Thin Film PV

Just what is driving Europe's thin film sector? Elizabeth Block looks at a few factors including overcapacity and patriotic financing moves which could be moulding the recovery in Europe.

Just what is driving Europe's thin film sector?

 Elizabeth Block

 looks at a few factors including overcapacity and patriotic financing moves which could be moulding the recovery in Europe.By Elizabeth Block In this "health check" on our sector we have assumed that the current over-capacity in crystalline will eventually diminish and that Europe will recover from the current recession. Our starting point: in June 2009 Greentech Media's senior solar analyst Daniel Englander cast a cold eye on thin film's prospects in Europe. Despite thin film's advantages in terms of cost performance and operational behaviour he saw it as losing out to traditional crystalline silicon PV. Why? While it could be due to the relative performance degradation of thin film compared with c-SI Englander also suggested that there might be patriotic motives in the European finance community. With Germany so strong in c-Si in a climate scarce of risk capital European bankers may want to support the home team. Analyst John-Marc Bunce of Nomura Code in London agrees in part: expectations that thin film would grow rapidly worldwide towards 30% of solar module production by 2012 now look less likely despite the success of First Solar in the US. While cutting his forecast to 25% of total PV installations of ~16.4GW in 2012 Bunce is still bullish because thin film production processes are more easily integrated into high throughput continuous manufacturing and building products solutions and usually produce more energy over a day. Given the long term advantages of thin film technologies Bunce predicts consolidation: "We expect some well established crystalline manufacturers with recovering profitability to take the opportunity to acquire the assets of struggling thin film technology developers." From Ireland David Maguire director BNRG Renewables Ltd points to the well-known over-supply of poly-crystalline: "Many thin film modules are still un-bankable in the current market so they really need to be competitive on price. Thin film would have to achieve savings of 20% against poly-crystalline as it requires significantly more land. "Many investment funds still take the view that thin film carries a risk over crystalline." Renewable energy consultant Jonathan Johns director of Climate Change Matters said that thin film has long been put forward as the natural successor to crystalline PV. However European feed-in tariffs tend to support more conventional technologies. Johns mentions the drop in German feed-in tariffs following similar action in Spain. "This could open the door for thin film in the race to grid parity along with the increasing trend for the corporate sector to generate its own energy. Here capital costs will hold sway with corporates accepting that projects will need to be replaced before the end of their technical life." He added: "As always China will be an increasing factor."

Sub-sectors: is organic the way ahead? In terms of technology sub-sectors keep an eye on organics. Bart Markus general partner and PV specialist at Wellington Partners based in Munich said: "I see 3rd generation PV with potential efficiency similar to CIGS. For example we are investing in Heliatek GmbH a 2006 spin-off from the University of Dresden and Ulm specialising in organic thin film PV. We invested seed money along with others and in November 2009 we led a Series B round which raised 18 million euros for initial production." Bunce disagrees with Englander on Eurocentric reasons for the current surge in crystalline: "It's purely a matter of the market. There's an oversupply now but once we're out of that the picture will change." Hamish Watson CEO of Polysolar Ltd. a maker of organic polymer PV

 said: "Developments within the existing thin film technologies aimed at improving production efficiencies and optimisation of layer structures will only make small incremental improvements on cost per watt. "We must look at overall system efficiencies/costs the electrical system design inverters switches etc." He added: "While this technology currently has low performance the raw material and manufacturing processing costs could be significantly lower than existing thin film technologies. "Improvements in the PV chemicals should widen the spectrum capture pushing up performance levels similar to those of the best thin-film technologies today." Not everyone is going organic. For example at Emerald Technology Ventures in Zurich partner Markus Moor favours flexible modules and invested in Toledo Ohio-based Xunlight three years ago. "We looked at four versions of flexible modules and chose triple junction a-Si. So far the company is doing quite well " he said. Britain's Polysolar is developing transparent PV glazing to address the constraints of OPV materials. Watson said: "We don't seek to optimise the solar spectrum capture as we want a percentage of the light to pass through. Further we print onto and encapsulate directly in glass to address the degradation issues faced by OPV so avoiding the barrier issues faced by reel-to-reel producers." Intellectual property specialist Ilian Iliev co-founder of Cambridge IP also likes the prospect of organics mentioning Konarka Technologies Inc. as well as global companies such as GE DuPont Merck and Japanese electronics companies. Skills gap? Debby Lloyd CEO of EcoSearch in Berkshire UK said: "There is a good international skills base across solar technologies with transferable skills paths.

The wind industry by comparison has major skills shortages emerging and a very limited mindset on cross-sector skills transfer – so solar looks quite positive – especially if a consolidation trend occurs." Moor of Emerald said: "It's not really an issue."