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WASHINGTON, DC, US, September 20, 2006
(Refocus Weekly)
The U.S. solar industry shipped 226,916 kW of PV
cells and modules last year, an increase of 25% over 2004.
Energy prices in the United States have been increasing since the
start of last year, partly due to hurricanes and demand pressure on
imported oil supplies, and “this has increased interest in alternate
energy sources, which include renewable energy sources such as
solar,” says the Energy Information Administration in its latest
report on solar PV manufacturing activities. The U.S. manufacture of
photovoltaic cells and modules continued to grow at a strong pace
last year “despite the fact that prices for solar panels and PV
cells and modules rose due to material cost increases.”
“The solar industry has been able to absorb most of the rising
material costs because it has become more flexible in its production
methods and supply arrangements over the past years,” it explains.
“It has recovered from the nationwide economic downturn in 2003,
showing significant growth in 2004 and 2005.”
Domestic shipment of PV cells and modules reached a record high of
134,465 peak kilowatts in 2005, a 72% increase from the previous
record of 78,346 kW in 2004 and an increase of 176% from 2003.
Rising electricity prices during the past two years have increased
demand for PV, which spawned new PV technology and business
opportunities during 2005.
Total shipment of cells and modules rose to 226,916 kW last year, a
25% increase over 2004. Module shipments increased 43% to 204,996
kW, while shipment of PV cells decreased to 21,920 kW from 37,842 kW
in 2004.
“This suggests a potential shift in manufacturer focus of offering
unique PV modules to meet the strong demand of their customers,
likely caused, in part, by higher energy prices,” the report
explains. “Among the indicators of the shift is the recent increase
in module supply agreements by the PV manufacturers. This increased
demand comes at a time of an industry-wide shortage of silicon, the
principal feedstock of PV cells.”
The price of silicon wafers has doubled in each of the past two 2
years, and tight silicon supply has created back orders of several
months. “Demand is far greater than supply and PV manufacturers have
simply not been able to keep up,” the report notes. “Because of
this, manufacturing costs have risen sharply, and manufacturers such
as Evergreen Solar and SunPower have changed their business
strategies to maintain profits and continue to finance their plans
to expand their production and strengthen their distribution
capabilities.”
Before 2005, the number of companies shipping PV had remained
steady, averaging 20 over the past two decades but, last year, the
number of active companies surged to 29, compared to 19 in 2004.
Imports jumped to 90,981 kW in 2005 from 47,703 kW in 2004, an
increase of 91%, and the main contributors to this increase were
U.S. subsidiaries of Japanese companies who are importing cells.
By contrast, exports dropped last year to 92,451 kW from 102,770 kW
in 2004, and the decrease was influenced by the decline of shipments
from a single company due to silicon supply disruptions. Shipments
to wholesale distributors, the largest business category, increased
22% to 130,086 kW last year while shipments to the second-largest
category, installers, surged 94% to 67,437 kW in 2005.
Although the market share of crystalline silicon cells and modules
declined to 76% from 88% in 2004, it is still the dominant type of
solar cell and, within that category, single-crystal shipments fell
to 71,901 kW, 32% of total shipments last year, compared to 94,899
kW in 2004. Shipments of cast and ribbon silicon rose to 101,065 kW,
45% of total shipments, compared to 64,239 kW in 2004, and “cast and
ribbon is now the predominant PV technology,” with increased
shipments largely attributable to three of the largest PV
manufacturers.
“The theoretical potential of thin-film solar technology has been
encouraging PV industry research in this area for many years,” and
companies promoting thin-film solar are rapidly attracting venture
capital, it notes. Fueled by rapid growth in the market and the
continuing tight supply of silicon (thin film technology uses less
silicon per unit of electrical output than crystalline silicon),
shipments of the small thin-film market doubled to 53,826 kW last
year compared to 21,978 kW in 2004, and thin-film now accounts for
one-quarter of the PV market.
The total value of PV shipments grew 40% to US$702 million last
year, with an average price for modules reaching $3.19 per peak
watt, up 6% over the $2.99 in 2004. For PV cells, the average price
rose 13% to $2.17 with increases due primarily to increases in
material costs and the shortage of refined silicon. The commercial
sector remained the largest target for PV shipments at 89,459 kW, up
20%, while the residential sector totaled 75,040 kW, up 39%. Power
generation, including both grid-tied and remote, is the predominant
end use for PV, accounting for 85% of total shipments last year, 31%
higher than 2004.
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