Sol Voltaics, which is discussing its product and funding for the first time this week, said it has developed a low cost way to make tiny nanowires out of the semiconductor gallium arsenide. The company turns these nanowires into an ink, which can be layered onto basic solar panels and boost the efficiency of a standard panel by 25 percent.

The idea is that solar panel makers would want to buy this technology because they can sell the more efficient panels at a higher price, and raise their margins. In addition, the overall installed cost of the more efficient solar panels (they produce more power) could be lower by 15 percent to 20 percent.

Swedish solar innovation

Founded in 2008, Sol Voltaics won’t be producing its nanowire ink — called SolInk — at pilot scale until 2015, and commercial scale in 2016. But it’s already started to prove that its technology works, and has had its nanowire cells certified by research firm Fraunhofer for an efficiency of 13.8 percent. This year the company is focused on demoing how its ink boosts efficiency on a larger scale, and in 2014 they’ll work on perfecting the equipment that its customers will use to cover panels with the ink.

With just 20 employees, Sol Voltaics has been operating in a relatively lean mode for a solar manufacturing company. To date the startup has raised just $11 million in funding from private and public funders and family offices, including Industrifonden, Foundation Asset Management, Scatec, Nano Future Invest AS, Nordic Innovation and Vinnova. The company hopes to raise another $10 million to $20 million this year, and plans to cap all of its funding at $50 million by 2016.

Sol Voltaics has some well-known names in the solar and venture capital sectors. The company was founded by Lund University Professor Lars Samuelson, who is an expert on the type of semiconductor that Sol Voltaics uses to make its nanowires. The company is led by Dave Epstein, who is a serial entrepreneur and former partner with Crosslink Capital, and Magnus Ryde, who was the former CEO of TSMC America, is Sol Voltaics Chairman.

How does it work?

Sol Voltaic’s innovation is that it’s figured out how to make tiny wires using the normally expensive but highly efficient semiconductor gallium arsenide. Solar scientists have spent years using gallium arsenide in various ways to make ultra-efficient solar cells, but the only way the material can be cheap enough to actually be used on a commercial scale is if it’s used in very small amounts — hence the nanotech wire part. But, again, in previous years the production of nanowires has also been relatively expensive.

The breakthrough came when Samuelson figured out a way to make the gallium arsenide nanowires in a gas phase instead of in a solid phase. Sol Voltaics calls this their aerotaxy process. Under the right conditions, in an air reactor, the company can grow these nanowires in seconds and store them in a liquid, producing a sort of ink.

Sol Voltaics wants to take this ink and sell it to solar panel makers, alongside production equipment that they can use to layer the ink — inkjet style — onto their own solar panels. The nanowires in the ink act as guides for the light and concentrate it. The company says the capital expensive of the ink and machines add 1 to 2 cents per Watt for the panels.

Sol Voltaics is targeting Chinese and other global silicon solar makers that are struggling and producing many of their panels at a loss right now. Proving that the technology can help them out — and is worth the investment — will take quite a few key partners and demonstrations. The good thing, though, is that if one customer starts using it as a competitive advantage and it works, others will want to use it to keep up.

Some of these huge solar maker players will have to survive, and could adopt and invest in new technologies to do that. The ones that do survive, will see the continued solar panel market explode over the coming years. There was a record-breaking 3.3 gigawatts worth of solar panels — or 16 million individual solar panels — installed in the U.S. in 2012, making solar power the fastest-growing energy source domestically.

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The federal lawsuit, filed Thursday in San Francisco, accuses major Chinese solar panel makers Suntech Power, Trina Solar, Yingli Green Energy, as well as their suppliers and banks, of colluding to undercut competitors by flooding the U.S. market with products at below cost, Bloomberg reports. Solar panel prices fell 75 percent over four years as a result and forced Solyndra to file for bankruptcy over a year ago, Solyndra says.

Solyndra is seeking $1.5 billion in compensation for the loss of its business value.

