M&A
January 5, 2012
China has announced a new solar subsidy for BIPV systems of 9 Yuan per Watt ($1.4/watt) and CNY 7/watt for PV systems for home.Note China has already become a top 5 market in the world in 2011 after announcing a $1.15/kwh Feed in Tariff for utility scale solar power instalations.This new subsidy by the Chinese ministry of finance should boost the home and commercial segment.Note China had recently raised the target of solar energy to 15 GW by 2015 from 10 GW as solar energy has grown amazingly fast in the recent past.
January 5, 2012
Pakistan is a energy deficit country like most other South Asian countries with inadequate investment in the electricity sector and the distribution infrastructure.The cause of the energy crisis in the country is due to massive corruption and misgovernance , a theme which will be familiar to citizens of India as well.Pakistan has been looking at investments from the Chinese power companies in the hydro and wind sectors to boost electricity generation.However these investments take time and some may never come to fruition.However Pakistanis are now turning towards cheap Chinese solar panels to beat the high electricity tariffs and dependence on expensive diesel generators and UPS systems.
January 4, 2012
Adani Power,which is a leading Indian electricity company and part of the Adani Group is set to invest big money in the solar power in India.The company plans to set up 140 MW of energy capacity according to news reports with an investment of $600 million.Given the current costs of solar equipment and solar panels ,the price tag looks high at almost $3.5 million/MW when the current prices are more like $2 million/MW for large power plants in low cost locations like India.
January 3, 2012
Chinese Solar Panel Producers have become a famous target of an anti dumping petition brought on by Solarworld and other companies.Though US Solar Installers have opposed the move as it will increase the solar panel prices in US,ITC has gone ahead with the investigation.Though the charges of subsidies and efficiency can be debated,the fact remains that US Solar Panel Producers can't compete with Chinese Solar Panles.Massive industrial overcapacity in China has made the prices of products very cheap and made it difficult for Western producers to compete in most areas such as Chemical,Renewable Energy,Textiles etc.The Chinese win because of their low interest rates,cheap labor,free land,massive government support.
January 2, 2012
Note Chinese companies too would have shut down but the state owned Chinese banks are keeping them alive with loans at ridiculous interest rates.LDK which is buying Sunways is almost insolvent as well with its convertibles trading at less than 50c on the dollar in Singapore.It has more than n$3 billion in debt compared to its market cap of around $600 million.It faces massive losses in the coming qtrs and can't serve the interest payments much less expand.The strong support of the Chinese government for its green companies is keeping them alive.Chinese solar panels have become super cheap due to companies selling at below cost and massive scale.Note all the cheap solar panel brands in the world are Chinese with the exception of First Solar and some Asians.
LDK has managed to spend 22 million Euros despite burning hundred of millions of dollars in cash because it has got the Chinese government trillions backing it.So while Western companies burn and crash,the big crony Chinese companies can expand and acquire.
Most of the German solar manufacturing industry is finished and it is unlikely that except a couple of them like SM Solar or Wacker will live to see 2013.Q-Cells too should go bankrupt or get consolidated .Note despite European companies shifting factories to Asia ,they just can't compete.Some of the smaller module makers with 20 MW plants have seen huge losses with the equipment not selling for 10 cents on the dollar
August 16, 2011
Sharp is the largest solar company in the world by revenues and has been so for the last few years despite massively increasing competition from Chinese Solar Panel Producers.While other Japanese conglomerates like Sanyo,Mitsubishi and Kyocera have substantially lost solar panel marketshare ,Sharp has managed to retain its leadership position.Though companies like First Solar and Suntech have shipped more solar modules than Sharp,in terms of total dollar sales Sharp is still on top.Sharp which used to make polycrystalline and monocrystalline silicon solar panels has diversified into producing thin film amorphous silicon solar panels.The company has also entered the solar IPP and solar development business in collaboration with Enel Green Power and by acquiring a US Solar Developer Recurrent Energy.However in core solar panel production,Sharp has much higher costs and has lost money consistently.Sharp sells Solar Systems and Solar Inverters as well as Solar Modules.However the challenges in the solar market are considerable with well funded low cost competitors from China and South Korea.Sharp faces the toughest years of its solar history as it fights to survive in this cut throat Solar Market
July 8, 2011
GE is one of the biggest companies in the world and has one of the biggest Green businesses as well.GE is the most profitable wind turbine manufacturer and is one of the largest renewable energy developers in the globe as well.GE like other electrical and power conglomerates like Siemens has decided to invest billions of dollars into Green Energy.Till recently Solar Energy had gotten scant attention from GE just like Siemens too has not invested a lot.However the 50% CAGR rates of Solar Energy,the fast declining costs have made it imperative for GE to have a presence in this market.GE had bought a thin film solar company Prime Solar a few years ago to acquire the Cadmium Tellerium Technology which First Solar uses in its Solar Panels.
