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Chart: The death spiral of solar bankruptcies (& counting)

Ucilia Wang — Thu, 05 Apr 2012 22:30:51 +0000

The solar death spiral has been long and ugly. Over the past year, there have been over a dozen stalwarts and startups that have headed to bankruptcy court.

Two companies even filed for bankruptcies in this week alone: manufacturer Q-Cells, which was the worlds largest solar cell maker in 2008 and power plant developer Solar Trust of America, which just a year ago was on its way to build a few gigawatts of solar projects in the American Southwest.

The fate of Solar Trust, which is mostly owned by Solar Millennium, is a reminder of the difficulties of shepherding a power plant project to completion, even when all the permits are in hand. Solar Trust’s crown jewel project was the 1 GW Blythe Solar farm in California, and at one point the company was set to snag a $2.1 billion federal loan guarantee to build it before it decided to withdraw from the loan guarantee process last summer and change the technology it would use for Blythe.

Solar Millennium tried to sell Solar Trust to a fellow German company, Solarhybrid, only to see Solarhybird, too, file for bankruptcy last month.

So here’s our tally of the solar company bankruptcies over the past year and there’s probably more that we haven’t heard about. Many of them are manufacturers who had a tough time dealing with lower-than-expected demand, plummeting prices and financial market turmoil.

Company	HQ	Primary business	Date
Solyndra	U.S.	Solar panel maker	August 2011
Evergreen Solar	U.S.	Solar panel maker	August 2011
SpectraWatt	U.S.	Solar panel maker who sold all of its equipment for $4.9 million to Canadian Solar	September 2011
Stirling Energy Systems	U.S.	Equipment and project developer	September 2011
Photowatt	France	Solar panel maker (sold to EDF)	November 2011
Solon	Germany	Solar panel maker, project developer (assets sold to Microsol)	December 2011
BP Solar*	U.K.	*The energy giant didn’t file for bankruptcy but is winding down its solar business (equipment and installation).	December 2011
Energy Conversion Devices	U.S.	Solar panel maker	February 2012
SunConcept	Germany	Project developer	February 2012
Ralos New Energies	Germany	Project developer	February 2012
Scheuten Solar	Netherlands	Solar panel maker (its German subsidiary filed for bankruptcy); assets to be sold to Sunway	February 2012
Solarhybrid	Germany	Project developer	March 2012
Odersun	Germany	Solar panel maker	March 2012
Q-Cells	Germany	Solar panel maker, project developer	April 2012
Solar Trust of America	U.S.	Project developer (part of Solar Millennium)	April 2012

Photo courtesy of Josh Giovo via Flickr

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After Solyndra: analyzing the solar industry

Ucilia Wang — Fri, 03 Feb 2012 20:44:10 +0000

Solar companies worldwide will remember 2011 as a dark time in their history. The failing of Solyndra symbolizes that market volatility, and 2012 no doubt started with trepidation. But as we have mentioned before on GigaOM Pro, the industry has survived nonetheless. This report analyzes the current state and future concerns of the solar industry, with a particular focus on the photovoltaic industry and the U.S. market. From the silicon companies to inverter manufacturers to government venture money, here is what to expect as the industry marches toward its uncertain future. Additional companies mentioned in this report include First Solar, Intel, NRG Energy and SunEdison. For a full list of companies, and to read the full report, sign up for a free trial.

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The new year brings continued solar strife

Ucilia Wang — Wed, 04 Jan 2012 18:49:18 +0000

The turning of the new year didn’t make the solar industry any easier for solar manufacturers. Power electronics maker, Satcon Technology, announced Wednesday it’s laying off 35 percent of its workers and shutting down its factory in Canada. The news followed reports earlier this week that a Silicon Valley solar panel maker canceled a plan for a solar factory in Michigan.

Boston-based Satcon makes inverters that convert direct current from solar cells to alternating current to feed to the grid. Inverters play a critical role in solar power generation, and startups that aim to improve inverters’ performance have attracted some big investments from venture capitalists.

Satcon’s decision to close its factory in Ontario and cut about 140 employees worldwide reflects a trend that took hold last year when solar companies – mostly solar cell and panel makers – began announcing layoffs, factory closures and bankruptcies. A pileup of solar energy equipment and the corresponding fall in prices have caused not only declining profits but a trade complaint against Chinese silicon solar cell and panel makers.