The lawsuit seems an odd move for the California company, though winning the lawsuit could help it pay off its list of creditors. The lawsuit also will shine a new spotlight on the trade practices of Chinese solar cell and panel makers, who have risen to dominate the world’s solar market. A day before Solyndra filed the lawsuit, the U.S. Department of Commerce issued a final decision on tariffs against Chinese silicon solar cell makers after determining that the companies had received unfair subsidies from the Chinese government and were selling their products at below fair market values.

Chinese manufacturers are facing similar trade complaints in Europe. The Chinese government is understandably unhappy with the commerce department’s decision and may slap tariffs on silicon – a raw material in solar cells – from the U.S.

Since its bankruptcy filing, Solyndra hasn’t been able to find a buyer for its technology. The gleaming factory is in the process of being sold to Seagate Technology, a maker of data storage devices.

Solyndra’s rise and fall touched off a political storm about whether the government placed too big of a bet on cleantech companies lie Solyndra, which received $535 million loan guarantee to build a factory. The company was counting on the new factory to mass produce its solar panels, which were consisted of solar cell-filled tubes, and drive down its costs and therefore prices for those panels. The company, which also had raised over $1 billion in private money, couldn’t reduce its costs fast enough, however, before it ran out of money and went bankrupt.

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The Japanese government is set to start a major incentive program for clean power this July, roughly a year after it passed legislation to create the program. The incentives will come in the form of guaranteed, premium prices that utilities must pay for renewable energy such as solar, wind, geothermal. Under a proposal, solar electricity could fetch roughly twice the price that Japanese households currently pay for power, Reuters reported.

“What we are most bullish on is the Japanese market,” said Smittipon Srethapramote, vice president of research at Morgan Stanley, when he was asked about solar market growth worldwide at a Greentech Media’s solar conference panel in Phoenix this week (via webcast). “Traditionally it’s been a closed market, where you can only buy Japanese. But 20 percent of the (solar panel) sales were from foreign companies in 2011.”

Some solar companies have increased their sales efforts in Japan. China-based Yingli Green Energy announced on Friday that it’s set up a Japanese subsidiary. SunPower’s CEO, Tom Werner, told analyst during a conference call on Thursday that Japan is the company’s largest market in Asia, and it shipped “record volumes” during the first quarter of this year. SunPower has a supply deal with Toshiba.

The CEO of China-based Trina Solar, Gao Jifan, told Dow Jones in March that he expected “sales to Japan to grow aggressively in 2012.”

Suntech Power, another big Chinese solar panel maker, made a go at the Japanese market when it bought a Japanese solar panel maker, MSK, in 2006. Japan was a hot market then, thanks to government incentives, though it has since moved down in the world market ranking when the government cut subsidies in the mid-2000s. Japanese solar panel makers also began their slide in the ranking of solar cell and panel makers as Chinese companies and Arizona-based First Solar began to significantly boost their production and sales. Until 2007, Sharp was No. 1 and Kyocera No. 3. In 2011, Sharp was No. 6 and Kyocera No. 10.

Although Suntech has been selling far more solar panels to other countries such as Germany, Italy and the United States, it’s increased sales to Japan. Revenues from Japan reached $143.9 million in 2011, up from $134.2 million in 2010 and $81.6 million in 2009, according to its annual report.

Sharp and Kyocera will still enjoy some home-court advantage, but they will face stronger competition from other solar energy equipment makers as Japanese developers and banks gear up for building big solar projects. Both solar panel makers already have teamed up with developers to build projects. Some banks and developers have announced projects but haven’t named their suppliers (see our chart tracking some of the proposed projects).

Photo courtesy of Solar Frontier.

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I was reminded of this tension when a SolarWorld executive asked me jokingly (or not) why the lanyard for my badge featured Suntech Power’s logo, and if I could be fair in my coverage if I was willing to wear that? As I looked around the conference, I saw a number of people sporting plain lanyards with no logos — I guess I should bring my own lanyard from now on.

Notwithstanding the controversy surrounding the trade dispute, the trade show offered an interesting look at prototype solar panels, robotic technology, marketing strategies and politics. Some solar companies highlighted how efficiently their solar cells and panels can convert sunlight into electricity. This marketing reflects the pressure manufacturers are under to boost those efficiency figures quickly because doing so cuts costs.

