A New, Smoggy Sunrise appeared first on Solar Tribune.

image: the diysolar.com

However, the ITC is set to expire in 2016, and the fate of the tax credit is of serious concern to nearly everyone in the solar industry. If congress fails to renew the ITC, it could have a chilling effect both on individuals who want to install residential solar systems, as well as the large companies who are installing the larger, utility scale solar projects.

One example of how the discontinuation of tax credits can chill fledgeling renewable energy industries is the 2012 sunsetting of the Wind Production Tax Credits. Since then, congress has battled over short-term extensions to the PTC, which has left wind project developers unable to plan for development beyond the current year.

“Wind has more than tripled since 2008, it can double from where it is today to 10 percent by 2020, then double again to 20 percent by 2030, and become the leading source of electricity in the U.S. by 2050,” said The American Wind Energy Association‘s Tom Kiernan. “However, to get there Congress must provide wind with the same policy certainty it provides to other energy sources by rapidly extending the Production Tax Credit for as long as possible.”

Could the U.S. solar market be looking at the same uncertainty as wind? According to Tony Clifford, CEO of Standard Solar, “If an extension happens it will be in late-2016, early-2017, but it won’t happen any sooner than that. This will still throw brakes on the industry for about six to nine months, which means layoffs will begin mid-2016. We have to start working the halls of congress now. Companies should join SEIA’s ITC coalition — get involved and start contacting your local political leaders. Show them the importance of solar.”

“Since 2006, 150,000 jobs have been created, 19.5 GW have been installed, and yearly installations have increased by a factor of 60,” said Rhone Resch, the Solar Energy Industries Association (SEIA) Executive Director. “Most of us in this room have jobs because of the solar ITC.” Resch laid out a frightening scenario at the recent keynote session at PV America 2015 in Boston, Massachusetts. “The reality is that we will lose 100,000 jobs if we lose the ITC — and these are conservative numbers. Ninety percent of solar companies will go out of business.”

Not everyone in the solar industry agrees with Resch. Jigar Shah, the founder of the nation’s largest solar services provider, SunEdison, has often expressed his opinion that subsidies are actually holding the solar industry back. In an editorial for Cleantechnica, Shah writes: The reasoning behind my strong stance is that, based on the cost of solar that I am personally investing in, solar is now cost-effective without subsidies for ideal customers in 300 utilities in 30 US states. Those 300 utilities account for about 20% of all of the electricity sold in the United States (using Energy Information Administration Form 861 data). Based on my experience, my thesis is that phasing out these subsidies will lead to 1) greater system cost reductions, 2) lower cost of money, and 3) greater standardization in the industry – all leading to a greater acceleration of solar PV deployment in the United States.”

Shah is not the only person in the industry who believes that the expiration of the Investment Tax Credit will lead to more solar installations. In this 30-minute audio interview at Renewable Energy World, Chris Lord, who has extensive experience financing solar projects with CapIron Inc, explains that the impact of the possible ITC expiration will depend on the local market. In markets that have flexible programs, namely Solar Renewable Energy Certificates (SREC) markets, it could actually increase the adoption of solar PV by increasing the value of SRECs and opening up an entire markets for both properties and investors that could not use the ITC before. However, only six states, Delaware, Maryland, Massachusetts, New Jersey, Ohio, Pennsylvania and Washington, D.C. have SREC markets. Lord admits that in markets with more rigid structures, like feed-in-tariffs, cash rebates, or tax credits, it might have a more long term negative impact. 

With installed costs plummeting recently at 13% annually, solar may survive the phasing out of the ITC. However, with utility lobbyists across the country looking for ways to discourage residential solar installations, it may once again be “the little guy” that suffers, while larger and larger, centralized, corporate owned solar generation facilities become more and more the model for solar development.

The post What Happens if the Federal Solar Tax Credit Expires? appeared first on Solar Tribune.