The complaint contends Chinese manufacturers have received unfair government help to boost their production and sell their products at below-market prices. The U.S. International Trade Commission and the Department of Commerce are reviewing the complaint, which seeks to impose duties on Chinese imports.

The global inverter market saw a 20-percent decline in revenue during the third quarter of 2011, said IMS Research last month. Although prices stopped falling quickly in the third quarter, they were still 15 percent lower on average than in 2010.

Meanwhile, San Jose, Calif.-based GlobalWatt said it will ditch a plan to build a $177 million silicon solar panel factory in Michigan. The company apparently had started production on a small scale at what was to be a larger factory in Saginaw, Mich., and NBC has reported Michigan officials are saying GlobalWatt presented false information when it tried to line up government incentives for the factory.

Here’s our list of solar companies that have gone out of business or shrunk their operations in light of the tough market:

Company	Action	Date
BP Solar	Announces it’s shutting down	December 2011
Energy Conversion Devices	Announces temporary suspension of all factories	November 2011
Evergreen Solar	Declares bankruptcy	August 2011
MEMC Electronic Materials	Idles one factory	December 2011
REC	Cuts silicon wafer production in Norway	January 2012
Satcon Technology	Closes inverter factory in Canada	January 2012
Schott Solar	Closes cell factory in Germany	December 2011
Solar Millennium	Files for insolvency	December 2011
Solland Solar	Exits cell production	January 2012
Solon	Shuts down U.S. factory. Files for insolvency.	December 2011
SolarWorld	Shuts U.S. factory	September 2011
Solyndra	Declares bankruptcy	August 2011
SpectraWatt	Firesale for $4.9 million	September 2011
Stirling Energy Systems	Declares bankruptcy	September 2011

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Green IT 2012: looking for bright spots amid the clouds

Adam Lesser — Wed, 28 Dec 2011 16:01:09 +0000

As we look toward the next year, the cleantech sector faces many challenges, which we examine in detail in this 2012 outlook. Renewable energy generators encounter an increasingly difficult subsidy environment, and key cleantech innovations like electric vehicles face an uphill climb in terms of connecting with a larger market. The effort to build cleaner data centers continues. Meanwhile, low-power chips will get a shot at creating further energy savings at the server level. There remains, however, something of a silver lining, with companies like Nest poised to innovate in the home energy management space and Silver Spring Network’s potentially successful IPO offering a shot in the arm for the smart grid. Additional companies mentioned in this report include ARM, Calxeda, Getaround and Solyndra. For a full list of companies, and to read the full report, sign up for a free trial.

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The tough market for solar in 2011

Katie Fehrenbacher — Wed, 21 Dec 2011 16:47:00 +0000

Companies continue to bow out of the solar market in 2011 following both bankruptcies and strategic decisions to exit the market. This week it’s BP’s solar panel arm BP Solar, which is shutting down, and says it “simply can’t make any money from solar,” as well as German solar project developer Solar Millennium that filed for insolvency. Last week, it was German solar panel company Solon that filed for insolvency.

One of the reasons for these global solar struggles is thanks to Chinese solar manufacturers, which flooded the market with low-priced solar cells and created an oversupply. Global solar makers are having to sell solar below cost to just survive. While that’s bad for these companies, it’s good for the solar consumer, and also will lead to healthy consolidation in the overall solar market. There are also lingering effects of the recession on these solar firms.

Company	Action	Date
BP Solar	Announces it’s shutting down	December 2011
Evergreen Solar	Declared bankruptcy	August 2011
Solar Millennium	Files for insolvency	December 2011
Solon	Shuts down U.S. factory. Declared insolvency.	December 2011
SolarWorld	Shuts U.S. factory	September 2011
Solyndra	Declared bankruptcy	August 2011
SpectraWatt	Firesale for $4.9 million	September 2011
Stirling Energy Systems	Declares bankruptcy	September 2011

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Solar complaint against China moves forward

Ucilia Wang — Fri, 02 Dec 2011 19:06:36 +0000

A complaint accusing Chinese solar makers of flooding the U.S. market with unfairly low-priced goods cleared a hurdle to move forward Friday. The U.S. International Trade Commission voted six to zero that there is reasonable indication that U.S. manufacturers have been harmed from the alleged actions.

