Global solar panel glut

[rollover]

Quote

 

Solar manufacturers led by China’s Trina Solar Ltd. are probably selling at a loss after prices fell to a record low this week. The global spot market price for solar panels fell 2.4 percent to an average of 36 cents a watt on Dec. 28, according to PVinsights. That’s the bottom end of the cost range for most producers in the third quarter, according to Jeffrey Osborne, an analyst at Cowen & Co. Suppliers are expanding capacity this year while demand is expected to slow in 2017, helping to push prices down.

Certainly it would be a challenge for anyone to make money at that price. The current price is also lower than cost estimates from Trina. The biggest supplier of 2015 expected to reduce costs to about 40 cents a watt by the end of the year, from 45 cents in the second quarter. Some companies’ cost structures remain competitive, even with prices this low.

Canadian Solar Inc., the second-biggest supplier, reported costs of 37 cents in the third quarter, down from 39 cents in the second quarter. The company has said its costs are among the lowest in the industry, and it expects to reach 29 cents a watt by the fourth quarter of 2017. Many of its competitors expect costs in the low 30s by then, Osborne said. Bloomberg

 

I expect some bankruptcies in the sector in the next year or two.

[The Knimbies who say No]

Can anyone find panels for sale anywhere close to this? I got to 75 pence/ watt as about the cheapest. Someone is making a chunk....

 

Cheap solar is a very good thing indeed.

 

Edit here's circa 40 pence/watt:

 

http://www.ebay.co.uk/itm/REC-260W-SOLAR-PANEL-260W-SOLAR-PANELS-/152357139352?hash=item2379317398:g:SbcAAOSwOtdYUn0m

 

 

 

Edited December 30, 2016 by The Knimbies who say No

[reddog]

My advice is load up on the cheap solar panels while for can.

 

On a serious note, how did the market get to be like this?  "Funny money" and a Chinese planned economy creating over capacity?

[Blod]

2 hours ago, reddog said:

On a serious note, how did the market get to be like this?  "Funny money" and a Chinese planned economy creating over capacity?

Is there cheaper tech about to be produced hence leading to a a drop in demand? Maybe not but even a rumour could cause a small drop.

[StainlessSteelCat]

I can't see demand decreasing as the price decreases personally. I reckon solar will be the energy equivalent of mobile in Africa once it gets cheap enough i.e. they won't bother with a traditional infrastructure approach.  We're definitely on a path where it'll be feasible to install in the UK - even without a feed-in tariff/optimal positioning - and that's great news. Add in growing numbers of electric cars - and the potential to use them as storage for excess capacity - and I think we'll be looking at more and more people saying sayonara to the grid in the 2020s.  One day, perhaps it'll seem as bonkers to rely on a grid to supply your energy (and pay a standing charge for it) as the BBC's licence fee currently does to some of us. 

Edited December 31, 2016 by StainlessSteelCat

[mattyboy1973]

8 hours ago, reddog said:

On a serious note, how did the market get to be like this?  "Funny money" and a Chinese planned economy creating over capacity?

I'm no expert, but my understanding is that this is mostly just a normal evolution, and if anyone is selling "below cost" (due to funny money, or whatever), then it is not much below cost - i.e. we can expect these prices to continue to get cheaper. Solar panels are getting more efficient and use fairly cheap, abundant materials to produce and they are moving to a price-point now where it will make sense to install them just about everywhere. All the talk is about solar becoming genuinely cheaper (without subsidies) than fossil fuels much sooner than expected, which is great news as this is really the only way we are going to make the transition. If we can sort similarly cheap energy storage out then things will really get interesting.

[winkie]

Seeing more fields of them about, driving other day went on for miles....Also people using them to help heat water when the sun shines not connected to grid.

 

[Funn3r]

Should be made illegal. People are stealing the sunlight which actually belongs to the government and the electricity companies. 

[Saving For a Space Ship]

29 minutes ago, Funn3r said:

Should be made illegal. People are stealing the sunlight which actually belongs to the government and the electricity companies. 

No doubt they will be funding the Soluddites / Solarluddites Lobby .

The Koch Brothers' Dirty War on Solar Power

http://www.rollingstone.com/politics/news/the-koch-brothers-dirty-war-on-solar-power-20160211

 

[durhamborn]

If the press hates the industry and everyone is saying its a horrible investment its probably a great time to buy the ETFs TAN or KWT .Add in URA for the uranium miners and you have clean energy pretty much covered (if you class nuclear as clean).Once the batteries for storage become much better as mattyboy1973 says solar might really explode.Centrica have been selling upstream assets and buying companies that help move all this clean energy around the grid from multiple sources and also huge battery storage,i think they are building one in Cumbria.