Orange County Register, about 50 full-time employees work at the office. Ethan Miller, Sunrun’s senior vice president of operations says that this year, Sunrun plans to hire an additional 50 workers. “We’re interested in expansion and Irvine has a great access to talent,” he said. “We’re doing design and very technical work, and we felt there’s great synergy with other companies and skills sets in the area.”

Sunrun currently serves customers in 11 states– Arizona, Connecticut, Massachusetts, New Jersey, California, Hawaii, Nevada, Oregon, Colorado, Maryland, New York and Pennsylvania. The design team in the Irvine office will serve customers in all of Sunrun’s service area, not just California.

“All that design work is coming through this hub and being pushed back out,” Miller said. “Every system is a custom design for that house,” which takes into account the home’s orientation and other factors.

The Wall Street Journal recently included SunRun in its list ODF “Ten Billion Dollar Ideas You’ve Never Heard Of.” The Journal Reports: “In 2006, the year before Sunrun Inc.’s founders launched their business, solar energy powered just 30,000 American homes, according to the Union of Concerned Scientists. By the end of 2013, there were about 400,000 homes in the country powered by solar, and Sunrun —and its business model— are a big reason why.

In the past, few homeowners were willing to pay tens of thousands of dollars for a rooftop solar installation that would pay off in smaller utility bills at some distant date in the future. Sunrun was the first company to cover the cost of the solar system installed on a residential roof, own the system, and handle maintenance. Homeowners pay the company monthly for the electricity the system produces, leading to lower utility bills.

Soon after Sunrun began financing panels, arch-rival SolarCity Corp. came out with a similar offering and then, in 2012, went public. The two companies, along with competitors such as Vivint Solar Inc. and SunPower Corp. , are trying to capture a market that appears to have room to grow–less than 1% of American homes have solar.”

There is no doubt that the solar industry has had amazing growth in the last few years, and the expansion of Sunrun is just one indication that even recent entries into the solar marketplace are feeling confident about strong future growth.

The post SunRun opens New Design Center in Irvine appeared first on Solar Tribune.

California, Texas and Florida have a lot in common. They are the nations three most populated states. All three enjoy warm, sunny climates. All three have perfect conditions for producing massive amounts of solar power. However, Florida lags far behind the other two mega-states in solar electricity production. Why?

“Florida is the best solar market in the eastern United States, and it’s clearly underperforming,” said Stephen Smith, executive director of the Southern Alliance for Clean Energy, which is part of a coalition of groups called Floridians for Solar Choice.

Florida is one of only five states in the United States that by law expressly denies citizens and businesses the freedom to buy solar power electricity directly from someone other than a monopoly electric utility. Now, Floridians for Solar Choice is working to place a question on the 2016 general election ballot asking voters to decide on expanding solar choice to Florida’s families and businesses. The ballot initiative would remove a barrier that currently blocks clean, renewable solar power.

One of the remarkable things about Floridians for Solar Choice is the diversity of its membership. According to In a recent poll, 74% of Florida voters said they would support a proposal to change Florida’s current law and allow Floridians to contract directly with solar companies to power their homes or businesses with solar energy, and the makeup of Floridians for Solar Choice reflects that broad base of support. The impressive list of supporters of Floridians for Solar Choice includes such diverse groups as the Christian Coalition of America, Conservatives for Energy Freedom, Florida Alliance for Renewable Energy, Florida Retail Federation, Florida Solar Energy Industries Association, Libertarian Party of Florida, Republican Liberty Caucus of Florida, Republican Liberty Caucus of Tampa Bay, Southern Alliance for Clean Energy, WTEC, Clean Water Action, Environment Florida, Evangelical Environmental Network, Greenpeace USA, IDEAS for Us, Physicians for Social Responsibility, Florida, ReThink Energy Florida, Sierra Club Florida and The Tea Party Network.

According to a recent article on The Wall Street Journal “…Utilities have long argued that customers should go through them for solar energy because they should help pay for the cost of maintaining the grid, which they still rely on for at least part of the day.”

