Analyst sees second gold rush in solar

Canada and a number of European countries including the Czech Republic, Germany, Italy, France and the U.K. are gearing up subsidies for photovoltaics. The new efforts will surpass subsidies offered by Spain and Germany that generated a gold rush from 2007-2010, said Vishal Shah and analyst with Barclays Capital Clean Technology in a report released Friday (Sept. 24).

A new round of government subsidies for solar panels could drive
second gold rush in the solar market, according to a financial analyst.

"On an absolute basis, subsidies in many markets are expected to be higher in 2011," Shah wrote. "We expect demand to exceed low-cost supply during [this] second growth phase," he added

Specifically, subsidies will range from $7.85 per Watt in the Czech Republic to $10.28/Watt in Canada. That far exceeds the subsidies of $7.36/W in Spain and $4.56 in Germany.

Barclays believes polysilicon makers will reap the highest gross margins in the solar industry at about 20 percent. Makers of solar wafers and cells will follow at about 15 percent with module makers and installers trailing at about 10 percent gross margins.

Most installers in the U.S. market are unable to get sufficient panels due to current strong demand in Europe, said Shah. Several European installers are looking to enter the U.S. market in 2011 and already have projects representing sales of 40-50MW in the pipeline, he added.