July 6, 2011
Solar Frontier is a Japanese company which was earlier known as Showa Shell Solar .The company joined the rank of major solar companies once it started the new 900MW “Kunitomi” production plant in Miyazaki.Note only is the company started big in production,it is rapidly signing deals around the globe in India,Middle East and America..The Company has recently signed Two Deals with 2 Global Heavyweights GE and IBM.It has signed a distribution deal with GE to sells its Copper Indium Selenide (CIS) Panels in USA while GE would provides the Balance of Systems components like inverters etc.It next signed a deal with IBM to jointly develop Copper Zinc Tin Sulfure Selenium (CZTS) Thin Film Technology.Note IBM is one of the biggest Technology Innovators and Solar Frontier has a long Thin Film History.
July 6, 2011
Solar Thin Film Technology has been growing rapidly despite falling costs of the mainstream Photovoltaic Crystalline Silicon Technology.While the current solar supply glut has resulted in some of the thin film solar film companies going out of business,big thin film suppliers continue with their growth plan.Solar Thin Film Technology is supposed to be the 2nd Generation successor to the mainstream Crystalline Silicon (c-Si) Technology which accounts for around 85% of world production.While a number of Weaker Hands in Thin Film have downed shutters,Thin Film Producers continue to grow and expand.The massive growth potential of Solar Energy makes it possible for both of these PV technologies to flourish.Thin Film Technology unlike c-Si has a number of variants.Amorphous Silicon (a-Si),Copper Indium Gallium Sulphide (CIGs) and Cadmium Tellurium (Cd-Te) are the 3 main types of Thin Film Technology.There are a number of manufacturers of all of these 3 types of Technology.CIGs Technology is said to have the most potential in improving efficiency and competing with c-Si,however Cd-Te is currently the top dog as the world’s biggest solar producer First Solar currently uses this technology.a-Si Technology is not that hot with low efficiencies however Oerlikon and Sharp are pushing ahead with developing this technology.
July 6, 2011
Solar Panel Manufacturers in USA are facing a torrid time from the falling prices of Chinese solar panels.This has caused the bankruptcies of some big solar panel companies in recent times like Solyndra,Spectrawatt and Evergreen Solar.Only those solar panel companies with the lowest cost and good quality will manage to survive the price war in solar panels that is currently on.Most companies are running losses as the prices of solar panels have decreased by 40% in 6 months.This would cause any industry to see massive bankruptcies and this is the case with the solar panel industry as well.Note Solar Industry is a new one with rapid technology and cost changes which makes startups with bad business models go bust.This is a natural effect of capitalism and nothing to be afraid of .However you have to be careful of which solar panel manufacturer to buy from as your 25 year solar panel warranty will become useless if the solar panel manufacturer from which you brought the solar panel goes out of business.On the Bright Side the sharply declining costs of solar has made it the biggest advantage of using solar power.