And given that where stuff is made carries a political overtone these days, it was not surprising to see companies such as Stion splashing the image of the American flag as the backdrop of its booth. On the other hand, Shinsung Solar Energy was proud to use “powered by Korea” as part of its slogan.

Here are some highlights from the trade show:

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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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The potential of China as a major market for solar demand (not just a hub for manufacturing) has been bandied about for a few years now. When the Chinese government announced the “Golden Sun” initiative in 2009 and a plan to set a feed-in tariff, bullish forecasts and optimism emerged. But the market didn’t take off like a rocket, causing companies such as Suntech Power to dial back its sales expectations back then.

However, now Suntech, the largest solar manufacturer in China if not the world in terms of production capacity, expects more of its panels to be planted on its home turf than every before — 22 percent of Suntech’s sales in the third quarter of this year came from China. The company previously thought the Chinese market would add 1 GW of solar in 2011, but now it expects 2 GW, according to Andrew Beebe, Suntech’s chief commercial officer, during a conference call to discuss the company’s earnings Tuesday.

China could add 3-4 GW next year, Beebe said. And Suntech’s CEO, Zhengrong Shi, said he wouldn’t be surprised if the figure is over 4 GW. At 4 GW, China would occupy as much as one-fifth of the anticipated global market next year, noted Collins Stewart analyst Dan Ries during the same conference call.

“We are bullish about our position there next year,” Beebe said. Suntech is careful about selecting partners in expanding its domestic market reach and recently teamed up with German developer, Wirsol Solar, to develop projects in the Chinese province of Qinghai, he added.

So what happened? While China ended up structuring the Golden Sun initiative to subsidize part of the cost of installing a solar energy project, what Chinese solar companies really wanted was the feed-in tariff, which refers to solar electricity pricing set to guarantee a good return for solar energy project investors. Feed-in tariffs have made European countries such as Germany and Italy the top solar markets in the world. And it wasn’t until this summer that China finally set that national feed-in tariff.

China has said it wants to install 10 GW of solar by 2015 and 50 MW by 2020.

Chinese companies have been announcing sales and project development deals in the past three years, but with the availability of the feed-in tariff, the development pace and project size are growing. Last week, GCL-Poly Energy said it signed an agreement to deal a 1 GW project with the solar subsidiary of the state-owned China Guangdong Nuclear Power in Shanxi Province.

American companies no doubt hope to carve out a slice of the Chinese market as well, but how quickly they can do so remains to be seen. First Solar signed a memorandum of understanding with the local government in Inner Mongolia in 2009 and was hoping to start construction for the first phase of that project this year. But regulatory approval has taken longer than expected. Plus, the company said it also wanted to wait until China has set a feed-in tariff.

Image courtesy of Matthijs Koster.

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Suntech

Suntech reported third quarter 2011 revenues of $809.8 million, above investor estimates of $776.1 million, but unveiled a loss for the quarter of 64 cents a share, below estimates, for a loss of 26 cents. In addition, Suntech sees shipments for the fourth quarter of 2011 down by 20 percent. However, shares of Suntech rose on the company’s news that its business in Germany is picking up. Suntech is up 6.28 percent to $2.37.

JA Solar

JA Solar reported a third quarter loss of 376 million yuan ($59.1 million), or 2.28 yuan a share, compared with a profit of 513.7 million yuan ($59.7 million), or 3.14 yuan a share, for the same period a year earlier. JA Solar reported revenue of 2.47 billion yuan ($286.9 million) for the third quarter, down from 3.62 billion yuan ($420.5 million) a year earlier. JA Solar also cut its 2011 shipment estimate to 1.6 gigawatts from 1.8 gigawatts.

LDK Solar

LDK Solar reported a third quarter net loss of $114.5 million, or 87 cents an American depositary share, compared with net income of $93.4 million, or 72 cents, for the same quarter a year earlier. LDK had to write down $47.3 million on inventory due to a “significant drop in market price for wafers and modules” during the quarter. LDK reported revenues of $471.9 million, which was a drop from revenues of $675.6 million for the same period a year ago. LDK’s shares are down 1.77 percent to $2.78.

