Analyst: Module sales outlook “cloudy” for 2011

Module shipments have risen six consecutive quarters, but be prepared for a sharp decline in the first quarter of 2011 as clamor over FiT cuts subsides and seasonal patterns reestablish, says IMS Research.

July 22, 2010 – Module shipments have risen six consecutive quarters, but be prepared for a sharp decline in the first quarter of 2011 as clamor over FiT cuts subsides and seasonal patterns reestablish, says IMS Research.

In late 2009/early 2010 there was much speculation about what cuts would be applied to existing incentive schemes, particularly in Europe. This drove demand to get PV solar projects finished and installed before anything happened, and suppliers responded by hiking their production capacity to meet demand. But with incentives changes getting hashed out, the pace of installations should decrease substantially — by nearly 40% from 4Q10 to 1Q11, predicts IMS research analyst Sam Wilkinson, in a statement. (He recently wrote a more in-depth analysis of PV module shipment trends.) “Huge capacity expansions” are still happening, though. So, look for “a sharp slowdown” in module shipments starting in 4Q10.

And that will have a damaging effect on module prices, too, which after declining by an average of 10%/quarter in 2009 had slowed and even slightly increased in 2010, thanks to high demand. Factory-gate prices of crystalline-silicon (c-Si) modules fell just 2% (in Euros), despite a finalized reduction in Germany’s FiT to 11% at year’s end, and actually went up about 1% (again in Euros) in 2Q10. But now, IMS predicts prices will drop again in 1H11 — by 8% in the first quarter of 2011 alone.

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PV module shipments and production capacity. (Source: IMS Research)

 

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