Independence day for thin film: can it support itself without subsidies?

With the high-profile collapse of Solyndra placing the wider thin film community under scrutiny, PV Insider has been examining how the industry intends to fight back by reducing its costs and develop new innovations.

Although the case of Solyndra is being held up against the thin film industry, the DOE have continued to demonstrate their confidence in the technology. In August this year a $197 million loan guarantee was granted to SoloPower for a manufacturing facility that U.S. Energy Secretary Steven Chu announced would create around 450 permanent jobs and 270 construction jobs. In the same month $967 million was guaranteed to the Agua Caliente Solar project, a 290-megawatt photovoltaic solar generating facility in Yuma County, Arizona that will use thin film solar panels manufactured by First Solar. But in order to build a self-sufficient industry that does not rely on government support, cost reduction is now of paramount importance.

Jean-Noel Poirier, Senior Vice President of Marketing and Business Development at CIGS manufacturer Global Solar Energy, told PV Insider that “political risk is real in the PV business. The changes in feed in tariffs in key markets such as Germany, France and Italy have proven it one more time in 2011. Companies need to have a quick path to ‘grid parity’ without incentives in their targeted segments. In the short term, government incentives favouring innovation are good ways to allow the most advanced future technologies to get to market and raise the bar in the PV industry.”

According to Paula Mints at Navigant Consulting, the US is in an interesting position. “All markets are changing right now, and in the US, the upcoming election year will make it very hard for the incentive climate. Plus, there is real anti-subsidy feeling right now. The US has potential to be a significant market and the competition will be inexpensive c-Si… Unfortunately, and I have said this before, the incentives that the industry relies on are very expensive to support and this makes them inherently unstable.”

But cost reduction is only one half of the picture. Just as important is the drive to innovate, and exploit new opportunities and applications. Mints underlined the link between innovation and survival, explaining that “at this point, innovation in business model is key.” From the manufacturer’s perspective, Poirier explained that “it is critical for thin film players to carve out a space in which they deliver superior value than traditional modules with clearly differentiated products and approaches that are hard to replicate.”

Paula Mints will be discussing how thin film companies can work in an unstable incentives environment at the 4th Thin Film Solar Summit USA (1-2 December, San Francisco). Jean-Noel Poirier will be expanding further on the opportunities open to thin film companies when innovating. To find out more about this event, please visit www.pv-insider.com/thinfilmusa or contact event organizer Matt Carr (matt@pv-insider.com).