Canadian Solar

Canadian Solar reported strong revenues of $499.6 million, up 32.5 percent from a year ago. But the company lost way more than expected and reported a net loss of $43.9 million, or $1.02 a share, compared with a profit of $20.3 million for the year earlier, or 47 cents a share. Shares of Canadian Solar were up slightly by 2.73 percent to $2.26.

Image courtesy of WxMom.

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India presents an interesting case study for how to architect an emerging solar market. The country seems primed for renewable energy development: it’s got a large and growing population, many of them poor and about 404 million of them have no access to electricity. India also has to figure out how to curb its growing carbon emissions. India’s national government also has promised to install 20 GW of grid-tied solar by 2022 under a program called National Solar Mission.

National Solar Mission is run under a competitive bidding process rather than the price-guarantee model that Germany has made famous. The state of Gujarat offers its own solar subsidy, which is similar to German’s version. But it’s not just the solar incentive programs that are making India so attractive. Some help from the U.S. government also is making a big difference. The Export-Import Bank of the United States announced Friday that it approved financing worth $176.4 million of financing to six solar projects during fiscal 2011.

A policy twist

Several American manufacturers and project developers have been aggressively pursuing sales in India. First Solar began announcing sales agreements for its cadmium-telluride solar panels last December and has since upped its shipment forecast from 100 MW to around 200 MW for 2011. The company sold 10 MW in 2010.

In September, First Solar announced the largest sales deal in India to date: a 100 MW deliveries to Reliance Power. The solar panel maker will ship 40 MW before this year is over and send the remainder 60 MW next year. The company is looking at shipping about 200 MW for at least five projects in 2012, according to estimates by GTM Research.

First Solar has a big advantage that many other solar panels makers don’t have: it’s not subject to a rule that requires project developers in India to use only solar cells made in India. This local content rule applies to projects under the National Solar Mission, which went into effect in 2010 and held its first auction last December. The rule affects only projects that use silicon solar panels, and since First Solar’s panels aren’t made of silicon it’s exempt.

The local content rule not only protects India’s own solar cell makers, it also makes it difficult for manufacturers in neighboring China – the largest solar panel producing country in the world – to compete for projects. China is home to some of the world’s largest silicon solar panel makers, including Suntech Power, Trina Solar and Yingli Green Energy.

Non-Indian silicon solar cell makers can still vie for projects under state solar programs, such as the one in the state of Gujarat. Suntech inked a deal to supply 100 MW of solar panels to SunBorne Energy, with an initial 10 MW going to a project in Gujarat. A 5 MW project in Gujarat was completed last year using Trina’s solar panels.

Winners and their helpers

First Solar’s ability to produce solar panels more cheaply than others is its true advantage because the national solar program seeks competitive bids and selects those who promise to complete projects at lower prices. Manufacturing at a large scale makes it possible to keep solar panel prices low, and at this point, First Solar is the largest non-silicon solar panel maker worldwide and the only one with an army of factories and big sales team.

The only other non-silicon solar manufacturer that is closer in scale to First Solar is Japan-based Solar Frontier, which makes solar panels using copper-indium-gallium-selenide cells. The company recent announced sales agreements totaling roughly 30 MW, which should be installed before the year ends.

Smaller players that make non-silicon panels also could benefit from India’s solar rules.  Abound Solar, a Colorado manufacturer of cadmium-telluride solar panels, has a deal to sell 5 MW to an Indian project developer, which has gotten a loan from the Export-Import Bank of the United States. The Ex-Im bank also has offered loans to Indian buyers of First Solar panels.

And belatedly, the bank announced Friday that it approved, back in August a $84.3 million loan to Dahanu Solar Power to build a 40 MW project in Rajasthan using First Solar’s panels. The same announcement also touted a $18.9 million loan to Tatith Energies to build a 5 MW project in Gujarat using SolarWorld’s panels.

India’s solar programs are only in the early stage of deployment, so it’s too early to say whether India can achieve its solar generation goals. While long-term policy is a nice assurance to solar companies and their investors, it often doesn’t remain static and shifts with changes in ruling parties. But for now, India is enjoying a most-favored status in the solar world.

Photos courtesy of Emmanuel Dyan, hiyori13 and  Ajay Tallam

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