360° Coverage : Blinded By The Sun: How Much Do Solar Panels Really Cost?

2 Updates

Blinded By The Sun: How Much Do Solar Panels Really Cost?

May 27 2014, 1:51am CDT | by

Nearly three years ago, a political controversy over the U.S. government’s loan guarantee supporting the once-promising but now bankrupt California solar start-up Solyndra seriously damaged support...

Filed under: news

 
 
 

20 weeks ago

Blinded By The Sun: How Much Do Solar Panels Really Cost?

May 27 2014, 1:51am CDT | by

Nearly three years ago, a political controversy over the U.S. government’s loan guarantee supporting the once-promising but now bankrupt California solar start-up Solyndra seriously damaged support for clean energy in the United States.

At the time, I speculated that financial forces similar to those that sunk Solyndra would sooner or later sink several of China’s major solar equipment manufacturers.

A series of recent defaults at Chinese solar manufacturers suggest I was at least partially right.

In 2013, Suntech Power, a solar manufacturer based in China’s eastern province of Jiangsu, defaulted on $541 million of convertible bonds. In February, Suntech filed for Chapter 15 bankruptcy in Manhattan to seek protection from U.S. creditors.

Meanwhile, LDK Solar, a solar manufacturer based in the southern province of Jiangxi, defaulted on an equally massive bond that matured in February.

Threatened with the prospect of bankruptcy, LDK Solar said it had received $321 million in loans from a consortium of lenders led by the China Development Bank, according to Bloomberg.

The same banks have already lent LDK billions of dollars. In 2011, LDK received $8.9 billion from the China Development Bank, according to Mercom Capital Group, an Austin, TX-based energy consulting firm.

The full scale of financial subsidies the Chinese government has provided domestic solar manufacturers is stunning.

In 2009, while testifying before the U.S. China Economic and Security Review Commission in 2009, Ethan Zindler, the head of Bloomberg’s New Energy Finance, suggested that these subsidies would result in a supply glut in the solar manufacturing sector.

Citing a $5.3 billion loan Yingli Solar had secured in 2010 from the China Development Bank, Zindler said: “That loan alone, and several others like it from the bank, could help double the world’s solar manufacturing supply of solar modules in just the next several years.”

Chinese manufacturers quadrupled production of solar panels between 2009 and 2011 and exported them at prices sufficiently low to expand China’s market share in the solar sector dramatically.

Between 2009 and 2011, the price of modules decreased from $2.79 to $1.59 per watt.

Chinese companies have argued that economies of scale and technical improvements are responsible for these dramatic cost reductions.

Not everyone agrees.

“The explanation for this simultaneous sharp increase in production and sharp price reduction is not entirely the happy economic event of unit cost reduction from economies of scale and improved technical performance with preservation of commercially attractive profit margins,” said the authors of an MIT report about the future of solar energy. “Rather the explanation for this price decline is overexpansion in global, primarily Chinese and Asian, production capacity of cells and modules, combined with a reduction in the demand growth of heavily subsidized PV markets in Europe caused by the financial crisis.”

After a 13-month-long investigation, the U.S. Department of Commerce similarly concluded that China has been illegally pricing solar exports below production costs to undercut foreign competitors and gain market share.

“Pervasive and all-encompassing Chinese subsidies are decimating our industry,” said Ben Santarris, the director of corporate communications at SolarWorld, a solar panel manufacturer based in Hillsboro, OR./>/>

Meanwhile, the US Energy Department’s SunShot Initiative is funding research efforts that aim to cut the all-in cost of solar power to less than $1 per watt by 2020. To do so, solar manufacturers must produce modules that cost less than 50 cents per watt by 2020, which is 75% less than what they cost to make in 2010.

In March, only three years after SunShot began, a Chinese solar company announced that it was producing modules that cost less than 50 cents per watt.

What baffles me more than anything else is how many people seem to believe that technical innovation – rather than Chinese subsidies – is responsible for these stunning cost reductions?

“I believe this is the first time in human history that a module company has recorded cost under 50 cents per watt,” said Shyam Mehta, Senior Solar Analyst at GTM Research.

Really?

