Friday, November 03, 2006

Recent Solar Electric Developments

Suggesting that solar electric modules have a huge cost reduction potential

1) SunPower - this firm is the cutting edge on crystalline modules. A few reasons include:

2) Applied Materials (AMAT) enters the solar cell manufacturing business. They make the machines that make large flat screen TV's - where evey pixel has to work. AMAT is a huge company with a capitalization of over $25 billion. I believe that they will be in the thick of the world wide revolution of the solar cell manufacturing process. That revolution will dramatically reduce the cost per watt of cells. AMAT's enterance into the marker helps assure that we see radical new cell designs sooner rather than later.

3) Sanyo Bifacial solar module. As far as I know they are the first to combine crystalline and thinfilm photovoltaic materials in one cell. This trend, of layering different photovoltaic materials that respond to different wavelenghts of radiation (or materials with different bandgaps) is the path to higer efficiency cells.

The Sanyo bifacial panels produce power from both sides and thus have two "front" sides. As a result its efficiency is dependent on the incident light on both sides.

Summary: I am convinced that we will see solar prices per watt fall more rapidly than we have historically (Historically, the market saw about a 20% cost reduction will every doubling of cell production). With these new developments (and the cost of other energy resources increase) we will see solar electric systems take over the world's rooftops.

Forecasts: Solar will be cost effective in much of the world in the next seven years. Both demand and production will increase very rapidly. When demand outpaces production by too much, prices will increase, technical innovation will be pushed even harder, and the market will continue to grow. This is a boom market and will be so for decades.

The Big Question: Will solar electric beat out nuclear? The answer will depend on developments in electricity storage.

Stock pick: At the moment my favorite is SunPower - they seem to be constantly innovating - and now define cutting edge. But can they keep it up? What has Evergreen, UniSolar or the others really done in the last year or so. The companies that constantly innovate will win this race.

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