Sterling Ivey, a spokesman for Duke Energy Florida, which provides electricity in the central and northern part of the state, said the company was committed to working with lawmakers “to achieve energy policies, incorporating solar, that are fair and beneficial to all of our customers.”

As with the wind power industry before solar, many state-sanctioned monopoly utility providers have attempted to hold independent renewable energy generators at bay until the cost of solar production drops to the point at which it is profitable for them to jump in to the market. Now, utility companies like Duke Energy are looking to develop “Community Solar” projects. These “Solar Farms” do offer customers the option of buying clean energy and offsetting dirty coal powered generation, but without the personal and local economic benefits of rooftop solar. In addition, utility-scale solar continues reliance on an aging transmission and distribution system.

“What’s happening now in Florida is really blocking the free market,” said Tory Perfetti, state director of Conservatives for Energy Freedom. Meanwhile, activists in Georgia, Utah, Colorado and Iowa have all recently fought to open up their states electricity market to third party power providers.

Solar growth in states that allow third party power purchase agreement, particularly in the form of solar leases, illustrates clearly that the inability of Floridians to purchase solar power electricity directly from someone other than a monopoly electric utility is one of the major reasons that Florida’s Solar industry has not taken off. In California, for instance, solar installations skyrocketed with the implementation of solar lease agreements. According to a 2013 report from the Climate Policy Initiative:

“Recently, steep solar panel cost reductions as well as strong federal and state policy supports have helped to catalyze substantial growth in rooftop solar PV deployment in California. Interestingly, this growth has happened in the face of declining financial incentives for solar installations at the state level through the California Solar Initiative. This growth has also been accompanied by a shift in market demand: Most homeowners in California are no longer purchasing the panels on their rooftops, they are leasing them. Over 75% of California’s new residential solar systems in 2012 were leased as compared to less than 10% in 2007.”

The fact that solar installations in California went up “in the face of declining financial incentives” is key to the successful alliance of far-right and far left in Georgia, and now in Florida. $0 up-front costs make installation a no-brainer for many people who want to make the jump to solar with little or no additional cost. Small-government, anti-tax conservatives like the “no government incentives” aspect of third party leases, and see it as a free-market solution which provides the individual with more energy independence. They are not required to agree with their environmentalist allies’ carbon-reduction goals or desire to reduce the effects of anthropogenic climate change.

Debbie Dooley, of the Georgia Tea Party and the Green Tea coalition stated the position clearly in an essay she wrote for Grist:

“The premise is simple: Those who believe in the free market need to reexamine the way our country produces energy. Giant utility monopolies deserve at least some competition, and consumers should have a choice. It’s just that simple, and it’s consistent with the free-market principles that have been a core value of the Tea Party since we began in 2009.”

Could the far-right and far-left find common ground on other issues? With the increased influence of corporate money in politics and the increase in government surveillance of citizens, it is within the realm of possibility that we may see these groups reunite again in the future over issues.

The post Enviros and Tea Party Agree: Solar is Good for Florida appeared first on Solar Tribune.

That’s ten times faster than the national average employment growth rate of 1.9 percent between September 2012 and November 2013.

“The solar industry’s job-creating power is clear,” said Andrea Luecke, Executive Director and President of The Solar Foundation. “The industry has grown an astounding 53 percent in the last four years alone, adding nearly 50,000 jobs.”

To paint an even more positive picture, another 22,000 jobs are anticipated in the coming year, thanks to strong demand and supportive policies.

Credit: Solar Job Census 2013

“Tens of thousands of new living-wage jobs have been created over the past year thanks to plunging solar technology costs, increasing consumer demand, and supportive government policies,” said Amit Ronen, Director of The George Washington University Solar Institute, which supported the report, along with BW Research Partnership.

“As the nation’s fastest growing energy source, we expect the solar industry will continue to generate robust job growth for at least the next decade,” Ronen continued.

The data, collected from more than 2,080 solar firms, confirms that whilst other energy generation sectors suffered a decline in job numbers (fossil fuels dropping almost 9 percent), opportunities and wages climbed higher in solar, up to between $20 and $23.63 per hour.

