Dr. Robert Castellano on how to make solar a ‘hot’ sector again – 2

This is the concluding part of my conversation with Dr. Robert N. Castellano, president of The Information Network, based in New Tripoli, USA.

The question of adding new, additional solar capacity will always arise. Is t certain that no new additional capacity will be brought on board in 2009? Dr. Castellano said: "Actually I said 2010. Solar manufacturers are already losing money this year and the capacity utilization is 27.9 percent. Also, the days of inventory are currently 122, up from 71 days in 2008. If they continue to add new capacity, things will only worsen, exasperating the recession."

Lessons for India?
Turning our attention to India, which has lately been witnessing a lot of talks of building new capacity. According to Dr. Castellano, now is a good time to talk, as a plant will take at least a year to get into full production. By that time, prices should be stabilized and increase.

What then are the lessons to learn from all of this for the Indian solar PV industry?
He added: "What has to be weighed is the cost of making the solar panels in India versus buying the outside the country. It can take several years for a plant to be profitable. If the venture was established from money from India’s government through subsidies, it can lessen the impact of potential losses, while the plants ramp and selling prices move up to a level where production becomes profitable."

I hope this valuable piece of advice is noted by the existing players or those looking to entering the solar photovoltaics segment in India.

Bring down solar production cost per watt
Dr. Castellano had mentioned about First Solar bringing production costs down to $0.93 per watt. How many of the others are capable of matching or bettering this?

He said, for that matter, Oerlikon, expects that its lines will deliver a cost of $0.70 cents per watt by the end of 2010 and has achieved an initial conversion efficiency of 11 percent, which comes out to about 9.5 percent of stabilized efficiency.

How can manufacturers differentiate their solar products?
Another query has been, how should solar manufacturers differentiate their products and how can they do it cheaply?

Certainly, there are new avenues of manufacturing, such as CdTe from First Solar, CIGS from half a dozen manufacturers, multi-junction cells from companies such as Uni-Solar, and building integrated photovoltaics (BIPV) from an increasing number of manufacturers, advised Dr. Castellano.

He said: "These technologies differentiate the companies’ products, but the proportion of wattage manufactured, while growing, is small compared to the majority of solar panels sold using traditional methods of production, i.e., a thin film on a glass substrate.

"Long life and low cost of ownership are of paramount importance if solar is to grow, particularly, if there is to be a large acceptance at the residential level. Manufacturing can introduce defects in solar cells that can result in low electron mobility (EM), electron traps and photo-degradation from UV light. These issues affect the efficiency and lifetime of solar cells and the importance of measuring electron mobility at the wafer and cell stage.

"The lifetime of minority carriers has been widely identified to be the key material parameter determining the conversion efficiency of pn-junctions in silicon solar cells. Defects in the crystal lattice reduce the charge carrier lifetime and thus limit the performance of the solar cells. Another major efficiency loss is due to impurities in the cell.

"These can be foreign atoms or molecules in the crystal lattice (including the dopant atoms), and provide sites where electrons and holes can recombine, thereby reducing the number of charged particles available to create an electrical current.

"Lehighton Electronics (Lehighton, PA) is an example of a company that has developed a variety of tools to test and measure solar wafers. One tool can measure sheet resistance and resistivity to see if there is any subsurface damage. Another system can measure minority carrier lifetimes, while a third model can find traps in solar wafers."

How to make solar hot (all over again!)?
Finally, isn't solar hot enough ? What would really make it hot (all over again)?

According to Dr Castellano, oil is now $70 a barrel [around August 23, 2009] and rising, which, to him suggests that people will start rethinking alternative energy. However, the second point about the credit market crunch remains. Who can get a loan to build a solar plant anyway? That will change once the recession is over.

He added: "Spain has not resumed its incentive program and will subsidize just 500 megawatts of solar projects this year, down sharply from 2,400 megawatts in 2008. Mainland China’s stimulus and now Taiwan’s incentives (we suspect money coming in from Mainland China) will counter the downturn in Spain and Germany.