 
Update
2

7 weeks ago

Khazanah throws MAS RM6b lifeline

Aug 29 2014 5:01pm CDT | Source: Business Times Singapore

August 30, 2014 1:15 AMKHAZANAH Nasional will inject RM6 billion (SS$2.4 billion) over three years to resuscitate loss-making Malaysia Airlines (MAS) under a recovery plan that includes even an Act of Parliament. Other key moves are migrating its operations, assets and liabilities to a new company (NewCo) and slash ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 
Update
1

7 weeks ago

MAS posts loss of RM307m for Q2

Aug 28 2014 5:00pm CDT | Source: Business Times Singapore

August 29, 2014 1:13 AMMALAYSIA Airlines (MAS) registered a loss of RM307 million (S$122 million) for the second quarter to end-June, but warned of worse to come in the second half when the "full financial impact of the double tragedies of MH370 and MH17" hits home ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

WHO declares Nigeria officially Ebola-free (Roundup)
Abuja/Dar-es-Salam/Tokyo, Oct 20 (IANS) The World Health Organisation (WHO) Monday officially declared Nigeria Ebola-free , after no new cases were confirmed in the past 42 days, even as the International Monetary Fund (IMF) appealed to the donor community to provide grants to countries affected by the deadly virus.
 
 
IMF appeals for help to Ebola-hit countries
Dar-es-Salam, Oct 20 (IANS) The International Monetary Fund (IMF) Monday appealed to the donor community to provide grants to countries affected by the Ebola outbreak to avoid a decline in their economies.
 
 
Japanese firm to produce more drug for Ebola
Tokyo, Oct 20 (IANS) Japan's Fujifilm Holdings Corporation announced Monday that it will start production of the anti-influenza drug Avigan in preparation for a larger number of patients infected with the Ebola virus.
 
 
Algeria denies Ebola detection reports
Algiers, Oct 20 (IANS) Algeria Monday denied reports of detection of Ebola virus cases in its territory, media reported.
 
 
 

Latest from the Network

1,074 new dengue cases in Chinese province
Beijing, Oct 18 (IANS) China's Guangdong province has reported 1,047 new cases of dengue fever, health authorities said Saturday. Six people have already died in Guangdong -- five in Guangzhou and one in adjacent...
Read more on Business Balla
 
Blake Lively 'always' wanted to be mum
Blake Lively has ''always'' wanted to be a mother. The 27-year-old actress is expecting her first child with husband Ryan Reynolds and she admits she's been dreaming of this moment since she was a youngster. Speaking...
Read more on Celebrity Balla
 
Kris Jenner 'torn apart' by Bruce's new relationship
Kris Jenner feels ''torn apart and angry'' that Bruce Jenner is dating her former assistant. The 58-year-old matriarch split from the 64-year-old Olympic gold medalist last October following 22-years of marriage but is...
Read more on Celebrity Balla
 
Cheryl Fernandez-Versini won't move to France
Cheryl Fernandez-Versini doesn't want to move to her husband's home country of France. The 'X Factor' judge, 31, who comes from Newcastle, is adamant she won't be relocating any time soon to suit her new spouse Jean-...
Read more on Celebrity Balla
 
Lance Bass sets wedding date
Lance Bass has set a date for his wedding. The former *NSYNC singer and his partner Michael Turchin, who have been dating for two-and-a-half years, are to tie the knot on December 20, 2014, a representative for the...
Read more on Celebrity Balla
 
Nepal avalanche toll reaches 39
Kathmandu, Oct 18 (IANS) At least 39 climbers died while hiking on a key Nepali route after it was hit by a major snowstorm and avalanches earlier this week, BBC reported Saturday citing officials. Over 350 stranded...
Read more on Politics Balla
 
Jake Gyllenhaal says society is complicit in 'nightcrawling'
Jake Gyllenhaal says almost everybody in society ought to relate to his new movie 'Nightcrawlers'. The eagerly-awaited film concerns those people who monitor police scanners and then race to crime scenes to film eye-...
Read more on Movie Balla
 
India eves look for first win in AFC U-16 qualifiers
Dhaka, Oct 18 (IANS) India will hope to register their first win of the 2015 Asian Football Confederation (AFC) Under-16 Women's Championship qualifiers when they take on hosts Bangladesh in a crucial encounter at the...
Read more on Sport Balla
 
Moyes mulling return to management
London, Oct 18 (IANS) Former Manchester United manager David Moyes said that he is ready to revive his managerial career six months after being sacked by the 'Red Devils'. "I am ready to return. I have enjoyed the...
Read more on Sport Balla
 
Ebola fears loom over Ghana hosting AFCON
Accra (Ghana), Oct 18 (IANS) The Ghana Medical Association (GMA) cautioned the government Saturday against hosting the 2015 African Cup of Nations (AFCON), despite a request by the Confederation of African Football (...
Read more on Sport Balla