“The study shows both aggressive hiring and clear optimism among US solar companies,” said Philip Jordan, Vice President at BW Research Partnership. “We also found higher than average employment of veterans in the solar industry, a sign that their high-tech skills are valued in this sector.”

Overall, the report suggests an optimistic environment for the solar industry in the United States. A state-by-state breakdown is expected in February.

The post Solar employment up 20% since 2012 appeared first on Solar Tribune.

The report, “Improving Solar Policy: Lessons from the solar leasing boom in California,” examines the growth of solar PV in that state, finding that people go solar mainly to save money on power bills.

According to CPI’s analysis, leased systems don’t pose a cost to taxpayers across the country because the cost of PV systems has declined and so have federal government incentives. Specifically, the decline of the California Solar Incentive helped bring down prices for rooftop solar, and thus a drop in the cost of the incentive scheme to taxpayers.

Credit: CPI

CPI also found that declining government incentives – which previously encouraged homeowners to buy systems – have increased demand for leasing programs.

Some argue that government incentives should be reduced because such programs essentially mean that all state or federal taxpayers are subsidising the cost for those who do choose to go solar. And a few years ago, incentivizing solar leasing actually cost taxpayers more than purchased systems.

But CPI finds that to no longer be the case, stating that “[l]easing companies make it easier for many customers to realize the benefits of rooftop solar,” but not all states allow leasing.

The think-tank recommends leasing incentive programs that draw down over time, but concludes that solar leasing is just one part of the energy mix.

“Solar leasing has filled and will continue to fill a gap — converting long-term energy savings from a relatively large investment into a product that provides immediate financial benefits,” says the report.

“However, leasing is likely not the only way in which business and/or policy innovation can make it easier for consumers to benefit from renewable generation.”

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The upcoming Marketbuzz report concludes that PV demand last year reached 29 GW – lower than recent estimates of 30 to 32 GW from the European Photovoltaic Industry Association – which is a rise of just five percent from the 27.7 GW level of 2011.

“During most of 2012, and also at the start of 2013, many in the PV industry were hoping that final PV demand figures for 2012 would exceed the 30 GW level,” said Michael Barker, Senior Analyst at NPD Solarbuzz.

“Estimates during 2012 often exceeded 35 GW as PV companies looked for positive signs that the supply/demand imbalance was being corrected and profit levels would be restored quickly. Ultimately, PV demand during 2012 fell well short of the 30 GW mark.”

This five percent annual increase represents the first time in a decade that PV market growth has been below ten percent.

2012 PV Demand by Region. Credit: NPD Solarbuzz Marketbuzz report

In a breakdown of global PV demand for 2012, NPD Solarbuzz found that Europe made up almost 60 percent of total demand with 16.48 GW, with Asia coming in second with 8.69 GW of demand.

North America, Latin America and the Caribbean made up 13 percent of demand for solar but a large part of that was solely from California, which the report attributes to the state’s Renewable Portfolio Standards and rebates.

Although the 29 GW of PV added in 2012 is an annual record, the research firm says the figure is disappointing compared to expectations.

“For supply and demand to have been balanced during 2012, end-market demand should have approached the 45 GW level,” said Barker.

“This is 50% higher than actual PV demand in 2012, and reflects the lack of demand elasticity that characterizes the PV industry today. It also explains why even those companies that gained market-share in 2012 still ended up reporting significant operating losses.”

The research firm predicts that 2013 will see growth from developing regions like Latin America, the Middle East and Africa, and some parts of Asia.

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That record figure comes from a new report from research firm PV Solar Report and Sunrun, a residential solar firm that specialises in third-party owned solar.

Third-party ownership – in the form of solar leasing and purchase power agreements (PPAs) – means that homeowners pay for the electricity generated from PV panels, but the system is owned and maintained by a company like Sunrun.