July 6, 2011
First Solar is going to the biggest producer of solar panels in the world despite having a solar panel technology which differs from almost all of its competitors.First Solar Solar Panels use Cadmium-Tellurium Thin Film Solar Technology while the majority of the Solar Industry uses Crystalline Silicon Technology.Despite the difference First Solar is the most valued solar stock in the world and has been for a long time.Despite stiff competition from the silicon technology and most of the thin film companies going bankrupt,First Solar has managed to hold on cutting costs and improving yields continuously.In fact First Solar Solar Panels have the lowest cost of production in the world.First Solar Solar Panels efficiency has also increased in the last few years such that First Solar is now targeting commercial segments of the market.Note First Solar earlier used to sell solar panels mostly to developers and utilities to build ground mounted solar panel farms where the lower efficiency of the Cd-Te solar panels did not matter.The reason is that in large solar farms space and area constraints are not there unlike in rooftops where the space is a major issue.
July 6, 2011
Germany till a couple of years was the home of the biggest solar panel manufacturers in the world.This was driven mainly by the German Renewable Energy Law (EEG) which is the most successful renewable energy subsidy in the world.The German Solar Market has become the biggest in the world for the last 2-3 years and an estimated 25 GW of solar panels would have been installed in Germany.Capitalizing on a large domestic market a number of solar companies like Q-Cells,Solarworld,Solon and others became the biggest in the world.However the rise of the Chinese solar panel manufactures has made these companies shrink with some of them like Q-Cells facing questions of survival.The prices of the Chinese solar panels has become lower than the costs of the German made solar modules putting the economic viability of the German solar panels in question.Though the quality of the German made solar panels is higher and some of the best solar panels in the world are produced by the Germans,the price differential has meant that Chinese have captured almost 70% of the global solar panel market leaving little for the German solar panel companies.The Italian Feed in Tariff Law Contio Energia 3 has given somewhat of a boost to the German solar panel makers as it gives higher subsidies for solar projects,farms using European based modules.However German solar panel producers are in a secular decline with most of them shifting their factories to Asia.Q-Cells and Bosch have set up big solar manufacturing facilities in Malaysia while Solarworld is doing so in the US.Another Big European Solar Producer REC is closing its factories in Norway while expanding it in Singapore.
July 6, 2011
The Indian economy has performed strongly over the last few years, regularly hitting 8% and above growth rates . This rapid economic growth has led to a significant increase in demand for crude oil and natural gas, to the extent that India is currently the sixth largest consumer of oil and gas. India is one of the biggest importers of crude oil and natural gas as it has to import 2/3rd of its requirements of Oil. Upstream activity in India has rapidly grown post liberalization with 42 active offshore rigs and several seismic vessels engaged in operations offshore on the east and west coasts. Several significant discoveries have been announced since the New Exploration and Licensing Policy (NELP) was introduced. The commercial discovery of the Dhirubhai field by Reliance in the deepwater Krishna Godavari basin has demonstrated the existence of significant reserves in the basins of India. As India imports about two-thirds of its crude oil requirement, Exploration and production of oil and gas is critical for India's energy security and economic growth. Over the years the E&P industry has registered significant growth, primarily due to spiraling crude oil and gas prices.
July 5, 2011
Natural gas is rightly termed as the Fuel of the 21st Century, has emerged as the most preferred fuel due to its efficiency and cost effectiveness. The demand of natural gas has sharply increased in the last two decades at the global level. The production of natural gas is around 87 million standard cubic meters per day. The main producers of natural gas are Oil & Natural Gas Corporation Ltd. (ONGC), Oil India Limited (OIL) and JVs of Tapti, Panna-Mukta and Ravva. Even private parties from some fields produce gas under Production Sharing Contracts. Government has also offered blocks under New Exploration Licensing Policy (NELP) to private and public sector companies with the right to market gas at market determined prices. In India most of the production of gas comes from the Western offshore area. The on-shore fields in Assam, Andhra Pradesh and Gujarat States are other major producers of gas. Smaller quantities of gas are also produced in Tripura, Tamil Nadu and Rajasthan States. OIL operates in Assam and Rajasthan States, whereas ONGC is operating in the Western offshore fields and in other states. Prior to 1987, gas prices were fixed by ONGC/OIL. since 1987, the price is being fixed by Government. The Ministry of Petroleum & Natural Gas has been regulating the allocation and pricing of gas produced by ONGC and OIL by issuing administrative orders from time to time. The gas produced by the JVs and by NELP operators is governed by the respective production sharing contracts between the Government and the producers. Under the existing policy, 100% Foreign Direct Investment (FDI) is allowed for both LNG projects and natural gas pipeline projects.
