Picking solar’s Rising Stars

Lux Research bets on PV module makers.

Lux is betting on a select few of 127 photovoltaic module makers that will emerge from the solar shakeout.

It’s been a sobering year in the solar market. Oversupply has forced module makers to reduce prices as much as 30% in the past twelve months. Despite the looming shakeout, expectations of future growth still attract new challengers to an industry already overcrowded with competitors and a tangled mix of technology platforms. Only a select few will emerge as dominant.

Entitled Sorting Solar Module Makers on the Lux Innovation Grid, the report provides suppliers, customers, and investors with Lux Research’s proprietary visual model that quantitatively compares 127 module makers according to their technical value, business execution, and maturity. While a select few are currently well positioned to emerge from the shakeout–the Lux Innovation Grid is a snapshot in time, looking at three major metrics.  Others may well succeed.

“The core value of this report is being able to see top module makers all ranked in one place,” said Johanna Schmidtke, an analyst at Lux Research and the report’s lead author. “It allows readers to compare different technology classes, as well as to benchmark the companies operating within each class against each other.”

Background

A solar cell is any device that directly converts the energy in light into electrical energy through the process of photovoltaics.  Solar cells date as far back as the French Physicist Antoine-César Becquerelas in 1839. Today, the most ubiquitous solar installations are made from silicon, which is in high demand, driving prices up.  However, the landscape is changing as new developments, especially in materials, bring better products to market.

Silicon Wafers

The most widely used photovoltaic (PV) today is crystalline silicon (x-Si).  The silicon is processed into a cylinder like structure of various shapes and sliced into wafers—much like slicing salami.  These wafers are then placed onto the familiar panels seen on roofs, arrayed in rows in sunny areas like desserts, or designed to fit specialized uses on commercial buildings.

One of the challenges facing traditional solar panels is that while PVs have become increasingly efficient, they have not reached the 20% mark.  (Joanna  Schmidtke noted that SunPower is close with up to 19% module efficiency.)  Efficiency, combined with the cost of silicon, affect the long term pricing of solar panels.

Thin Film

Thin film is made by applying a thin film (thus the name) onto a subsurface–often a flexible material.  One example of a thin film on a hard substrate is a household mirror, which has a thin metal coating on the back of a sheet of glass.  The biggest drawback to thin film has been production, which has kept prices high and quality an issue.  However, the advantages–flexibility, higher density, and reduced use of increasingly expensive silicon–has driven successful innovation.

Although  thin film most commonly refers to silicon (TF-Si), there are two other process that use thin films, but other element formulations. These are cadmium telluride (CdTe) and copper indium gallium diselenide (CIGS).

Organic and Grätzel PV

Organic PV is one of the newest technologies, with challenges and opportunities.  According to Peter Fairley in IEEE, organic PV’s are based on carbon-based dyes and polymers as opposed to silicon.  Such PV cells weigh next to nothing, bend without breaking, and are rapidly improving.  The U.S. Defense Advanced Research Projects Agency (Darpa) looks to organic PVs to cut battery load in half, providing soldiers in the field with readily rechargeable energy source. However, the process is still working out kinks.

Concentrated photovoltaics (CPV)

Concentrated Solar

Concentrated photovoltaic (CPV) technology is really a hybrid in that it uses a physical structure to intensify sunlight onto a silicon surface.  CPV concentrates sunlight through a lens onto high performance solar cells, which increases the electricity generated. Panels are often mounted on tracking systems to maximize the benefit of each ray of sunlight. In some instances,  an array of mirrors are focused around a single source such as a tower.

Another approach is to use concentrated sunlight to heat water, in a variant of solar thermal.  The water is in turn converted to steam to drive electric generation.  In the example at the right, a mirrored trough concentrates sun on a tube of water. The hot water is then additionally heated to create steam which turns a turbine to create electricity.

Concentrated photovoltaic technologies scale to utility size, generating power for multiple locations from one installation.

Lux Report

Based on information gathered in over 200 interviews with industry executives, the report encompasses solar technologies including crystalline silicon (x-Si), thin film silicon (TF-Si), cadmium telluride (CdTe), copper indium gallium diselenide (CIGS), concentrated photovoltaics CPV), and organic and Grätzel PV. It rates companies within these fields on the Lux Innovation Grid to identify dominant, undistinguished, long-shot, and high potential players. Among its conclusions:

• Select x-Si module vendors continue to dominate installation markets. Improved polysilicon pricing should help cement crystalline silicon’s advantage in most installation markets through next year. Players such as Sanyo Electric, SunPower and Sharp Electronics are best positioned to pursue tailored, high-efficiency products for the residential market.
• Thin-film PV will gain market share in commercial and utility. Aside from First Solar, the thin film PV market is wide open, with no companies clearly dominating and many at risk. Their future survival depends on how well they grow capacity, deliver performance and reliability, and prove cost competitive over x-Si. First Solar, meanwhile, will compete against x-Si module makers for utility-scale installations in the U.S. and China.
• A mixed bag of CIGS start-ups shows no clear leaders. As a group, CIGS start-ups show a range of technical value and business execution scores, but none have mastered both dimensions yet. Solibro and Solyndra offer strong technical value, but still lack the business execution to dominate the field. Similarly, Johanna Solar Technology and Showa Shell Sekiyu present convincing business execution scores, but haven’t yet shown the differentiated technical value needed to make a true impact.

“Unlike the battery industry, where end applications are very diverse, solar is populated by a lot of module makers all targeting the same few applications: utility, commercial, and residential installations,” said Schmidtke. “The Lux Innovation Grid will give readers a sense of who’s ahead, who’s behind, and who’s just treading water.”

Sorting Solar Module Makers on the Lux Innovation Grid is part of the Lux Solar Intelligence service. Clients subscribing to this service receive ongoing research on market and technology trends, continuous technology scouting reports and proprietary data points in the weekly Lux Research Solar Journal, and on-demand inquiry with Lux Research analysts.

About Lux Research

Lux Research provides strategic advice and on-going intelligence for emerging technologies. Leaders in business, finance and government rely on us to help them make informed strategic decisions. Through our unique research approach focused on primary research and our extensive global network, we deliver insight, connections and competitive advantage to our clients. Visit www.luxresearchinc.com for more information.

Thin film production