"In the past six months we have seen somewhat of a stabilization in the worldwide economies and the share prices of solar companies ramp in recent weeks.

The passage of stimulus bills around the world will provide a ray of hope for the industry. In the US, for example, the new Stimulus Bill of 2009 changes the rules on how investment tax credits are awarded, allowing companies that are building power plants to take 30 percent of the cost as a tax break in a project's first year. This could prove vital because, in the last quarter of 2008, 10 out of 14 tax-equity providers stopped doing business in the solar market."

On SolarPA
Unknown to many in this part of the world, Dr Castellano started SolarPA, a few months ago. Providing more details, he said: "SolarPA, a company I started a few months ago, has demonstrated increases in efficiency of polycrystalline and silicon solar cells by up to 10 percent using a proprietary nanomaterial coating. Increasing the efficiency by 10 percent will automatically increase a 50MW production line to 55MW, reducing material and labor costs.

"We are looking for funding and I have been in talks with solar material and equipment manufacturers to partner for further development. We have NDAs with Applied Materials, Air Products, and Baker Mallinkdrodt, and are expecting them from Oerlikon and Ferro. These companies would develop the technology and then our joint partnership would license it to the solar manufacturers.

"Another possibility is to get investor money to develop the technology in-house, eliminating the need for the middlemen above. 1366 Technologies, for example, is developing a technology that it claims can boost multicrystalline silicon cells from 16 percent efficiency to 18 percent efficiency, thereby reducing their cost per watt, by giving the solar cells a rougher texture. The startup raised $12.4 million in 2008.

"Xerocoat developed a coating strategy that increases efficiency by 4 percent on not only a multicrystalline silicon cell but thin film cells as well. The company received $3 million in DOE funding in 2009.

To be concluded

Dr. Robert Castellano on how to make solar a'hot' sector again - 1

Last week, I was very fortunate enough to be able to get into a conversation with Dr. Robert N. Castellano, president of The Information Network, based in New Tripoli, USA. It all started with a column, which he writes regularly in “The Street.” One of the recent colums of Dr. Castellano touched upon –- What could make solar hot again?

This first part will touch upon issues such as six reasons for cloudy solar skies and how to rectify the current oversupply situation in solar cell manufacturing, status of a-Si solar cell makers, crystalline vs. thin film capacity, and impact of prices.

How to rectify the solar cell oversupply?
As I'd asked iSuppli too, in one of my recent posts, I also quizzed Dr. Castellano on whether the previously committed capacity expansions have caused solar cell manufacturing oversupply? Also, why had this happened and how could this be corrected?

He said: “The problem will rectify itself when demand catches up with supply, which will take several years. Until then, suppliers are faced with lower prices and margins. I was the first to point out on March 5 2008, in my blog on Seeking Alpha in an article entitled “Contradictions in the Solar Industry” that “The solar industry is faced with a huge oversupply of solar panels planned for production in 2008, but no one seems to notice… or care. Shares in many solar companies such as Evergreen Solar), First Solar SunPower, and Suntech Power have surged with the booming solar market.”

Six reasons for cloudy solar skies
He added: “On November 18, 2008, in another blog on Seeking Alpha entitled “Six Reasons for Cloudy Skies on the Solar Energy Industry” that the problems in the solar industry were the result of the following:

1. With oil at $60 a barrel, who cares about alternative energy? It is a short sighted view, but with the credit market crunch, who can get a loan to build solar plants anyway?”

2. The high price of oil in the past year was a catalyst for the development in other alternative energy sources, and not just solar! Advances in wind, geothermal and hydropower energy are reducing the cost of wind power to a point at which it is becoming competitive with traditional energy sources. Nuclear power plants -- smaller than a garden shed and able to power 20,000 homes -- will be on sale within five years, say scientists at Los Alamos, the US government laboratory, which developed the first atomic bomb. Among these alternative energy sources, hydropower and nuclear have the lowest carbon footprints (carbon dioxide produced during operation).