Top cities for PV in California, 2012. Credit: PV Solar Report

These figures cover the total dollar amount of solar contracts for 2012, and indicate that third-party ownership generated as much in the last 12 months as for the previous five years in Californai.

“Nearly 75% of homeowners who went solar in 2012 chose third-party-owned, compared to 56% in 2011,” said Stephen Torres, Founder and Managing Director of PV Solar Report.

“We are seeing the most growth in low and median-income zip codes as companies like Sunrun continue to remove the barriers to access.”

The report also looked at top solar cities in California for 2012, based on the value of system contracts, with San Diego, San Jose and Bakersfield topping the list.

“Solar service is bringing solar to more American families not only because it eliminates the upfront cost, but also because it removes the hassles of ownership,” said Sunrun co-CEO Lynn Jurich.

“Homeowners feel the impact of a tight economy and are looking for ways to own less in order to save more money. Our business model meets those needs, plus it helps the planet.”

The post Almost $1bn generated by 3rd party PV in California in 2012 appeared first on Solar Tribune.

NPD Solarbuzz Vice President Finlay Colville said the outlook looked even more grim for 2013, with spending set to be just $2.2 billion – a fall to a level not seen since 2006.

Suppliers of equipment to photovoltaic cell and module manufacturers received masses of orders in 2010 and 2011. Now, according to NPD Solarbuzz, PV manufacturers are not investing in upgrades or new technologies.

“Spending on high-efficiency process steps barely contributed to 2012 shipments, representing less than 5% of PV equipment spending,” said Colville.

“PV equipment suppliers now find themselves a victim of their own success,” he added.

Forecast PV-Specific Metrics for the Top 10 PV Equipment Sector to Q4’13 Source: NPD Solarbuzz

The surge in investment is part of what led to the global oversupply of solar panels, and the concurrent freefall in prices that led many PV manufacturers to go bankrupt.

While spending on PV equipment isn’t predicted to bounce back for at least three years, Colville stressed that PV equipment suppliers must focus on “enhancing efficiency and understanding which technology roadmap will help them gain market share when spending finally returns.”

The post Investment in PV equipment fell 72% from 2011 to 2012 appeared first on Solar Tribune.

That’s according to the U.S. Solar Market Insight: 2nd Quarter 2012 report from GTM Research and the Solar Energy Industries Association (SEIA). The 742 MW installed in Q2 represents a 45 percent increase over Q1 2012 and is 116 percent more than was installed in Q2 2011.

The report credits the spike in installations to a record 477 MW of utility-scale installations, as well as an additional 98MW in the residential sector, too.

“The U.S. solar industry is rapidly growing and creating jobs across America despite the slow economic recovery,” said Rhone Resch, president and CEO of SEIA. “More solar was installed in the U.S. this quarter than in all of 2009, led for the first time by record-setting utility-scale projects.”

“With costs continuing to come down, solar is affordable today for more homes, businesses, utilities, and the military,” said Resch. “Smart, consistent, long-term policy is driving the innovation and investment that’s making solar a larger share of our overall energy mix.”

U.S. Solar PV Installations, 2010–Q2 2012 Credit: U.S. Solar Market Insight, 2nd Quarter 2012

The non-residential market – comprising commercial and government owned PV – did not experience the same level of growth as the utility sector, but instead installations fell to 196 MW in Q2, down from 291 MW in the first quarter.

The report also noted the popularity of third-party owned solar models, like solar leasing and PPAs, with California, Arizona and Colorado having over 70 percent of new residential solar under a third-party model. “We’re starting to see innovative PV business models take a substantial hold in the U.S. residential market,” said Shayle Kann, Vice President of Research at GTM Research.

“The success of third-party residential solar providers has attracted more than $600 million in new investments in recent months,” said Kann. “This influx of cash into the residential space signifies the growing acceptance of solar leases and power purchase agreements as a secure investment for project investors. We expect that third-party installations will claim even more market share in the coming quarters.”