The commission’s decision is preliminary and sets the stage for more investigations into the case, which was filed by a coalition of seven silicon cell and panel makers in the U.S. in October. The U.S. arm of the Germany-based SolarWorld has been the public face of the Coalition for American Solar Manufacturing, which hasn’t divulged the identity of the rest of the six manufactures. The complaint kicked off a storm of opposition and a flurry of press release from both sides as they gained supporters and geared up for the fight.

The SolarWorld-led coalition contends Chinese solar cell and panel makers have set unfairly low prices in order to nudge competitors out of the way. The coalition also alleged the Chinese government’s hefty financial support for its solar manufacturers, something the government should’ve disclosed fully but didn’t, has hurt the U.S. industry. The coalition says it wants the U.S. government to impose duties on imported Chinese cells and panels to offset the impact of Chinese subsidies and the pricing practices of Chinese manufacturers.

The commission’s role is to determine whether the U.S. solar industry has indeed been harm by the alleged actions, and it will do so in preliminary and final phases of its investigation. The Friday vote was the preliminary one, and it cleared the way for the U.S. Commerce Department to review the case. The commerce department’s role is to determine whether there has been a dumping of unfairly priced Chinese solar cells and panels and what the penalties, in the form of the duties, should be imposed on Chinese goods.

The commerce department is scheduled to reach a preliminary vote on the two questions early next year, and if it finds there have been unfair practices, then it will continue to its final phase of the investigation. Both the commission and the commerce department have to find harm and determine there was anti-dumping in order to slap duties, Peg O’Laughlin, a spokeswoman for the commission, told us.

The coming battle

Both sides will have more opportunities to influence the decisions of both authorities. Ever since the coalition filed its complaint, it’s been touting the growing number of solar companies that have supported its cause. On Friday, it also trumpeted the number of federal lawmakers who have sided with them: There are 59 members of the House and Senate, all of them Democrats.

In response to the complaint, a group of 25 manufacturers and installers formed the Coalition for Affordable Solar Energy last month and argued the complaint would stymie healthy competition and lead to higher solar energy prices and slow down market growth. It, too, has been lining up supporters. Among the 25 members are silicon producer MEMC Electronic Material and its project development arm, SunEdison, SolarCity, Sungevity, SunRun and Chinese solar panel makers Suntech Power, Trina Solar and Yingli Green Energy.

“The entire solar industry has worked extremely hard to reduce the costs in the last five years. (The complaint) will defeat all the advancements we’ve made in this industry,” said Lyndon Rive, CEO of SolarCity, during an interview this week.

The anger toward Chinese manufactures has grown this year as the global solar industry suffers from producing way too many goods than the market demands. The primary causes are changes in government incentives and the weak financial market in Europe: the largest solar market. A buildup of unused solar panels in warehouses has caused prices to plummet by 30-40 percent, and that in turn prompted some manufacturers to sell at a loss.

The failing of Solyndra and the bankruptcies filed by SpectraWatt and Evergreen Solar earlier this year also have fanned resentment toward China, even though SolarWorld and its coalition began working on their petitions before Solyndra’s failing became known.

To complicate the dispute, China has weighed in. The Chinese government announced its own probe into whether U.S. policies and subsidies have “promoted trade barriers.” That, in turn, prompted some Chinese solar companies to emphasize that they really, really don’t want any trade war on either side of the Pacific.

Photo courtesy of Suntech Power

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First Solar: Boosting production is a bad idea

Ucilia Wang — Thu, 03 Nov 2011 22:18:17 +0000

Solar manufacturers have been on supercharged expansion mode over the past five years in order to cut costs and solar electricity prices. But to continue that march at this point is just unwise, and this belief underlies First Solar’s decision on Thursday, to put off bringing on line a solar panel factory in Vietnam.

The solar panel maker broke ground on the 250 MW factory only in March this year and had planned to begin production there in the second half of next year. The Vietnam project was part of a larger plan to nearly double the company’s overall production capacity by 2012. Boosting production is a crucial way for a company to reduce manufacturing costs.

