18 Feb 2011
Photovoltaics giant SunPower identifies Italy and the US as two of the key markets driving growth in 2011, and rival Yingli agrees.
Vertically integrated photovoltaics companies SunPower and Yingli are forecasting very strong growth in 2011, as demand from Italy and the US in particular take up the expected slackening in business from Germany, the world’s largest market for solar electricity.
California-based SunPower closed out 2010 with a very strong quarter, registering annual revenue of $2.2 billion on photovoltaic installations with an aggregate capacity of 546 MW.
That represented annual revenue growth of 46%, and although the rate of growth will slow in 2011, SunPower said that it expected to recognize 875 MW worth of installations this year, and post a 30% increase in revenues to between $2.80 billion and $2.95 billion.
The 2011 forecast is also based on good visibility, with SunPower saying that it is 90% booked to its guidance for the year. Much of that demand is emerging from the US and Italy, it explained. In Italy, the company is working on a large number of mid-sized utility installations ranging from 5 MW to 19 MW in peak output power, with more than 130 MW expected to be installed in 2011 overall.
The story in North America is a similar one for this year, with at least 85 MW (peak) of installations in construction and slated for completion by SunPower in 2011. But over the next few years the picture in North America will change, with some much larger projects in the pipeline. These include the 250 MW California Valley Solar Ranch, which SunPower recently agreed to sell to NRG Solar and which it expects to complete in 2013.
Cost reduction plan
Announcing its results only a few days after the US Department of Energy (DOE) set out its “SunShot” vision for photovoltaics to reach widespread cost parity with conventional electricity sources in the US by 2020, SunPower also outlined its own plans to drive down the cost of the technology.
During the final quarter of 2010, SunPower says that the cost of producing a solar panel reached $1.71 per Watt of peak power output. By the end of this year, it expects to have shaved a further $0.23 off of that total through manufacturing refinements at each of the key stages, from polysilicon production to panel assembly.
The DOE target, revealed by Energy Secretary Steven Chu last week, is to reach $1 per Watt for the total cost of photovoltaic electricity production (including systems installation) by 2020, a goal that will demand roughly a 75% decrease in total production and installation costs. By 2014, SunPower says that it expects to deliver a 40% reduction in costs compared with the 2010 benchmark figure.
The company will be aided in its efforts by the ramp-up of operations at its new solar cell fab in Malaysia, a joint venture with AU Optronics (better known as a liquid-crystal display manufacturer). That fab, which has a capacity of 1400 MW, is expected to produce more than one-third of SunPower’s cells in 2011, according to CEO Tom Werner.
Chinese market emerges
SunPower’s Chinese rival Yingli Green Energy echoed SunPower’s optimism in its own full-year results announcement, saying that "it [estimates] its PV module shipment target to be in the range of 1,700 MW to 1,750 MW for fiscal year 2011, which represents an increase of 60.1% to 64.8% compared to fiscal year 2010.”
"Europe continued to be the region with the largest demand for PV products in 2010, where we generated approximately 80% of our global sales,” said Yingli’s CEO Liansheng Miao, before adding that this percentage would decline to about 60% in 2011, despite the fast-growing Italian market.
One of the key reasons for that diversification is that China itself, which is already home to most of the world’s largest solar cell and module makers, is starting to become an end market as well. “We have been selected to supply approximately 70% of the PV modules for the 272 MW solar projects under the Golden Sun Program sponsored by the Ministry of Finance of China,” said Miao, adding that most of the modules needed for that project would be shipped in the second half of 2011.
• Shares in both SunPower and Yingli were both up more than 5% early trading after the two companies announced their 2011 expectations, along with other PV companies including Q-Cells and SunTech Power Holdings.