 

[ChumpusRex]

10 hours ago, reddog said:

On a serious note, how did the market get to be like this?  "Funny money" and a Chinese planned economy creating over capacity?

I think it has just been a bubble and natural overinvestment - in much the same way as we saw with shale gas. There has been 30 years of investment in 5 years, the capacity investment is now becoming available, and demand is not yet there.

The advances in PV technology have been staggering. You can buy off-the-shelf panels today which are 2x as efficient as panels you could buy 15 years ago. I think we'll seem some slow down in the acceleration of performance of new panels, not least because the performance is now approaching the theoretical limit for the technology. (Theoretical limit is about 30% for silicon monojunction cells - and a practical limit would be around 28% once you've added reflections/losses from the cover glass, internal wiring losses, etc.  Yet you can buy modules today which can achieve 22.8%, and new production runs have achieved 24.5%). Most of the investment has gone into silicon technology, but there are other technologies which could have better eventual performance. However, I suspect silicon is going to be the big one for a while.

If I'm hopeful, I would expect the oversupply to induce further cost-cutting measures in the suppliers (rather than result in mass bankruptcy). People said the same about shale gas/oil and while there were a few bankruptcies, the sector instead responded by massive cost cutting and seems to have stabilised itself, at least in the US.

 

Edited December 31, 2016 by ChumpusRex

[mattyboy1973]

10 minutes ago, ChumpusRex said:

Most of the investment has gone into silicon technology, but there are other technologies which could have better eventual performance. However, I suspect silicon is going to be the big one for a while.

I think cost is more important than outright performance. There's no real shortage of space for these things, so for now something at half the price with 2/3 the performance is likely to be the winner. Most people cover only a fraction of their roofs, although the new "solar roof tiles" from Elon Musk do look rather cool. Imagine new builds coming with something like that as standard, with a couple of days energy storage in a battery pack? That could be a reality within a decade or two. Maybe a small four-stroke generator for absolute emergencies, and you could easily imagine going off-grid completely - although the idea of a de-centralised "grid" with lots of small power-storage centres is probably more realistic and equally beneficial.

[rollover]

10 hours ago, reddog said:

My advice is load up on the cheap solar panels while for can.

 

On a serious note, how did the market get to be like this?  "Funny money" and a Chinese planned economy creating over capacity?

"load up on the cheap solar panels while for can" - I think that's what people stop doing.

To your serious point: Tesla’s new solar roof is big factor here

Quote

 

Musk Says Tesla’s Solar Shingles Will Cost Less Than a Dumb Roof

Tesla’s new solar roof product, he proclaimed, will actually cost less to manufacture and install than a traditional roof—even before savings from the power bill. “Electricity,” Musk said, “is just a bonus.”

 

[Saving For a Space Ship]

1 hour ago, rollover said:

"load up on the cheap solar panels while for can" - I think that's what people stop doing.

To your serious point: Tesla’s new solar roof is big factor here

 

 

All these tiles are nice & retro / in keeping with existing streets etc . Is there a reason for a small solar tile ?  could it not be a sips panel, giving passive haus insulation,  shaped to look like individual tiles if you like / need that look. 

 

Does anyone  make 'sips solar panels' ? it seems like a logical step imo . 

Edited December 31, 2016 by Saving For a Space Ship

[Peter Hun]

12 hours ago, The Knimbies who say No said:

Can anyone find panels for sale anywhere close to this? I got to 75 pence/ watt as about the cheapest. Someone is making a chunk....

 

Cheap solar is a very good thing indeed.

http://www.buypvdirect.co.uk/PV_Panels

for a start.

Google 'Solar by the Pallet' seems to pickup the cheapest deals.

 

Quote

All the talk is about solar becoming genuinely cheaper (without subsidies) than fossil fuels much sooner than expected,

Already is cheaper than coal in some locations. The cost of inverters is becoming an issue, they need to be much cheaper. DC domestic appliances could be cheaper, too.

 

Edited December 31, 2016 by Peter Hun

[longtomsilver]

1 hour ago, rollover said:

"load up on the cheap solar panels while for can" - I think that's what people stop doing.

To your serious point: Tesla’s new solar roof is big factor here

 

 

Has anyone on here considered investing in Tesla stocks? The next Apple? I don't know that's why I'm asking, if the consensus is yes I'll have a dabble with 500-750 shares and maybe VW too (carrying out emission scandal due diligence first though). 

The market for both the roof/batter and cars are huge. My wife's boss has just ordered a Tesla for his next company car... he basically wrote off the £30k remaining on an A8 (expensed of course) due to the pending tax hikes on ICEs.

Edited December 31, 2016 by longtomsilver

[Peter Hun]

Tesla are a bit of a gamble. The car manufacturers are going full into elctric themselves and they ahve being been doing this for a centuary - mass producing cars.