July 5, 2011
The Internet is full of websites that advertize and give you steps on how to make solar panels.In fact DIY (Do it Yourself) Solar Panels has become almost a regular industry in training common people to make solar panels at their homes.The reason given is that building solar panels at your home is much cheaper than buying solar panels from wholesalers.There are numerous books as well that you can buy on amazon that have diy solar panels.These books have nothing but a manual on how to solder solar cells together to make a solar panel.You can pretty much get this for free from any of the credible solar websites.However DIY Solar Panels throws up tons of books and website advertizements that seemingly would make you into a wizard solar panel maker.The truth is far from what these charlatans say.Solar Cell and Solar Panel prices have fallen drastically in the last few years.In fact you can buy very good solar panels from China and other places.In fact you can buy very good quality Japanese solar panels from Sharp or Sanyo at $600 for a 200 watt solar panel.
July 5, 2011
1366 Technologies has got a $150 million DOE Loan Guarantee as the startup looks to raise $300 million to fund its solar wafer producing factory.Note the company is using an innovative technology which it says will be game changer in reducing the costs for making solar wafers.Note Solar Wafer Companies in China have managed to raise scale and reduce costs substantially in recent years winning marketshare from European companies like REC and Solarworld.The smaller companies like PV Crystalox are in deep trouble because of their high cost of operations and are trading at a fractional of their book value.Its a tough environment for solar companies especially if they are starting out as established solar panel companies like Evergreen Solar are facing potential bankruptcy.Evergreen Solar got millions of dollars in grants and loans from Massachusetts however the company has been forced to shut down its factory.Like 1366 Technologies Evergreen too uses a unique technology "String Ribbon" to producer solar wafers .However it has not been able to scale and reduce costs compared to the mainstream silicon solar wafer producers like LDK and GCL.
July 5, 2011
Sharp which was the biggest solar company in 2010 in terms of revenues is being finally forced to move its production away from Japan to low cost countries in Asia.Note the relentless cut in prices of solar panels by Chinese solar panel companies has made life impossible for high cost panel companies in Europe and Japan.While US Companies like Sunpower and First Solar always had the majority of their production in low cost locales like Malaysia and Philipines,European solar firms had also started shifting their production overseas with Q-Cells moving to Malaysia and REC to Singapore.The current glut in solar panels has let to massive bloodletting in the solar industry with some established companies like Evergreen,ENER on the verge of bankruptcy.The sharp cost improvements and increased supply of crystalline silicon solar panels is set about to bring radical changes in the solar industry after a massive boom in 2010.The Second Wave of Thin Film Technology Bankruptcies has already started and we can expect more of that soon.Most of the production bases in Europe should be shuttered as well as costs have become higher than the selling prices.PV Crystalox and REC are already in a lot of trouble,cutting production and forecasting losses in the second half of 2011.
July 5, 2011
Solar Energy is the fastest growing industry in the USA and has been one of the fastest globally as well with solar demand rising by more than 150% in 2010 fueled by massive cuts in prices of solar panels especially those from China.While this has led to a major drop in solar energy stock prices this has also led to a massive boost in volumes due to demand elasticity.Only the top solar companies will be able to survive this brutal consolidation that is taking place with some companies like Solyndra already consigned to the death list.Solar Industry is a global one and has a big supply chain as well.This means that looking at only one stock market will deprive you of better opportunities that might exist in other stock markets.There is also a big supply chain associated especially with crystalline solar panels.There are companies that exist only in Polysilicon,Wafers,Cells,Modules.There are also companies that are suppliers of material like encapsulants and metal alloys to these industries.This article will give you a very broad idea on the complete list of solar energy stocks that exist in each part of the supply and different parts of the world.You can also look at the 2 solar ETFs that trade on the US stock markets TAN and KWT .
