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Summary:

There has been no shortage of projections that this will be a dark year for the solar market. Lux Research forecast nearly a year ago that solar supply would exceed demand in 2009. Last fall, the firm reiterated its prediction and said it expected margins to […]

There has been no shortage of projections that this will be a dark year for the solar market. Lux Research forecast nearly a year ago that solar supply would exceed demand in 2009. Last fall, the firm reiterated its prediction and said it expected margins to become increasingly difficult, with the weakest players either failing or being acquired. And in December, the Information Network said it anticipated global growth in the solar market to slow to 26 percent in 2009, down from 48 percent last year. We’ve been approaching the tipping point for awhile now, and according to the latest research from Lux, the solar market is finally tumbling over — with a push from the global economy.

solar-nellis

“While oversupply in the solar market has been looming for some time, the correction has been more aggressive due to the economic crisis,” Lux senior analyst Ted Sullivan said in a release this morning. At this point, Sullivan and his team expect cell and module capacity to reach 10.4 GW, outpacing demand nearly twofold. The overall market will shrink to $29 billion and 5.3 GW, down from $36 billion and 5.5 GW in 2008, according to the Lux report.

But it’s not all doom and gloom for the solar industry. Despite expecting “widespread company failure,” Lux anticipates gains for thin-film and CIGS this year and significant strides toward grid parity — making the survivors more competitive than ever on the larger energy market.

Photo credit SunPower installation at Nellis Air Force Base

  1. Michael Anderson Wednesday, February 18, 2009

    Actually the best report available on the current state of worldwide solar production supply and demand was just released 2 weeks ago by Greentech Media. I’ve seen Lux’s research in the past and it is good — but Greentech Media and The Promethius Inst. once again have shown me why they are the best. I would suggest to anyone that needs to be in the know here, to pick up a copy. Well worth it.

    http://www.greentechmedia.com/GreentechMedia/Report/PVTechnologyProductionCost2009Forecast.html

    Michael Anderson
    New York/London

  2. Environmental Capital – WSJ.com : Green Ink: Big Biofuel and Cheap Solar Thursday, February 19, 2009

    [...] Solar power might be on the cusp of getting a lot cheaper: A new report from Lux Research says solar prices will plummet this year as supply far outsrips demand. That might mean a big shakeout for lots of solar-panel makers, but will also accelerate solar’s lunge at grid parity, in the WSJ (sub reqd.) and Earth2Tech. [...]

  3. INFRASTRUCTURIST » Blog Archive » Thursday’s Headlines Thursday, February 19, 2009

    [...] The stimulus isn’t looking like a cure all for the ailing wind and solar industries. (Green Inc, Earth2Tech) [...]

  4. Sweet Solar Home » Blog Archive » Rise & Shine: February 19, 2009 Thursday, February 19, 2009

    [...] Solar Shakeout Under Way, Serious Oversupply to Come, Report Says We’ve been approaching the tipping point for awhile now, and according to the latest research from Lux, the solar market is finally tumbling over — with a push from the global economy. TECHNOLOGY [...]

  5. Solar Prices Drop, Deeper Discounts Expected « Earth2Tech Monday, February 23, 2009

    [...] companies able to negotiate higher prices, this year is looking dark for solar across the board. Last week, Lux Research said it expects cell and module capacity to reach 10.4 GW, outpacing demand nearly twofold, and the [...]

  6. INFRASTRUCTURIST » Blog Archive » The Morning News Monday, February 23, 2009

    [...] The stimulus isn’t looking like a cure all for the ailing wind and solar industries. (Green Inc, Earth2Tech) [...]

  7. Solar prices dropping fast | csmonitor.com Wednesday, February 25, 2009

    [...] clean-energy blog Earth2Tech cites a report by the emerging-technology-consulting firm Lux Research that predicts a major shakeout in the solar [...]

  8. Spain’s Fotowatio Expands its Solar Reach in the U.S. « Earth2Tech Monday, March 2, 2009

    [...] deal could be one of many for the solar industry in 2009, which analysts say will be a dark year for solar, with a looming oversupply of solar cells and modules and a global economic crisis spurring [...]

  9. SunEdison Seals $20M for Solar Farms as Rivals Sell Their Assets « Earth2Tech Tuesday, March 3, 2009

    [...] many solar companies are facing these days as looming oversupply and the global economic crisis threaten to shake out the sector. Today, solar service provider SunEdison said it managed to close a $20 million deal with Union [...]

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