Thin film: Potential remains for those who survive

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Strategies to survive the challenges presented by the current period of intense price competition have been one of the focuses of the Thin-Film Industry Forum, currently underway in Berlin, Germany. On day two of the Solarpraxis-organized conference, industry representatives have heard how the potential for cost reductions to deliver sub-50 euro cents-per-Watt (c/Wp) remains, for those that can survive the current period of intense competition from crystalline silicon (c-Si) rivals.

Presenting on the second morning of the conference, Henning Wicht from IHS iSuppli made the observation that rapidly falling polysilicon prices have brought about cost reductions within the c-Si industry. As such, he observed that producers like Canadian Solar have been able to bring costs down at a far faster rate than such thin film companies as cadmium telluride (CdTe) producer, First Solar. The U.S. company is seeing its "cost advantage about to be overcome," concluded Wicht.

Thin film’s lower efficiencies, when compared to c-Si modules, amplifies the implications of approaching cost parity between the two technologies, continued Wicht. Because of lower efficiencies, balance of system (BOS) costs remain higher for thin film installations – more mounting systems, cabling, etc. are needed for the same output – and, as such, thin film modules must be sold below the price of a c-Si module. With c-Si module prices predicted by IHS iSuppli to be below US$0.80/Wp for Chinese manufacturers selling into Europe in 2012, for thin film producers to do so profitably at present is a significant challenge.

Wicht continued that First Solar’s recent announcement to close it operations in Frankfurt (Oder) would have a negative impact on thin film’s place in the photovoltaic market globally. Wicht pointed to a global thin film production of 5.5 gigawatts (GW), which means that the roughly 550 megawatts (MW) of production that will be lost through the German fab closures will represent a decrease of market share for thin film.

Technical possibilities

The present market conditions presents further challenges for thin film producers, as the ability to carry out crucial R&D is also undermined when modules are being sold at, or below, cost. Asking a question of thin film researcher Rutger Schlatmann, Gotz Fischbeck from Smart Solar Consulting inquired as to whether R&D budgets are being cut.

Schlatmann replied that large corporations, or producers with the backing of larger parent companies, are still able to invest in the technology. He added, "Even very long-term research is being done by equipment companies, who see an opportunity to develop new technology."

Fischbeck continued the line of inquiry, questioning whether public funds are also still available for research programs in photovoltaics, given the recent fab closures and insolvencies in Germany. "There are contrary signals," answered the researcher Schlatmann. While regional governments appear more ready to provide funds in those areas where manufacturers exist, he said, on a federal level, things are unsure. He added that research bodies will be meeting with Federal Government Ministries to discuss this in the coming weeks.

CIGS prospects

However not all was "doom and gloom" at the conference and Steffen Schuler, from Picon Solar, held a presentation in which the potential for CIGS (copper-indium-gallium-diselenide) manufacturers in Europe to achieve cost-per-Watt of sub-50 euro cents was set out as still being possible in the near future.

In the audience, Franz Karg from German CIGS manufacturer, Avancis concurred. "We are in a position to implement the cost savings spoken about," said Schuler. He continued that Avancis has the added benefit of being able to work with parent company Saint Gobain on techniques to optimize the glass used for the modules and the cost of the glass itself.

During Schuler’s presentation it had been explained that glass supply has the potential to deliver cost-per-Watt savings.

The Thin-Film Industry Forum will conclude later today.