Lessons Learned from the Trina Solar Boom

When a company grows from 7,900 employees at the end of 2009 to 17,000 in May 2011, people start to talk.

For Trina Solar, the PV manufacturing business is booming. In 2010, demand for Trina Solar modules was so strong that there were two to three requests for every one module produced, said Thomas Young, senior director of investor relations.

During a May 10 media tour of Trina Solar’s manufacturing facility in Changzhou, China, about 30 journalists, including myself, were able to see some of the processes that have positioned Trina Solar’s modules in such high demand. 

Trina Solar’s incredible growith is part of a much bigger picture: the rapidly expanding Chinese market. Even beyond the solar landscape, consider that in 2005, only 13 Chinese companies made the Fortune Global 500. Just five years later, 46 companies made the list. In addition to growing market, China graduates about a million engineers a year. And with China leading the world in PV exports, it’s only natural that many of China’s brightest turn to the solar manufacturing market.

Improving Quality

In the past, Chinese-made PV panels may have been perceived as cheap or lower quality than their American or European-made counterparts. Adam Krop, senior solar analyst, Ardour Capital, said that China has learned ways to enhance quality and establish a better reputation in the last few years. These tactics include developing stronger research and development through international institutions and universities, and enhancing test site performances.

“To many Western solar companies, Chinese manufacturers were previously lacking in quality,” Krop said. “But steps such as these may be monumental in changing these perceptions.”

Trina Solar is one of the many Chinese manufacturers that has made tremendous steps in testing as well as R&D. During the tour, we were shown a number of different tests conducted at Trina Solar’s “Center of Excellence” lab to ensure the quality of their product, including:

• Hot spot endurance test, which determines the ability of the module to withstand intermittence, reverse voltage or current while leaving no evidence of electric shock, smolder or burn.
• Humidity-freeze test
• UV test
• Mechanical load test, which proves that the modules can withstand a snow height of nearly 6’. Modules are also tested under extreme weights to ensure their ability to withstand debris that could hit them during hurricanes or tornadoes. Trina employees demonstrated the ability of the modules to endure such weights by hurling a 100-pound sand bag at a panel – and of course, the panel survived unscathed.

Trina Solar has also sought to develop international R&D in an effort to establish greater reputability, including a liaison program with MIT that allows Trina Solar access to its resources and staff. Trina Solar also collaborates with SERIS, Singapore’s national institute for applied solar energy research, to develop processing technology. The company has also signed a research agreement with Australia National University for the development of industry-ready n-type monocrystalline solar cells with efficiency up to 20 percent.

Price Tag

These developments in quality assurance add value to the reasonably low price tag associated with the modules. On average, Chinese manufacturers offer PV products that are 10 percent cheaper than their European, Japanese, or American competitors. Trina Solar’s 1st Quarter 2011 results indicate that their panels cost about $1.73/W.

“I would consider them one of the cost leaders in the space – both for the East and West,” Krop said.

Trina Solar partially attributes the ability to produce a low cost module to its single-campus format: 13,000 of the company’s employees work at the manufacturing facility in Changzhou.

“A single campus allows for better utilization of the staff and optimal yield and quality throughout the manufacturing process,” said CEO Jifan Gao.

With global gas prices on the climb, concerns about increased costs for solar manufacturing may arise. But transportation accounts for only about 1 percent of the cost per module, according to Trina Solar’s Young. “Transportation costs are going up, but it’s happening as cell efficiency increases.”

Efficiency improvements in modules lead to a decrease in the number of containers that have to be shipped. In 2009, Young said, it took 11 containers to make 1 MW worth of module capacity. Now it takes only nine packages to make 1 MW. In addition, packaging has improved. Trina Solar previously packaged only two modules per box, but they now safely and efficiently package 20 modules per box.

Installations

In 2010, Trina produced PV for 1,057 MW of installations. Currently, 24 percent of its market share is in Germany, 22 percent in Italy, 22 percent in Spain, 14 percent in the U.S., 3 percent in China, and the remainder of the installation pie is spread among France, Belgium and other nations.  

China, a nation driven by more than 80 percent coal capacity, is slowly beginning to integrate more renewables into the mix. Recently, China doubled its goal for solar integration. The new target calls for 10 GW of installed photovoltaic power capacity by 2015. The government has also raised its installed solar capacity target for 2020 to 50 GW, up from the previous goal of 20 GW.

It only makes sense that Trina Solar, one of China’s largest solar manufacturers in the leading nation for exporting PV products, would develop this energy resource in its own backyard. Gao cited his nation’s new solar target during our tour, expressing Trina Solar’s enthusiasm to be a part of the expanding Chinese solar market.

Trina Solar’s market in North America is expected to continue to grow. Based on Trina’s fourth quarter earnings announcement on Feb. 22, production allocations have assigned 20 percent to North America for 2011. To date, Trina Solar has provided for completed installations at the 2.4 MW solar rooftop project on the Atlantic City Convention Center in New Jersey as well as the 5.3 MW solar plant at the Colorado State University campus in Fort Collins, Colo. In recent news, Fotowatio Renewable Ventures began construction on the 30 MW Webberville Solar project in Austin, Texas, which will use crystalline 270 W photovoltaic modules from Trina Solar. It is scheduled to be operational by the end of 2011.

Despite solar developments slowing in Europe, Trina Solar is moving aggressively into the Belgian market in particular. In December 2009, Trina Solar completed a 40-MW installation that was at the time the world’s largest rooftop PV system. It was installed at the headquarters for global logistics service provider Katoen Natie in Antwerp, Belgium. Trina Solar also recently announced that its German affiliate, Trina Solar Germany, has signed a sales agreement with Mohring Energie for the delivery of 130 MW of Trina’s solar modules in the second and third quarter of 2011.

Business is booming for Trina Solar. And as price continues to be the main concern for solar developers, it’s likely that business will be good for the near future.

Disclosure: Trina Solar paid the expenses for my visit to their facility.