x Abu Dhabi, UAEMonday 22 January 2018

Ray of hope is forecast for solar panel makers

Sunshine is forecast for many solar technology companies as a worldwide glut of photovoltaic panels subsides.

Sunshine is forecast for many solar technology companies as a worldwide glut of photovoltaic panels subsides. As expected, Germany's government on Wednesday agreed to cut subsidies for most new solar installations in the world's leading consumer of electricity generated from sunlight. But the move has boosted earnings for panel manufacturers in the short term.

That is because the expected cuts have accelerated German solar projects, even as production costs have continued to fall. Chinese solar companies such as Suntech Power and Yingli Green Energy would post improved quarterly results, the brokerage company Lazard Capital Markets predicted. "We expect strong fourth-quarter 2009 earnings across our coverage universe, driven by potential for higher shipments resulting from the demand pull in Germany, along with modestly lower pricing and declining silicon costs," Sanjay Shrestha, an alternative energy analyst with Lazard Capital Markets, wrote this week in a research note.

Canadian Solar, a Chinese company despite its name, swung to a fourth-quarter profit and posted record sales, it announced on Wednesday. New products have helped the company increase its worldwide market share. It predicted "very strong" growth this year. Longer term, a British government programme aimed at boosting the share of UK electricity generated from renewable energy to 30 per cent by 2020, from 5.5 per cent, could ease the sting of lower German subsidies.

Starting in April, the British government will reward homeowners who produce their own electricity with guaranteed above-market power prices known as feed-in tariffs. Britain's solar industry could expand rapidly, said Andrew Lee, the head of the UK solar division of the Japanese electronics maker Sharp. "The wonderful news of the feed-in tariff is it will do a lot for the UK industry," he said. "If, as predicted, we continue to grow, obviously we'll be looking at further investment."

Sharp makes about 25 per cent of all solar panels installed globally and is considering expanding its European operations. "The UK market will now become a very important player," Mr Lee said. "Now we have the possibility of becoming a leader." The recession sharply cut demand for solar panels last year, affecting manufacturers around the globe. @Email:tcarlisle@thenational.ae