3. Spain, a huge buyer of solar, reduced its incentive program to aid buyers in 2009. In California, a seemingly green state, Prop. 7 was defeated in the November election with a whopping 65 percent of the voters saying NO. One reason: electricity consumers would pay 10 percent above the market rates for renewable power forever.

4. The spot market price of six-inch solar-grade wafers have fallen to $9 from a high of $12.50 in September. This bodes poorly for thin film makers and equipment suppliers. The thin film solar panel market and hence, the equipment market grew strongly because of the shortage of polysilicon. Now that polysilicon is abundant and lower priced, why make thin film panels with 8 percent efficiency when you get 16+ percent efficiency with silicon wafers?

5. “Utilization is at only 56 percent. Our analysis of 103 solar manufacturers shows that panel production capacity in 2009 will be 15 GW whereas only 8.3 GW will be sold.

6. The dollar has appreciated strongly against the euro by nearly 25 percent. Germany is the world's largest PV market. US solar companies have had to adjust selling prices to generate sales, reducing profit margins.”

Have companies been overlooking inventory problems?
In this context, weren't the solar companies doing enough to check all of these during the downturn of Q4-08? Even the 71 days to 122 days excess supply or inventory is huge!

Dr. Castellano said: “The solar companies were benefiting from the low price of polysilicon as a result of excess inventory in that sector. They were renegotiating contract prices with the poly suppliers and dropping prices. With money in place, they continued to build capacity well into 2009. All the factors discussed above took everyone by surprise (witness the stock market crash) and the recession has lasted much longer than initially forecast.

Where does this place a-Si solar cell makers?
How is all of this potentially setting the stage for the failure of multiple cell manufacturers, particularly those pursuing a-Si thin film solar cells?

He added that thin film cells are still less expensive to make and companies are working to improve their efficiency. Also, they appear to work at stated efficiency under lower incident light conditions.

“The issue is the economics in a solar farm where they are installed. The installation price is the same as a polycrystalline panel. Since the efficiency is lower and it takes more panels to reach the same wattage as polycrystalline, it also takes more hook-ups and frames during installation.

“If the panels move, there is another factor in the motors to move them. However, the production cost is lower than the polycrystalline panels. Oerlikon, expects its lines will deliver a cost of 70 cents per watt by the end of 2010 and has achieved an initial conversion efficiency of 11 percent, which comes out to about 9.5 percent of stabilized efficiency.”

Crystalline vs. thin film capacity
There is still a huge amount of solar cell manufacturing capacity in crystalline silicon solar cell, rather than thin film. Are there any chances of that starting to change any time soon?

Dr. Castellano said: “Until last year, Germany had been the world's largest solar market thanks to its feed-in tariffs, which require utilities to buy all the solar energy produced at premium, government-set prices. As a result, analysts now expect Germany, which doesn't have an annual cap like the one in Spain, to become the biggest market again in 2009.Germany installed 1.35 gigawatts of solar energy systems in 2008, and it could add another 1.5 gigawatts in 2009.

“Spain took the lead last year, but the government has since reduced the subsidies and capped the amount of energy that could be sold under the subsidy program. The financial market crisis has made it difficult for developers to line up financing for solar power projects. Spain, which added a few gigawatts of solar in 2008 alone, now has a 500-megawatt cap for 2009. All of these forces have led to an oversupply of silicon panels.

“As governments -- Germany and Spain were a driving force – in the solar industry’s run-up, they were a factor in the downturn. Once the recession is over and liquidity returns, they will mitigate the overcapacity, particularly as prices are so low and there is pent-up demand for new installations.”

Impact of Q4 on overall prices and industry
Another aspect worth examining is the overall impact of this (Q4) on overall prices and the industry.

Dr. Castellano said that silicon used to sell for more than $300 per kilogram on the spot market and $150 per kilogram for long-term contracts a few years ago. Silicon prices have since fallen significantly over the past year. In fact, the long-term contract price has dropped about 50 percent, close to the spot market price of $67 per kilogram, or about $0.50 per watt.