After last quarter’s growth, the U.S. has installed solar capacity of 5,700 MW, which is enough to power over 940,000 homes. SEIA and GTM Research predict a total 3,200 MW of photovoltaic capacity to be installed in 2012, up 71 percent from 2011.

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That’s up from $329 million in Q1 2012, according to the Q2 Solar Funding and M&A Report.

“With news of solar companies downsizing or going out of business seemingly every day, continued steady VC investment activity in the sector is good news,” said Raj Prabhu, Managing Partner at Mercom Capital Group.

“Since 2011, most solar VC investments have gone to thin film companies with $835 million, and with panel prices falling more than 60 percent over the same period, solar downstream companies have been an attractive play,” said Prabhu.

Downstream solar – such as solar leasing firms – received the most investment this past quarter, and while declining PV module prices have meant balance-of-system costs are the biggest cost involved in going solar, investments in this sector have been “surprisingly low.”

Mercom Capital also counted 13 new solar-focused investment funds, with a total of $3.2 billion committed.

On the flip side, there were 13 bankruptcies and insolvencies last quarter, seven of which were thin-film companies.

Sixteen companies also announced restructuring and downsizing, and despite Q2’s uptick in venture capital deals, according to the report “the average VC deal size has been consistently dropping since 2010 with large VC deals becoming rare.”

Read the full report here.

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This news comes a day after China’s Ministry of Commerce accused the U.S. of illegally subsidizing six renewable energy projects, violating World Trade Organization agreements.

According to the New York Times, deputy director for solar products at the China Chamber of Commerce for Import and Export of Machinery and Electronic Products Chen Huiqing said Chinese PV panel makers “face challenges of decreasing margins, decreasing exports, lack of capital, protectionism and an external environment that continues to deteriorate.”

These sentiments were echoed in a statement from Trina Solar CEO Jifan Gao, who attributed the net loss to declining solar panel prices, caused by “industry overcapacity and demand constraints.”

Gao noted “uncertainty caused by changes in the system of feed-in-tariffs in markets such as Italy, the influence of potential anti-dumping tariffs in the United States, inventories due to project delays from U.S. customers that made purchases under the U.S. federal government’s 1603 Program” as key factors that dampened demand.

Major Chinese PV manufacturer Yingli Solar's 2MW installation in Salerno, Italy. Credit: Yingli Solar

These poor Q2 results come in the midst of an extended trade war that has resulted in the U.S. imposing tariffs of up to 250 percent on Chinese PV imports – a move the U.S. Commerce Department says will level the playing field for U.S. producers.

Just last month, a group of EU producers filed a similar complaint with the EU Commission, seeking anti-dumping and anti-subsidy tariffs on Chinese PV imports. The EU is a much larger market for Chinese exports, meaning Chinese firms could face even bigger challenges if the complaint is investigated.

Meanwhile, Chinese firms have lodged a complaint with their own Ministry of Commerce, charging that U.S. firms are selling polysilicon in the Chinese market at below-cost prices. And Monday’s announcement accusing the U.S. of unfairly supporting renewable projects is a further sign that the Chinese government is considering fighting back in this trade brawl.

But while the Ministry said the U.S. had broken WTO trade rules, it did not indicate whether these complaints would be formally brought to the WTO dispute settlement body.

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SolarWorld is Germany’s largest manufacturer of solar panels, and has spearheaded the push for tariffs on Chinese PV imports to the U.S. and the EU.

The firm announced a net loss of $197 million (159.3 million Euros) for the first half of 2012, with revenue down 36 percent over that period. The company attributed the net loss to write-downs on inventory, and the decreased revenue to price dumping.

The company revised forecasts for the fiscal year, saying it would not generate positive earnings before interest and taxes in 2012 thanks to an “aggressive market situation characterized by illegal trade practices.”

SolarWorld's U.S. HQ in Hillsboro, Oregon. Photo Credit: SolarWorld

After the news broke, SolarWorld’s shares fell 12 percent, and have dropped 83 percent over the past year.