But the global solar market has been marked by a bumper crop of solar panels this year. The combination of declining government subsidies in Europe – the largest solar market in the world – and the weak economy has depressed demand. The oversupply problem is so overwhelming that prices of solar panels have plummeted 30-40 percent and manufacturing giants such as Suntech Power and JA Solar, are cutting production. Other companies have closed factories, like SolarWorld and Solon. Several have gone bankrupt: see, Solyndra, SpectraWatt and Evergreen Solar.

Smart growth

First Solar’s interim CEO, Mike Ahearn, on Thursday said the company’s most pressing focus now is not to build more factories but to send more people to emerging markets to learn about those regions’ electric markets and policies. “Building more factories absent this demand creation doesn’t lead to growth and prevents us from focusing on the right things to do. What we need to do is to create new markets,” Ahearn said Thursday as he discussed the company’s third-quarter earnings in a conference call.

The company actually released its numbers last week, a day after it disclosed the sudden departure of its CEO, Rob Gillette. Ahearn was the CEO of First Solar for nearly 10 years before leaving the post in 2009 and handing the reigns to Gillette in October 2009. Ahearn said Gillette left because he was no longer a good fit for the company, not because of any shortcoming.

Gillette’s tenure was filled with plans to build many factories and to enter new markets. The company has completed a few factory projects during his time, including a 250 MW manufacturing center in Germany. He also talked about India, China, Australia, Middle East and Africa as promising markets for First Solar to conquer. But perhaps he wasn’t moving as fast as he should have into emerging markets.

Although Europe remains the largest market, its growth is slowing. The U.S. should grow faster because many states require their utilities to sell renewable energy and offer rebates for consumers and businesses to put solar on rooftops. But Ahearn also remarked that there haven’t been many new state solar programs for many years – the domestic solar industry is growing on the backs of existing programs and subsidies.

Ahearn said he has come up with a few reasons for why First Solar (and perhaps other leading manufacturers) haven’t moved as quickly into emerging markets. First, the company is continuing to invest in maturing markets when it should focus more on creating new ones. The other is the “short term fixation with earnings per share,” which can undercut the company’s willingness and ability to think long-term.

Although the Vietnam factory is now on hold, First Solar still plans to “continue developing” the previously announced factory in Mesa, Ariz., to serve the company’s 2.7 GW of solar farm projects in North America. The company held a dedication ceremony at the factory site in August this year and was planning to start production at the 250 MW plant in the third quarter of 2012.

The company also announced a new project on Thursday: NRG Energy has hired First Solar to build a 66 MW project in Lancaster, Calif. Pacific Gas and Electric will buy the electricity from the project, which should be completed in the third quarter of 2012.

Photos courtesy of First Solar.

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Green IT Q3: Solar stumbles while car sharing zooms ahead

Mon, 10 Oct 2011 07:01:00 +0000

The trials and tribulations of the solar industry dominated the third quarter as warnings about a storm of dangerous market forces in the industry finally reached an outcome with Solyndra’s bankruptcy. But not all was dismal for the cleantech industry during the quarter. Car sharing continues to reduce resource consumption, and much capital flowed to that sector. On the data center side of the industry, Google provided insight into exactly how much energy the tech giant uses, as well as the carbon footprint of its data centers. Companies mentioned in this report include Solyndra, Zipcar, Airbnb and Silver Spring Networks. For a full list of companies, and to read the full report, sign up for a free trial.

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Fire sale: Intel-backed SpectraWatt sold! … for $4.9M

Ucilia Wang — Fri, 30 Sep 2011 16:40:32 +0000

After years of incubation and at least $91.4 million of private capital from investors including Intel, all the capital equipment of silicon solar cell maker SpectraWatt has been sold to Canadian Solar for about $4.95 million. The sale still needs final approval from the bankruptcy court, which is scheduled to do so on Oct. 6. The auctioneer, Heritage Global Partners, also plans to auction off bankrupt solar panel maker Solyndra.

The sale is a dismal end for SpectraWatt, which was incubated inside Intel before being spun off in 2008 with $50 million in capital from Intel, Goldman Sachs’ Cogentrix Energy, PCG Clean Energy and Technology Fund, and Solon. Solon, a solar panel maker, had planned to buy solar cells from SpectraWatt.