“Polysilicon panels are selling at $2.25 to $2.50 per watt from $4.17 in Q2 2008. We expect prices to decline further throughout the remainder of the year,” he noted.

In part 2 of this conversation, I will be discussing additional capacity in solar, new capacity in India, and of course, lessons to learn for the Indian solar industry. Watch this space, folks!

EU Commission supports ersol Group investments at Arnstadt site

ERFURT, BRUSSELS: ersol Solar Energy AG (ersol) recently received the anticipated approval of EU Commission subsidies towards investments in the crystalline sector.

The Free State of Thuringia and the Federal Republic of Germany had already accepted this support subject to the approval of the European Commission. With an investment volume of € 530 million ersol will be expanding the factory site at Arnstadt as planned.

This will include the expansion of the nominal capacity in the solar cells sector to 630 MWp over the next few years, together with the establishment of its own module production capacities. The grants now approved will cover more than 10 percent of the overall investment and are a fixed element of the investment planning. The expansion is to be financed with Bosch Group loans and internal ersol funds.

“We are delighted about the approval of subsidies from the European Union. This will enable us to invest over half a billion euros at our Arnstadt manufacturing facility in the next few years. We would like to thank in particular the respective Departments of Trade and Industry of the Free State of Thuringia and the Federation, who lobbied for this important support,” said Holger von Hebel, CEO of ersol Solar Energy AG upon hearing the positive news from Brussels.

Winners and losers in crystalline silicon PV

USA: An influx of new entrants, combined with dramatic capacity expansions from established manufacturers, has meant that crystalline silicon-based PV has become an increasingly crowded and commoditized space over the last two years.

Add to that a recession-driven demand slump and an expected thin-film ramp over the coming years, and there is little doubt that competition in this segment will be extremely fierce.

Building off the insights and findings in GTM Research’s ground-breaking reports PV Technology, Production and Cost and Global PV Demand Analysis and Forecast, this report will take a closer look at crystalline silicon-based business models, detailing what it will take for a cell/module manufacturer to succeed over what is widely expected to be a challenging time for the industry.

The report dives deeper into 50 prominent crystalline silicon-based manufacturers in the market and conducts a comparative analysis over a range of key metrics, extracting conclusions pertaining both to individual companies and business models. Along the way, it details a wide range of company-specific data that allows a crystalline silicon-based manufacturer to accurately assess its competitive position in relation to its peers.

Key Insights

* In the wake of rapidly falling ASPs, a superior cost structure is critical for a successful manufacturing business model, especially for a firm that lacks downstream access. In-house polysilicon production capabilities still confer a material cost advantage, and can offset high conversion costs.

At the same time, the fact that spot prices are down to around $100/kg today means that companies at large scale or that have production facilities in low-cost locations (China, Taiwan, other Asian countries) can make up for higher blended polysilicon prices through a lower non-silicon cost.

* A large majority of producible cell supply in 2009 to 2010 comes in between $1.35 to $1.75/W, and most module supplies will be produced in the range of $1.80 to $2.20/W.

* Next to a competitive cost structure, a strong balance sheet is the most important metric in determining a company’s fate over the course of the impending shakeout. Amongst the public firms, JA Solar, Solarworld, Kyocera, Ersol and Delsolar have the healthiest balance sheets when taking into account current cash reserves, near-term debt repayments, estimated cash inflows and capital expenditures.

* Based on the dynamics of polysilicon spot and contract pricing from 2006 to 2008, producers can be grouped into one of three categories: (i) well-capitalized and established firms that were able to secure long-term contracts with incumbent poly producers in 2006 to 2007, and will remain relatively unaffected by the spate of recent and upcoming perturbations in the spot market; (ii) firms that have a low contracted position coming into 2009, and will be able to take advantage of the relatively cheap polysilicon on offer in the spot market; (iii) companies that entered into long-term contracts past 2006 that signed with lower tier, higher marginal-cost players, and could find themselves in the unfortunate position of being locked into contract prices higher than current spot levels.

