PV industry history: We’ve come a lot farther than we think

2009 presented many challenges to the PV industry, and there’s probably at least one more tough year ahead. But a snapshot at the past decade’s milestones reminds that this is an industry that has repeatedly shown its ability to persevere long before the benefits of incentives and MW-scale projects, notes Navigant Consulting’s Paula Mints.

by Paula Mints, Navigant Consulting

December 14, 2009 – 2009 is ending and with it a decade of significant upswings in sales and prices, and swoops downward of sales and prices. A severe raw material shortage constrained supply for at least four years during the strongest burst of demand the PV industry had ever seen (2004-2008, compound annual growth of >50% a year).

In 2000, Germany began its history making EEG (feed-in tariff), and in 2002 Japan ended its history-making residential rooftop subsidy (and started an FiT in November 2009). In 2001, California utility PG&E filed for bankruptcy protection, from which it emerged relatively unscathed. Also in 2001, polysilicon manufacturers Tokuyama, Wacker, MEMC, Elkem, Hemlock, Advanced Silicon Materials, and Deutsche Solar (SolarWorld) began plans to produce solar-grade silicon, at target prices of $20/kilogram (contract) and $40/kilogram (spot). (During the 2004-2008 boom, with the shortage of polysilicon constraining sales, spot prices topped $400/kilogram.) In 2002, BP Solar shut down all thin-film research, development, and production assuming that the technology would never gain significant share. In 2009, First Solar — a manufacturer of thin-film CdTe technology — will be the top manufacturer of technology in the world.

2009 presented many challenges to the PV industry: a global recession, financial crisis, loss of a major market, significantly low pricing that depressed manufacturer margins, and slowly recovering debt markets. Nevertheless, research and development, sales, and the creation of new business plans carried on. Start-ups raised funding despite a brutal investment climate. Multi-megawatt projects were announced.

Frankly, the PV industry likely has at least one more challenging year ahead, but it will persevere; meanwhile, sales are still in the gigawatt range. The table below is a gift to all those who remember when, and continue to forge ahead because they have a vision. For those who are new to the industry and who have embraced it, and for interested observers, it’s a gift of perspective and understanding from the few who persisted with little government support, no incentives, and sales of <2MWp, to the multifaceted and fast-changing industry we have today.

Click to Enlarge
Milestones from 1979 to 2009.

Paula Mints is principal analyst, PV Services Program, and associate director in the energy practice at Navigant Consulting. E-mail: pmints@navigantconsulting.com.

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