A poll of 100 solar professionals concludes the U.S. solar industry will experience strong growth in 2010 and 2011, but other studies warn an increasingly saturated market will cause problems for the industry after that.
The "2009 U.S. Solar Industry Monitor," conducted by management consulting firm Droege & Co., finds that 93% of solar professionals expect strong growth for their U.S. businesses in 2010 and 95% expect the same for 2011.
After retracting by some 20% in 2009, respondents expect over 25% growth in 2010 (37%) and 2011 (55%). 65% say the recession hasn’t crushed the U.S. solar industry. The main obstacles to growth, according to the survey, are lack of financing (82%), little support from utilities (63%), lack of customer knowledge (61%) and insufficient incentives (59%).
They see more favorable legislation and increased marketing efforts as the keys to expansion of their businesses. A full 83% say they plan to step up sales and marketing communications over the coming year.
"The U.S. solar industry is positioning itself for a sales upswing in 2010 that could pave the way for aggressive expansion in the years beyond," says Sebastian Goeres, a renewable energy specialist with Droege. "Competition is fierce, and players compete mainly via cost. We see the need for leading companies to improve their operational costs and to put more emphasis on their strategic plans."
In anticipation of strong demand and harsh competition in 2010 and 2011, 60% of respondents say they will boost their U.S. supply. About half of those polled plan to increase production, while 39% plan to expanding market share through joint ventures, mergers or acquisitions.
They also plan to increase marketing communications through traditional, digital and social media techniques.
Longer Term Growth Less Certain
Another report released by PHOTON Consulting, Solar Annual 2009: Total Eclipse, agrees the industry is set to resume its growth trajectory in 2010-2011, but warns about longer term challenges that could lead to an "ecliple" because of saturation in key markets.
The risk of an ‘eclipse’ means industry players must pursue strategies that go beyond ‘volume-up/cost-down,’ said the report.
And a report from Lux Research concludes that even though oversupply has forced module makers to drastically reduce prices over the past year, new players are still entering the already overcrowded industry. There’s a looming shakeout and only a select few will emerge as dominant players, they say.
The report, "Sorting Solar Module Makers on the Lux Innovation Grid," quantitatively compares 127 module makers according to their technical value, business execution and maturity.
"Unlike the battery industry, where end applications are very diverse, solar is populated by a lot of module makers all targeting the same few applications: utility, commercial and residential installations," said analyst Johanna Schmidtke.
Lux finds that improved polysilicon pricing should help cement crystalline silicon’s advantage in most installation markets through next year. Players such as Sanyo Electric (SANYY.PK), SunPower (SPWRA) and Sharp (SHCAY.PK) are best positioned to pursue tailored, high-efficiency products for the residential market.
Thin-film PV will gain market share in commercial and utility markets and, aside from First Solar (FSLR), the market is wide open. Many companies are at risk and must grow capacity, deliver performance and reliability, and prove cost competitive over crystalline. First Solar will compete against crystalline for utility-scale installations in the U.S. and China.
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