Intersolar, the largest tradeshow in the solar industry in North America, just took place in San Francisco this week. It is a good time to take a step back and analyze where the industry is going. If consolidation continues for sure, the market remains vibrant with new initiatives like energy storage.
The solar PV market is slowly making a transition from a subsidized model to a market-driven model where solar is to be better integrated into the grid. At the PV Energy World pavilion, technologists from various countries presented their views on the intersection of the solar semiconductor and energy sector, and what it could look like in a few years. In the meantime, quite a few new solar products made their debut this year. Overall, here are the top-5 trends in solar:
- Consolidation. From bankrupties to product integration, the largest companies offer more and more solutions and many solar PV companies continue to close doors. And China is not exempt from the market shake-out with more than 50 manufacturers closing doors. On the other end of the spectrum, the top-20 companies were very visible at Intersolar. I talked to SolarWorld, the Germand American company that is the largest manufacturer of PV in the US . Relieved to see the World Trade Organization putting some pressure back on chinese manufacturers practicing "price dumping", they see their business evenly shared among utilities, commercial and residential applications.
- Vertical integration. A corollary of the current market pressure is a better integration of the various components to install PV panels, from manufactured cells to systems under warranty on a roof or in a farm. The word out this year is that the installed cost is now under $5 per Watt. Asian companies like Suntech offer full solutions. FirstSolar continues to be strong in North America with its thin-film technology despite recent changes to adapt to the market. Engineering, training, and turn-key solutions are becoming widely available.
- Energy storage and the end of net metering. The subject of grid integration (picture above) was a hot topic and net metering is under scrutiny. By design, the grid will have difficulty to integrate renewable energy like solar without storage. Many utilities are moving to time-of-use and the State of California just passed a new bill on energy storage (AB 2514) that should take effect in 2015-16. The general availability of Electrical Vehicles is also putting more pressure on grid utilities to act.
- Innovation continues. From intelligent systems at homes to trackers on solar farms, new products were announced this year while many vendors are struggling. My pick: the first module-integrated DC to 3-phase AC inverter from Array Power. The first generation of single-phase inverters are now well integrated into the distribution chain for home roof installation. It will be interesting if indutrial players feel comfortable enough to put solar in their factories with 3-phase inverters.
- Germany 2 - China 1. If we were to keep scores and pick the "champion" in the solar sector, I would have to go with Germany. China is clearly leading on the manufacturing side with the traditional model. Yet, Germany has taken notice of the move to a market driven sector and have already lowered feed-in tariff but continues to fund innovative research and new business models so solar can become viable on the grid on its own merit. If Western and Southern States represent important markets, the US is not leading the world of solar because of a lack of coordination among states and a national debate on energy policy, which does not have an end in sight. Natural Gas will likely get most of the subsidies in the US in coming years unlike in Germany and China.
The first annual Intersolar awards were given this year to innovating projects in North America integrating advanced technoloy, architectural aesthetics, and outstanding services. North Carolina is a clear leader with two of the three awards, including one high-efficiency PV installation on a school campus.
North Carolina also made the news this year for the data centers that Apple and others are building there. Solar is making in-roads in non sunny States with higher overall efficiency and lower costs. That is the brightest news for the solar industry. The sector is not dead.
Intersolar was at the Moscone center where Apple's and Google's developper conferences were organized. Like them, Intersolar was packed. But the solar sector is certainly going through a tough transition.