But SolarWorld tried to put a positive spin on the situation, simultaneously announcing an additional 60 million Euro investment into technology that will improve module performance but decrease production costs.

“We have to fight price dumping with technological innovations,” said Frank Asbeck, CEO of SolarWorld.

SolarWorld, as part of two industry groups, has lodged trade complaints against Chinese firms with the U.S. Department of Commerce, the International Trade Commission and, most recently, the EU Commission.

In the U.S., Chinese firms face tariffs of up to 250 percent for PV imports. The EU Commission has yet to decide whether it will launch an investigation into Chinese PV imports entering the EU.

But despite SolarWorld’s successful campaign in the U.S., which has coincided with a drop in Chinese PV imports, the company has still struggled in a global market facing both oversupply and diminishing government support for solar.

“Solarworld’s weaker earnings is the result of the entire industry being under pressure for various reasons and it’s definitely not accurate to just point fingers at Chinese companies,” Arthur Chen, general counsel at Yingli Green Energy, China’s second-largest solar-panel manufacturer, told the Wall Street Journal.

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Global investment was down to $1.6 billion, from $1.9 billion the previous quarter, and $2.1 billion in Q2 2011. That’s a 25 percent drop in one year in investment for green technologies like solar, wind and electric cars.

Photo Credit: CalFinder

The report finds the main culprits to be the continued global economic downturn and increasing political opposition to government support of cleantech.

Cleantech CEO Sheeraz Haji noted that IPOs in the U.S. did not look promising: all initial public offerings in Q2 2012 came from China, while a few American companies – including BrightSource – had cancelled their IPOs. “It’s safe to say the U.S. IPO market is effectively shut,” said Haji.

There are still some companies that have promise, Haji noted, such as a few firms specialising in solar financing and installation. “I think that the world of SolarCity, SunRun, Clean Power Finance, is in a great place,” he said.

Nevertheless, the outlook remains grim for solar manufacturers, who continue to face strong competition from Chinese firms.

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GTM Research and the Solar Energy Industries Association (SEIA) released the U.S. Solar Market Insight: Q1 2012 report, released June 13, found that a record-breaking total of 506 MW of capacity was installed during the first three months of 2012. This expansion was in large part due to growth in the commercial market for PV.

Now the country has a PV capacity of 4427MW, plus 516MW of concentrating solar power (CSP), bringing the total solar electric capacity to 4943MW, enough to power 775,000 households.

US PV Installation Forecast by Market Segment, 2010-2016. Credit: SEIA and GTM Research

“The U.S. solar industry continues to lead the U.S. out of difficult economic times,” said Rhone Resch, president and CEO of SEIA. “Installations have grown by 85 percent in the last year.  This growth is coming from consumers who are turning to solar to reduce their energy costs.  In states across the country, Americans are waking up to the realization that putting solar on your home or business is a better investment than the stock market.”

The report predicts that total PV installations this year will exceed 3200 MW. That’s 75 percent more than the total for 2011, and 15 percent more than previously expected. The positive forecast is a result of the following:

• accelerated schedules for utility-scale projects
• higher than expected growth in New Jersey’s commercial PV sector
• many safe-harbored projects that will still qualify for the 1603 Treasury Grant program that expired at the end of 2011, and
• high growth particularly in California, Massachusetts and Hawaii

According to the SEIA and GTM Research, 2012 will be another “banner year” for photovoltaics in the U.S. However, the report noted that the year would be a difficult one for domestic solar panel manufacturers, thanks to strong global competition and the brewing trade disputes.

Furthermore, the global market is still dealing with the polysilicon oversupply from 2011, manifested in the form of low prices for panel components.

As a result, U.S. manufacturers produced less than half the amount of solar panels in Q1 2012 than in Q1 2011 – 160 MW compared to 335 MW. Module prices were 47 percent lower than one year ago, down to $0.94 per watt, and the overall average installed price fell 17.2 percent year-on-year.