* Given significant oversupply at the components level, downstream access has emerged as the most crucial aspect of a cell/module manufacturer’s vertical integration strategy. Downstream integration is especially important for firms that do not have a low-cost business model.

* Business model strengths exhibit a marked bifurcation along regional lines: China and Taiwan-based companies have a definite edge when it comes to processing costs while American and European firms have superior brand recognition, downstream access and proximity to end-demand. An approach that would merge these strengths would be for a US/Europe-based manufacturer with a strong brand to outsource cell and/or module production to a low-cost Asian manufacturer, and brand, market, sell and deploy modules under its own name. Subject to the success of first movers (BP Solar, Evergreen Solar), there is a high probability that more companies will adopt this model in coming years.

This report is available for Single License: $995, and Enterprise License: $1790, from GTM Research.

Strategies for gaining share in the solar market (Part II)

NEW TRIPOLI, USA: Solar cell manufacturers must differentiate themselves during the slowdown in the solar cell market, according to a report: Opportunities in The Solar Market For Crystalline and Thin Film Solar Cells, recently published by The Information Network.

We wrote in Part I how solar manufacturers can differentiate their products, particularly during the economic slowdown.

We discussed increasing efficiency. For example, a local company (contact us for details) has developed a coating for amorphous and polycrystalline cells that can improve efficiency between 8 percent and 12 percent using non-vacuum techniques so that the cost is in the cents per watt range.

Tunable refractive indices make these materials excellent candidates for improving both thermal conductivity and absorption bandwidths. When these unique, novel coatings are coupled with nano-enhanced polymeric coatings, significantly improved durability and extended product life can be anticipated. UV resistance, resistance to optical crazing, and the effect of adverse weather and temperature conditions is also predicted. Films can be coated on any surface.

The other strategy for gaining share, which was mentioned in Part 1 and is discussed here, is to improve reliability:

Long life and low cost of ownership are of paramount importance if solar is to grow, particularly if there is to be a large acceptance at the residential level.

Manufacturing can introduce defects in solar cells that can result in low electron mobility (EM), electron traps and photo-degradation from UV light. These issues affect the efficiency and lifetime of solar cells and the importance of measuring electron mobility at the wafer and cell stage.

The lifetime of minority carriers has been widely identified to be the key material parameter determining the conversion efficiency of pn-junctions in silicon solar cells. Defects in the crystal lattice reduce the charge carrier lifetime and thus limit the performance of the solar cells.

Another major efficiency loss is due to impurities in the cell. These can be foreign atoms or molecules in the crystal lattice (including the dopant atoms), and provide sites where electrons and holes can recombine, thereby reducing the number of charged particles available to create an electrical current.

Lehighton Electronics (Lehighton, PA) is an example of a company that has developed a variety of tools to test and measure solar wafers. One tool can measure sheet resistance and resistivity to see if there is any subsurface damage. Another system can measure minority carrier lifetimes, while a third model can find traps in solar wafers.

Manufacturers and buyers of silicon wafers can benefit from knowledge about the quality of the product. Manufacturers can adjust growing parameters to minimize defect and impurity problems and buyers can evaluate product before going to the expense of turning them into solar cells.

Comprehensive report on TFPV and batteries 2009-2029

DUBLIN, IRELAND: Research and Markets has announced the addition of the "Thin Film Photovoltaics and Batteries 2009-2029" report to its offering.

This comprehensive report, updated and revised in March 2009 to take into account the global economic situation, gives a thorough analysis of printed and thin film photovoltaics and batteries, with 10 year forecasts to 2019. Included are detailed profiles of 48 companies working on the many different types of technologies.

The report covers companies, research institutes and universities that are active in developing and commercializing thin film technologies for photovoltaics and batteries. Photovoltaic technologies covered include CIGS, CdTe, DSSC, a-Si and organic photovoltaics. Learn how these technologies (each at a different stage of development and adoption) are driven forward by both government and leading companies in the field.

The report also describes materials (both organic and inorganic) and device structures as well as various high-speed printing technologies employed.