SpectraWatt initially wanted to build a factory in Oregon and had planned to ship silicon solar cells to panel makers in mid-2009. The cell maker then decided to move to New York in 2009, citing the more generous incentive package offered by the state. The company’s CEO, Andrew Wilson, told me then it could set up manufacturing at a former chip factory in New York, which would’ve been much cheaper than its initial plan of building a factory from the ground up in Oregon.

The company made the move to New York and in spring 2010, announced it had raised $41.4 million in convertible debt from Intel, Cogentrix, PCG Clean Energy & Technology Fund, and two undisclosed investors. SpectraWatt had completed the factory and was ramping up production in order to start shipment in the second quarter of 2010.

Although the company promised to deliver efficient solar cells, it wasn’t able to compete in a market filled with much larger rivals who could supply silicon cells at cheaper prices. SpectraWatt apparently also ran into production problems. In December 2010, it was getting ready to lay off workers and shut down its factory. The company filed for Chapter 11 last month.

Two months before it disclosed its layoff plan, though, Wilson gave a rosy forecast of the company’s prospect, reported the local paper, the Poughkeepsie Journal. “Things are going gangbusters here. I don’t know that I could describe a better situation than the one we’re in now,” Wilson said at the time.

While that optimism now seemed misguided, it sounds similar to the statements from Solyndra’s CEO just before that company filed for bankruptcy, too: “We’re growing, doubling in size year-over-year, and on track.” Solyndra then laid-off 1,100 workers, shuttered the factory, which it had built a year earlier using a $535 million federal loan guarantee, and filed for bankruptcy. Solyndra’s auction is scheduled for Oct. 27.

Photo courtesy of Diana Parkhouse via Flickr.

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Solar struggles: Stirling Energy Systems files for bankruptcy

Katie Fehrenbacher — Thu, 29 Sep 2011 18:02:33 +0000

Solar thermal company Stirling Energy Systems has filed for bankruptcy, according to Renewable Energy World. In contrast to the recent bankruptcies of solar photovoltaic players SpecraWatt, Solyndra and Evergreen Solar, Stirling Energy Systems developed solar concentrators based on stirling engines, which use the sun’s heat to produce electricity, and planned to build projects to sell the power to utilities.

Stirling Energy Systems has been struggling for a while, and lost out on most of two solar projects it had previously lined up. California regulators approved two of Stirling Energy System’s solar projects totaling 1372.5 MW last year, but Stirling Energy System’s sister company, developer Tessera Solar, subsequently sold those projects off to different buyers when it wasn’t able to line up the financing to build them. Utility Southern California Edison, which signed a deal to buy the power in 2005, canceled its contract with one of the projects.

Tessera Solar sold off one project to K Road Power, who has since said it plans to use stirling engines only for a small portion of its project. Another buyer, AES Solar Power, has said it will use solar panels for its project instead of stirling tech. San Diego Gas & Electric told us it canceled the contract to buy power from the AES’s project in spring this year.

As with the bankruptcies of the solar PV makers, the dropping price of silicon and solar cells played a role here, too. Some project developers are turning to solar PV as a more attractive and cheaper option for utility-scale solar plants compared to solar thermal technology. For example, last month Solar Trust of America, which has been developing a 1 GW solar farm in California, announced it will use PV instead of solar thermal technology for the first 500 MW of its project.

Stirling engines have long been thought of as a promising technology to build solar farms, but the matchup has yet to become as popular as other types of solar thermal technologies and solar panels. Stirling Energy Systems developed a 25-kilowatt stirling engine system, which included a giant parabolic dish of mirrors that concentrate sunlight to heat up hydrogen gas inside what’s called a “power conversion unit.” The unit runs a 4-cylinder engine that in turn drives a generator to produce electricity.

One of the big losers in this bankruptcy is Irish firm NTR, which came to the rescue of Stirling Energy Systems in 2008 and invested $100 million for a 52-percent stake in the company. Boeing has also said it planned to partner with the company to develop Boeing’s high-concentration photovoltaic (HCPV) solar power technology.

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