“We remain bullish in 2012 on all market segments in the U.S. and most of the 23 states we cover in this report,” said Shayle Kann, Vice President at GTM Research. “However, 2013 is an open question. The impacts of an import tariff on solar cells imported from China, as well as the expiration of the 1603 Treasury Program, will be felt most next year.”

“This could coincide with a trough of demand in New Jersey and California’s adjustment period into a post-California Solar Initiative (CSI) world to create a temporary slowing of growth. However, we expect the U.S. market to regain momentum thereafter and continue along its path to become a global PV market leader by 2015.”

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The report, the latest in the PV Equipment Quarterly series, looked at tier 1 PV manufacturers. The research firm found that this growth will be stimulated by the consolidation of the PV market, as uncompetitive firms are either downsizing or going out of business.

“Capacity taken offline is just one reason why PV equipment suppliers are planning for future growth. Tier 1 manufacturers are also choosing to run existing production lines at reduced utilization rates during 2012, while increasing the level of outsourced wafers and cells,” said Finlay Colville, Vice President at NPD
Solarbuzz.

“This is helping to restore a healthier supply-demand balance to the PV industry, thereby removing the underlying deterrent holding back the release of new CapEx [capital expenditure].”

Tier 1 PV Equipment Spending Credit: NPD Solarbuzz PV Equipment Quarterly

PV equipment revenues fell to $1.75 billion in Q1’12, a 10-quarter low, down 51 percent year on year. But NPD Solarbuzz says that after six quarters of negative growth, the capital expenditure downturn will bottom out during the next quarter.

The report notes that most equipment suppliers will see a year-on-year PV-related revenue decline of 60 to 80 percent, and that firms focusing specifically on the PV industry will be hit especially hard.

“Supplier rankings are undergoing a transition phase in 2012, with significantly less revenues on offer to the PV equipment supply chain,” said Colville.

“The leading PV equipment suppliers during 2012 may be those able to recognize the most deferred revenues that were accumulated as PV backlog by the end of 2011, or those already secure as preferred suppliers to tier 1 producers adding new capacity during 2012.”

Read the full report here.

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Despite the lower price of PV panels, due to last year’s increased supply, Bloomberg reports that better than expected profits sent solar share prices higher on Friday.

Photo Credit: CalFinder

The Arizona-based First Solar also announced approval for a major PV project in California that had been held up due to permitting issues.

These announcements raised these firms’ share prices by 18.9, 11, and 7.3 percent respectively. This good news also raised other solar panel makers’ share prices.

Just the day before, Bloomberg reported that HSBC analysts predicted a “flat” market for PV panel installations in 2012.

“We continue to suggest investors stay cautious given our expectations of flat global installation growth and flat pricing outlook in 2012,” HSBC analysts led by Joseph Jacobelli said in an email. “The sharp surge in January was a result of volume surprises in a number of countries, namely Germany, China, the U.K., Belgium, France and Greece.”

The bank predicts that worldwide solar panel installations will be lower than last year’s 26 GW, at 25.5 GW for 2012.While HSBC forecasts higher installations for China and India, analysts lowered its forecast for U.S. installations for 2013. They expressed concern about financing for large projects and the impact of low gas prices on demand for PV.

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The December 14 predictions include falling module costs (up to 20 percent by years’ end), growing popularity of solar leasing, especially amongst the middle class, and breakthroughs in supporting technologies that will help to make solar more affordable.

The solar power service provider’s most interesting statement, though, was calling 2012 a “Darwinian year” for solar. Citing market oversupply and the expiration of the 1603 Treasury Grant Program as factors that may push solar energy firms out of business, SunRun claimed “this consolidation will clarify the industry’s enduring leaders.”

A home with solar panels leased from SunRun. Photo Credit: SunRun

“Without the grant program consumers lose out because clean energy becomes more expensive and less accessible,” said SunRun spokesperson Susan Wise, according to Clean Energy Authority.

“As a market leader we will continue our success without the grant program, but we prefer that it be extended so we can offer the most affordable solar to more homeowners and more middle-class families.”

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