July 4, 2011
Japan has decided to from 5 consortia of three to nine companies to bid for large solar projects in Asia and Africa.The Japanese government will support these consortia with subsidies and diplomacy to take on the Chinese solar companies.Note Chinese companies have soundly beaten the Japanese in solar company rankings despite the early mover advantage.Japanese zaibatsus are falling behind the Chinese in the global solar marketshare as low costs,cheap capital and huge subsidies have bankrupted European and American solar companies.Solar Energy in Japan has a long future dating back to 1994 when the government introduced capital subsidies to boost solar energy installations on rooftops.Till 2004,Japan was the largest solar market in the world after which it was overtaken by Germany.After 2004,the growth in the solar industry tapered off as the government reduced the subsidies for solar panels to almost zero.The huge domestic market gave rise to Japanese companies like Sharp,Mitsubishi,Kyocera,Panasonic-Sanyo become top solar panel producers in the world.However the low cost Chinese solar module producers have pushed back most of the Japanese companies
July 4, 2011
LG Solar Review of Multicrystalline and MonoCrystalline PV Cell Panels Modules Prices and Comparison
The LG Group is producing solar products through two Group Companies. LG Solar Energy was formed in 2007 to produce polysilicon which is the most important raw material for the production of solar wafers.It is already selling solar modules in the South Korean and European markets and plans to rapidly expand capacity to One Gigawatt by 2012.LG Electronics , plans to invest 1 trillion won by 2015 in its solar cell business and aims to generate revenue of 3 trillion won by 2015.LG plans to increase annual production of solar cells and modules at its plant in South Korea to 500 megawatts next year and 1,000 megawatts by 2013, from 330 megawatts today.LG plans to have a completely vertically integrated business in the Solar Power and plans to install massive solar power plants in the USA as well.
July 4, 2011
Indian Electricity Companies are crying for a bailout from the government after coal prices surged last year amidst shortages of coal.Note before the Lehman crisis,Indian private […]
July 3, 2011
Photovoltaic Cells have grown tremendously in the last few years spurred on by lowering costs and high demand in European countries like Germany.Photovoltaic Cell Manufacturers have also increased particuarly in low labor cost regions of Asia like China and Taiwan.In fact most of the solar panels have solar cells from companies in Asia.Solar Cell Manufacturers have incresased their capacity at a fast pace to meet the increasing demand.Currently due to oversupply of Photovoltaic Cells,the prices of solar cells have crashed with top quality solar cell prices almost 50% down from that one year ago.This is one of the best times to install solar cell panels in your roof given the rapid decline in the cost.Most of the independent solar cell suppliers are from Taiwan and some from China.European solar cell producers have mostly disappeared due to the high cost base of the European factories.