Tesla are a Californian nerds (with deep pockets) car . They might succeed, but they will be one manufacturer amoung many.

I'd buy a Mercedes.

[Ballyk]

Tesla stock appears very expensive compared to say Daimler (Mercedes).

However, Tesla has some big advantages - 

1.  It can produce batteries at much lower costs than competitors.  It is building its big battery 'gigafactory' which will massively reduce costs.  Other carmakers are dependant on battery suppliers with currently higher costs;

2.  It is far ahead of the opposition in terms of understanding battery / electric motor technology.  Its Model S was launched in 2012 and nobody has come up with a car that even gets close to its range or performance.  Meanwhile Tesla just keeps getting better;

3.  Its cars are very much 'computerised' and most of the 'fleet' are feeding back to Tesla massive data on the miles they have driven.  No other carmaker has this connection with their fleet, and it gives Tesla a big advantage when it comes to developing self driving technology.  Google and others may be attempting to create self driving cars, but they do not have 100,000 cars feeding back data to them;

4.  Tesla owns all its dealers.  Therefore 100% of the profit of their cars is captured by the company (including sales of pre-owned cars);

5.  They might not enjoy an 'economies of scale' advantage in mainstream components, but they sell more automotive 'battery power' than any other manufacturer.  Nissan sells more Leafs, but the value of Tesla's sales of electric cars dwarfs Nissan due to their higher prices and the Tesla batteries are much larger.  BMW / Mercedes, etc really need to drive volumes of their electric cars to achieve battery / electric motor economies but they are very much a niche for them;

6.  Tesla will start producing their 'mass market' Model 3 late next year which will bring their volumes up to 500,000 in a couple of years, about 25% of what BMW / Mercedes do in total currently.  2016 Tesla sales will be about 80,000.  They will keep growing, and largely without any paid advertising.

So I would say Tesla has a bright future.  I have a fair number of Tesla shares, for full disclosure.  The argument against is of course that they face huge competition from the currently highly profitable and cash generating likes of BMW and Mercedes.  This is true, but in my view the incumbents will see a lot of red ink if they start writing off their investment in engine factories, etc, and will be left behind by not having a full grip on the electric technology, or a real commitment to it.

 

[Ballyk]

Re solar, the very low prices for solar systems will cause a growth in demand, but with a lagged effect.  The market for solar systems, particularly the large 'utility scale' systems will grow, but these large projects take a long time to plan, at least 12 months, and that won't be long enough for some companies.  

I would expect to see explosive growth in the next few years due to the lower prices, and falling prices relative to other forms of generation.  But that's not to say there won't be casualties among solar companies, as the demand may not come fast enough for some to stay in business.  The solar panel business has parallels with the 'famine or feast' nature of the semiconductor business, which has seen massive growth in demand followed by massive oversupply of capacity, price collapses and business failures.  But the strong will survive, which will be the ones with best technology, lowest costs, strongest balance sheets or most supportive governments behind them (or some combination of all these factors).  

I have recently bought First Solar shares, FSLR on the basis of their good technology, balance sheet, reputation and by recent standards very low share price.  They recently took the difficult decision to skip the 5th generation of their panels, which they were due to start producing in 2017, and bring forward their 6th generation to 2018.  So they should emerge from the current slump stronger than most.

[dgul]

1 hour ago, Ballyk said:

Tesla stock appears very expensive compared to say Daimler (Mercedes).

However, Tesla has some big advantages - 

1.  It can produce batteries at much lower costs than competitors.  It is building its big battery 'gigafactory' which will massively reduce costs.  Other carmakers are dependant on battery suppliers with currently higher costs;

2.  It is far ahead of the opposition in terms of understanding battery / electric motor technology.  Its Model S was launched in 2012 and nobody has come up with a car that even gets close to its range or performance.  Meanwhile Tesla just keeps getting better;

3.  Its cars are very much 'computerised' and most of the 'fleet' are feeding back to Tesla massive data on the miles they have driven.  No other carmaker has this connection with their fleet, and it gives Tesla a big advantage when it comes to developing self driving technology.  Google and others may be attempting to create self driving cars, but they do not have 100,000 cars feeding back data to them;

4.  Tesla owns all its dealers.  Therefore 100% of the profit of their cars is captured by the company (including sales of pre-owned cars);

5.  They might not enjoy an 'economies of scale' advantage in mainstream components, but they sell more automotive 'battery power' than any other manufacturer.  Nissan sells more Leafs, but the value of Tesla's sales of electric cars dwarfs Nissan due to their higher prices and the Tesla batteries are much larger.  BMW / Mercedes, etc really need to drive volumes of their electric cars to achieve battery / electric motor economies but they are very much a niche for them;

6.  Tesla will start producing their 'mass market' Model 3 late next year which will bring their volumes up to 500,000 in a couple of years, about 25% of what BMW / Mercedes do in total currently.  2016 Tesla sales will be about 80,000.  They will keep growing, and largely without any paid advertising.