IDTechEx find that the market for thin film inorganic photovoltaic technologies beyond crystalline silicon will reach at least $20 billion in 2014. The global solar energy market is expected to reach $34 billion in 2010 and $100 billion in 2050 and most of that latter figure is expected to be achieved by non-silicon photovoltaics.

This report provides a comprehensive list of key companies that are active in each of the TFPV and battery technologies. Compiled and analyzed by Dr Harry Zervos, technology analyst with IDTechEx, company profiles are given along with 20 year forecasts for the growth of the market share of these technologies. Dr Bruce Kahn, consultant and academic, gives a thorough analysis of the science and technology behind thin film photovoltaics and batteries, as well as a comparison of different high-speed printing techniques.

New technologies emerging
Silicon photocells are seen in many places, but the technology is limited. Crystalline silicon will never give tightly rollable devices let alone transparent ones or even low cost power generation on flexible substrates.

Fortunately there are many new alternatives. Proprietary nano-particle silicon printing processes are developed by companies such as Innovalight and Kovio and it promises many of the photovoltaic features that conventional silicon can never achieve. It can be printed reel to reel on stainless steel or other high temperature substrates.

However, most of the work on the next generation of photovoltaics is directed at printing onto low cost flexible polymer film and ultimately on common packaging materials.

Several companies, universities and research institutes are hard at work in different development stages of these technologies with large scale plants being built across the globe.

Solar energy: A bright spot in renewables

MENLO PARK, USA: Solar energy is gaining market share, as interesting new technologies are being developed to drive this renewable energy source forward.

The oil price fluctuations and global warming concerns have sparked a concentrated interest in promoting solar energy applications. In fact, the outlook for the global solar energy market is projected to more than double to reach $70 billion by 2013.

SRI Consulting (SRIC) has published its new Materials and Technologies for Solar Energy report that details the solar materials and technologies used in 1st through 4th generation photovoltaic applications, including an overview of solar thermal.

Solar power, like so many new energy processes, makes demands of chemicals during equipment manufacturing or operations. The 1st and 2nd generation photovoltaic cells require different forms of silicon, rare transition metals and metalloid elements. As a result of increased silicon costs, the 3rd and 4th generation technologies are focusing on organic polymers or nanomaterials and the lower manufacturing costs they offer.

Bob Davenport, Director of the Safe and Sustainable Chemicals series at SRIC said: "Developments in organic photovoltaic technology have made significant improvements in recent years, with cell efficiencies reaching over 5 percent. However, silicon based cells in the commercial photovoltaic industry are still the predominant technology because of higher efficiencies reaching over 25 percent."

The Materials and Technologies for Solar Energy report explores new applications where solar energy is being applied. Many opportunities exist for companies in the solar energy area from material research to manufacturing where breakthrough developments are being made at a surprising rate. The developments in organic manufacturing pose promising synergies with the printed electronics industry.

The number of specific technologies for producing photovoltaic solar cells is almost as numerous as the number of companies participating in the industry, especially with newer generation technologies. In addition, manufacturers are coming together and establishing standards. The Materials and Technologies for Solar Energy report includes information on key manufacturers and major technologies.

Why solar/PV is good for India? An ISA perspective!

Recently, the India Semiconductor Association (ISA) held an educative briefing session on the potential of the solar PV market in India, which was conducted by Rajiv Jain, Director, Government Relations, ISA.

This meeting was held well before iSuppli issued a warning that there could be global solar sunburn in 2009! I am sincerely hoping that most of the points mentioned by ISA's Jain still hold good in the coming year, and that India really does well and takes off in solar photovoltaics.

The ISA's vision: To help make India an attractive global destination for PV manufacturing and a world leader in solar energy.

Starting with the basics of photovoltaics, he said that it is a package of solar cells used to convert energy from sun to electricity. In simpler words, photons from sunlight knock electrons into higher state of energy, thus creating electricity. The electricity can be used to power equipment or recharge a battery. A typical PV system mainly consists of a PV module, battery, inverter, controller and junction box.

Focusing on the technological landscape, he touched upon the two key technologies for solar: crystalline and thin film.