July 2, 2011
Vestas has been getting bigger orders and has been streamlining operations,however its stock price has continued to go down as investors see bleak future prospects wit hthe entry of Korean shipbuilders into the industry.Other heavyweights like Gamesa and Suzlon too have faced massive losses as margins have evaporated in the face of declining topline and prices.But now Vestas has got a lifeline from the renewable energy subsidiary of the French giant utility EDF.The order from is for 2000 MW of Wind Turbines over the next few years.While pricing was not disclosed,it would be certainly be at a discount to the normally premium prices charged by Vestas.This given order visibility to Vestas and provides price safety for EDF.The next frontier for Wind Energy Companies is going to be Offshore Wind and Siemens has stolen a march.Vestas is not going down without a fight recently introducing a 7 MW wind turbine for this segment
July 1, 2011
Solar Thin Film Companies are coming under siege again due to the relentless fall in the prices of crystalline silicon panels in recent months of 2011.Note large number of thin film companies went bankrupt the last time polysilicon prices fell off a cliff in the post Lehman crisis period in 2008 end.Applied Material the biggest solar equipment company killed off its SunFab Division which has a large customer list.Applied Materials saw the writing on the wall and concentrated its efforts on crystalline silicon equipment buying HCT Shaping and Baccini to become a billion dollar supplier of solar equipment.A number of weaker hands in solar thin film went out of business.However the prodigious growth in solar demand in 2010 saw large investments being made again.The biggest failure (not complete yet) seems to be the DOE and Obama darling CIGs startup Solyndra which has already used up a billion dollars with nothing much to write home about .Now Republicans are investigating whether the more than $500 million US government loan was done improperly.Abound Solar a CdTe startup has also managed a $400 million loan and I doubt whether it will manage to ever pay off the loan given that the lowest cost manufacturer of solar panels First Solar itself is under pressure from sharp cost reduction by integrated solar panel companies like Trina Solar.
June 30, 2011
Huge Solar Panel Projects are being planned in the USA by solar developers and utilities as solar panel prices have fallen by 20-30% in the second quarter of 2011 as solar panel manufacturers are faced with oversupply and inventory issues.Note building both coal and nuclear power plants in the US has become increasingly difficult with pollution and climate change issues coming to the fore.While natural gas is getting a boost due to cheap shale gas discoveries,solar energy is picking up pace due to the government support in the form of DOE Loan guarantees and Treasury Grant programs like 1705.Recently two very large solar panel projects have been announced or are in the process over the next 3-4 years.
June 23, 2011
Solar Industry Mergers and Acquisitions (M&A) have picked up pace in recent times with a number of companies in distress with supply exceeding demand as Italy suddenly changed its solar subsidy policy in April 2011.With high inventory levels and prices crashing only the biggest and best solar panel manufacturers are managing to thrive.Note the Solar PV Industry has not seen too much M&A unlike the Solar Thermal Industry which has always been a hot area for M&A activity as giant industrial groups like Siemens,Areva,Alstom and GE have bought startups to improve their technology offerings.With the Solar PV industry having crossed more than $50 billion mark in 2010,more and more MNC conglomerates have now starting buying solar companies at cheap valuations.Here is a list of the recent buyouts,stake buys and mergers in the Solar PV Industry that have taken place recently.
May 31, 2011
India and China are largely dependent on Coal for fueling a majority of their energy needs despite the evident disadvantages of coal.China derives almost 80% of its electricity from coal while India uses Coal for 50% of its Energy Needs.Most of the new power plants being built in India have plans to use thermal power which means that the coal demand is going to skyrocket even as these 2 Asian giants are already suffering from coal shortages.India's Coal Production is falling short as the Environment Ministry makes it tough for the coal miners to dig up virgin forest areas even as private Indian power companies keep on building gargantuan thermal power plants of more than 4,000 MW capacity.Most Indian companies are now racing to acquire coal mines abroad joining the Chinese companies.Seeing the massive potential in coal,international resource giants such as Rio Tinto and others are trying to access coal assets as well.
May 31, 2011
Japanese Nuclear Giant Toshiba which is the second largest seller of complex nuclear equipment globally is looking to shift its focus towards Renewable Energy and Energy Efficiency.The company is already facing delays in shipping nuclear reactors to customers as the Fukushima Disaster makes governments around the world rethink their nuclear power ambitions.The Nuclear Energy Disadvantages are winning over the Advantages currently in public sentiment.Toshiba which acquired US Westinghouse has a target of selling 39 nuclear reactors which is getting delayed.With advanced nuclear power countries like Germany,Switzerland and Japan killing nuclear energy,the going looks tough for Toshiba.The company was already facing tough competition from the GE-Hitachi and Areva as well as new players from South Korea and China in the nuclear equipment market.
May 30, 2011
Coal has become the hottest energy topic in the world’s fastest growing economies India and China which depend on Coal for a majority of their Energy […]