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GSR 2015

62 02 MARKET AND INDUSTRY TRENDS ■■ SOLAR PV INDUSTRY The solar PV industry recovery, which began in 2013, continued in 2014 thanks to strong global demand.88 Most top tier companies were back in the black (or at least had reduced losses) by year’s end.89 It was a challenging year in Europe, however, where shrinking markets left many installers, distributors, and others struggling to stay afloat, and companies diversified risk by focusing on markets elsewhere.90 Low module prices continued to challenge many thin film companies and the concentrating solar industries, which have struggled to compete.91 International trade disputes also continued.92 (pSee Policy Landscape section.) Average module prices fell during 2014, with multicrystalline silicon module spot prices down about 14% year-over-year to USD 0.6/Watt.93 The drop in spot price was driven by incremental module production cost reduction, lower regional price levels, and weaker-than-expected demand (especially in China).94 The industry continued to focus on reducing soft costs (non- hardware). Total installed costs fell worldwide in 2014, with significant differences in soft costs depending on project location and scale—soft costs are higher in the United States and Japan than in Australia or Germany, for example.95 As costs fall, solar PV-generated electricity has become cost- competitive with fossil fuels without subsidies in an increasing number of countries.96 The year 2014 saw extremely low bids for solar PV in several countries including Brazil, India, and the United Arab Emirates—where low bids (the top six were below USD 0.06/kWh) encouraged the government utility to double its contracted capacity.97 Production of crystalline silicon cells and modules rose in 2014. Estimates of cell and module production, as well as of production capacity, vary widely; increasing outsourcing and rebranding render the counting of production and shipments more complex every year.98 Preliminary estimates of production capacity in 2014 ranged from around 45 GW to 60 GW for cells, and from about 50 GW to more than 70 GW for modules.99 Thin film production also increased, by an estimated 25%, with its share of total global PV production remaining at about 10%.100 Over the past decade, module production has shifted from the United States, to Japan, to Europe, and back to Asia, with China dominating shipments since 2009.101 By 2014, Asia accounted for 87% of global production (up from 85% in 2013), with China producing 64% of the world total (same in 2013).102 Europe’s share continued to fall, to about 8% in 2014 (10% in 2013), and the US share held at about 2%.103 Among the leading module manufacturers in 2014 were several Chinese companies including Trina, Yingli, Canadian Solar, and Jinko Solar; other top manufacturers included Hanwha Solar One (South Korea) and First Solar (United States).104 Sharp Solar and Kyocera (both Japan) bought and rebranded a large number of Chinese modules, and were among the top sellers for the year.105 To meet rising demand in an increasing number of markets, numerous Asian, US, and some European-based manufacturers restored idled capacity, opened new cell and module production facilities, or announced plans to expand capacity around the world.106 A major driver for Chinese panel makers to build factoriesinMalaysiaandelsewhereoverseashasbeenavoidance of anti-dumping tariffs imposed by the United States on goods produced in China.107 US-based manufacturers have responded to competition—especially from China—by increasing volume at home and investing in automation and efficiency.108 At the same time, several manufacturers closed facilities in Europe to concentrate on other markets.109 For example, Solaria Energia (Spain) shuttered its manufacturing plant in Puertollano to focus on new markets in Latin America and the Asia-Pacific region.110 Consolidation among manufacturers continued into 2014, but at a slower pace.111 Despite being the largest market, China’s industry saw some of the greatest challenges as the government took steps to avoid worsening of overcapacity and to drive consolidation of manufacturers.112 Chinese cell maker LDK Solar became the fourth major Chinese solar company in just over a year to seek bankruptcy and restructure its debt.113 The year also saw several mergers and acquisitions. Some manufacturers expanded into markets downstream or in new regions, and some took over their competition, while non-solar companies took steps to enter the industry.114 For example, developer, financier, and installer SolarCity purchased module manufacturer Silevo (both United States) and began moving into energy efficiency and storage; Sunrun (developer and financier) made several acquisitions including distributor AEE Solar and racking hardware manufacturer SnapNrack (all United States); Chinese building materials and glass company CNBM acquired German CIGS manufacturer Avancis; and, in early 2015, Canadian Solar (China) purchased US-based Recurrent Energy from Sharp (Japan) to expand its US project pipeline, while the largest US utility, Duke, acquired a majority stake in US developer REC Solar.115 Many companies furthered strategic partnerships to advance technologies and expand their reach. For example, SunEdison (United States) announced a joint venture agreement with JIC Capital (China) to facilitate financing to develop, construct, and own up to 1 GW of projects in China; Hanergy and Suntech (both China) expanded into Switzerland and the Benelux countries, respectively, with new partnerships; LG Electronics (South Korea) teamed up with Borrego Solar (United States) to supply modules to the US commercial market; and Trina, Yingli, and Canadian Solar announced initiatives to partner with financial backers to develop new large-scale plants.116 Several partnerships focused on energy storage options for commercial and residential markets in Japan, the United States, some European countries, and elsewhere: for example, Kyocera and Sharp began marketing innovative storage options with solar PV; and Siemens (Germany) announced plans to offer its VersiCharge home-charging system to Sunrun customers who own electric vehicles.117 New business models and innovative financing options continued to emerge, and 2014 saw the launch of several solar PV yield companies (or yieldcosi ), which facilitate access to relatively low-cost capital for project development, a major driver for reducing generation costs.118 New online investment platforms are enabling people around the world to invest in solar PV projects.119 In the United States, an increasing number of firms—including solar developers and installers, investment companies, and major banks—have entered the solar financing i - See Glossary.

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