So I would say Tesla has a bright future.  I have a fair number of Tesla shares, for full disclosure.  The argument against is of course that they face huge competition from the currently highly profitable and cash generating likes of BMW and Mercedes.  This is true, but in my view the incumbents will see a lot of red ink if they start writing off their investment in engine factories, etc, and will be left behind by not having a full grip on the electric technology, or a real commitment to it.

 

They are completely dependent on government largess.  Buying shares in them is a bet on this situation continuing.  

[Funn3r]

I know very little about either solar or car technology but just throwing in my 2p. Feel free to disregard if you think I am talking bolleaux (it is sadly not unknown.) 

I met a very interesting guy yesterday in a jacuzzi, he looked around 60+ ish and although German had lived in UK for most of his life. An automotive design engineer he said he had worked a long time for BMW but also done work for other manufacturers. Quite disparaging about the German character and outlook saying that the stereotypes were true they were efficient but fatally lacked intuition and were too conformist, leading to all the manufacturers worldwide being design-led by British (I was surprised) and Italians. I asked for predictions for the motor industry (expecting him to bang on about driverless cars etc.) but no he said that Honda had in the past ruined the prospects and reputation of the 2-stroke engine but 2-stroke/electric hybrid was 100% the way of the future. Also that diesel had its place (I think he meant long distance travel) but was finished as a technology in cities,  I didn't understand some of his reasoning about engine temperature but I do remember he said mainly the unsolveable problem of the nanoparticulates.

Bloke definitely seemed to know what he was talking about not a BSer. 

[Ballyk]

1 hour ago, dgul said:

They are completely dependent on government largess.  Buying shares in them is a bet on this situation continuing.  

In some countries there are significant incentives for EVs, eg Norway.  But these incentives are only really necessary at the start of the switch to EVs as the components are all new and not mass produced.  As the industry scales from production in the 10,000s to 10,000,000s there is no need for incentives, as EVs should be less expensive to build.  Batteries have never been produced at the vast scale necessary for signficant EV adoption, so they are more expensive, but the price is coming down significantly.  And electric motors are a lot less expensive to build than ICEs.

So the bet on Tesla is less a bet on government subsidy, and more on it staying well ahead of the chasing automotive pack.

[Peter Hun]

10 minutes ago, Ballyk said:

So the bet on Tesla is less a bet on government subsidy, and more on it staying well ahead of the chasing automotive pack.

Good luck with that. Tesla are one manufacturer amoung many and the share price will reflect the fanbase not reality.

 

1 hour ago, Funn3r said:

but no he said that Honda had in the past ruined the prospects and reputation of the 2-stroke engine but 2-stroke/electric hybrid was 100% the way of the future. 

2 strokes are indeed twice as efficient as four strokes and the optimum solution was recently analysed to be a hybrid.

So I think your German friend was on to something.

Edited December 31, 2016 by Peter Hun

[mattyboy1973]

1 hour ago, Peter Hun said:

2 strokes are indeed twice as efficient as four strokes and the optimum solution was recently analysed to be a hybrid.

So I think your German friend was on to something.

I must admit I am puzzled as to why the plug in range-extender concept never really caught on - it seems to make an awful lot of sense, removing range anxiety whilst most of the use probably would just be on battery (I have no doubt a lot of people - me included - dismiss the idea of a full EV, even with 100+ miles of range, on the basis that they might need to go further - but in fact do so in a day very infrequently). Using engines as generators instead of the main power plant gives a lot of advantages - e.g. you don't need a complicated drive train and you can always run at the optimum rev range which gives much better efficiency. There was a great looking jaguar concept car that used a small gas turbine (the size of a desk-mounted pencil sharpener) as a range extender - I was really hoping that would catch on! (I love the sound of jet engines). Actually, small jet engines potentially have even more advantages than ICEs, being much, much lighter for the same HP.

[Peter Hun]

The BMW i3 has a range extender option for £3000. Its the best selling EV in Europe.

https://en.wikipedia.org/wiki/BMW_i3

 

http://www.bmwblog.com/2016/12/31/bmw-i3-best-selling-european-ev-november/

3 BMW EV's outsell the Tesla in Europe

https://cleantechnica.com/2016/12/30/bmw-i3-1-europe-november-mitsubishi-outlander-phev-1-jan-nov-2016/

Edited December 31, 2016 by Peter Hun