Crystalline silicon is said to be the most mature Si wafer technology, with the largest market share. Though, high on cost, it has a typical efficieny of 14-18 percent. Crystalline silicon is said to suitable for rooftop applications.

Thin film is nothing but thin layers of photosensitive materials on glass. It is currently on high growth due to silicon shortage, and very low on cost due to low material consumption. The efficiency is about 6.5-8 percent.

A third technology, nanotechnology, is the future technology for cost reduction. It is more in the R&D space as of now.

Present scenario for solar
So what's the present scenario? In 2007, of $71 billion invested in new renewable energy (RE) capacity globally, 30 percent was in solar PV. It is the fastest growing area in the energy sector, with a CAGR of 47 percent over the last five years.

Grid-connected solar PV has been high growth market segment in 2007 (50 percent increase). Also, 86 percent of the PV installations are largely in four countries, with Germany at 47 percent being the outright leader.

Market drivers are said to be attractive feed-in tariffs, national PV market development and acceptance, RE obligations through solar PV, access to cheaper mode of finance, manufacturing incentives as well as strong R&D.

Why solar for India
I have addressed this in an earlier blog post. Here's what Jain had to say, and it is mostly in line with the earlier discussions.

First, India has among the highest solar irradiance globally. It also has the best quality reserves of silica in Orissa and Andhra Pradesh. India has also established itself low cost producer and assembler of solar PV cells and modules.

The major challenges include attaining scale and integration for cost reduction, and, R&D for development of the industry.

Solar insolation in India
To start with, the daily average solar energy incident varies from 4-7kWh per m2. Next, we have multiple sites with solar irradiation >2000 hours per year. In contrast, Germany has 900-1,200 hours per year. Further, most parts of India have 300-300 sunny days in a year translating into a potential of 600GW. Also, potential in some states like Rajasthan is 35-40 MW per m2.

It is well known that the Indian semiconductor policy of 2007 has triggered off the now well publicized efforts in solar initiatives. The government of India has received 16 applications with investments envisaged at app Rs. 1,55,000 crores.

The investments in solar PV manufacturing exceed Rs 1,25,000 crores. Generation based incentives (GBI) are going to be key.

Potential market segments in India
There are quite a few, actually. In rural electrification, the government of India's target is to achieve 'Electricity for all by 2012'. About 18,000 remote villages will likely be electrified through RE. About ~25 percent of the remote villages, i.e., 4,500 villages, form a very viable market.

Next comes telecom back-up power! PV is a cost effective alternative to diesel generators (DG) for back up power for shorter duration, as DG based systems suffer from several disadvantages.

Another key market could be grid connected solar PV based generation. Current tariffs do not provide attractive IRR to developers. Decreasing system prices are however, likely to improve the economics.

Finally, roof based BIPV is said to be an alternative to reduce the cost of power procured by commercial buildings.

ISA's recommendations
The ISA has also made salient recommendations via its report on the industry. These include areas such as manufacturing: with an aim to encourage companies investing in 'Scale and integration', provision of capital subsidy to larger number of units, availability of funds at a cheaper rate, and an emphasis on R&D.

Also, the ISA has recommended that GBI be given for a tenure of 20 years, with the present period being 10 years. Further, it has suggested an accelerated depreciation along with the GBI scheme, and the availability of GBI for an unlimited capacity for a period of five years. The ISA has recommended an enactment of the RE Law requiring utilities to progressively increase power purchase from RE.

On its part, the ISA has been working with the government of India and various state governments as well. It has a sound rapport with concerned ministries - MNRE, DIT and NMCC.

The ISA has also assisted in the technical evaluation of solar PV proposals received in Fab City, Hyderabad. It has also drafted a semiconductor policy for the government of Karnataka, which should be out early next year, hopefully. The ISA is also working with several other state governments to promote the industry in their states.

The second ISA Solar PV Conclave is scheduled for November 2009 at Hyderabad.

Very good intentions, all of these! Now, for the Indian industry and the government to deliver, and walk hand in hand!!