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  • International Energy Agency: Photovoltaic International Energy Agency: Photovoltaic Power Systems Power Systems ProgrammeProgramme (IEA PVPS)(IEA PVPS)

    Zacatecas, MexicoZacatecas, Mexico

    Status of the U.S. Segment of the PV IndustryStatus of the U.S. Segment of the PV Industry U.S. Department of EnergyU.S. Department of Energy

    Susannah Pedigo, M.B.ASusannah Pedigo, M.B.A National Renewable Energy LaboratoryNational Renewable Energy Laboratory

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    Available Resource:

    Value of the U.S. solar resource is more pronounced when compared to the solar resource of Germany where PV markets have thrived

    State Priority:

    -21 states implementing RPS/incentive programs to promote solar

    -Most of these states are outside of the Southwest

    -The number of states adopting pro-solar policies is growing!

    Solar Resource:

    States w/ RPS in 2007:

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    • PV Trends in the U.S. Highlights of Business and Policy Activity

    • Investor Perspective: What Does Wall Street Care About? Consensus of PiperJaffray and other institutional investors

    • Solar America Initiative Status Reducing Solar Costs to Grid Parity in All U.S. Markets By 2015

    To Learn More About U.S. Solar Manufacturing and Installation Data, please visit www.iea-pvps.org to download:

    •The PVPS Annual Report

    •The U.S. International Survey Report (Coming in July)

    Overview

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    PV Trends in the U.S. Market

    PV Supply Chain

    • According to CleanTech Venture Network, 2006 cleantech investments totaled $2.9B, a 78% increase over 2005

    • System integrators consolidated in response to pro-solar policies

    • Multi-national strategic alliances & joint ventures forming as a result of poly-Si shortage, e.g., Evergreen, REC & Q-Cells

    • Crystalline PV producers struggled—BP Solar, SCHOTT Solar, & GE struggled to procure poly-Si

    •Nearly all increase in U.S. PV production came from thin film (First Solar)

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    • Policy landscape is changing--more states adopting RPS (21) and local govts are starting to act; additional states have voluntary standards

    -climate change concerns -desire to hedge against volatile energy pricing

    • Codes/Standards & Training/Certification issues getting needed attention by NABCEP, IREC, & states that are adopting pro-solar policies; Solar America Initiative formulating national working groups to tackle…in addition to above reasons…

    -strong desire to diversify economy/job creation -eliminate commercialization barriers

    PV Trends U.S. Policy

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    National:

    • Federal Tax Credit for PV Implemented in 2006 for 2 years; working to extend this to 2016

    California (80% of US Grid-Connected Market)

    •Recently enacted the California Solar Initiative -Goal to create 3,000 MW of new, solar-produced electricity by 2017 -PV incentives starting at $2.50/W for systems up to 1 MW -Performance-based incentive program (>100 kW) high-performing solar projects -$3.2B budget incl. $50M for R&D and $100M for solar thermal

    New Jersey (2nd Largest US Market)

    • 10 MW already installed in 2006; Program over-subscribed and is being revamped; shifting from rebate to market-based system with RECs; NJ looked upon as setting standards for policy

    • RPS requires utilities to obtain 22.5% power from RE by 2021; 2.12% solar set aside

    New York

    • $4.00/W incentive through the Energy $mart Solar Electric System Incentive Program; covers almost 50% of the system price

    PV Trends: U.S. Policy Highlights

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    U.S. Policy Landscape:U.S. Policy Landscape: Regulatory environment is critical Regulatory environment is critical to understanding the market potential for renewable to understanding the market potential for renewable energyenergy

    PV rebate programs are of little value without corresponding net-metering and interconnection standards

    -Net metering establishes frameworks to dictate value of PV & allows system owners to sell back electricity (Economics) -Interconnection standards provide uniformity across a utility service territories & renders the entire process transparent for installers & consumers (Infrastructure)

    PV Trends: U.S. Policy Framework

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    PV Trends: U.S. Policy

    System Size Limit

    External Disconnect Switch

    Additional Insurance Requirement

    Standard Interconnection

    Agreement

    State

    25 kWYesNoNoWashington

    25 kWYesNoYesWyoming

    25 kWNoNone SpecifiedNo Oregon

    20 MWNoNoNoNevada

    10 kWVaries by utilityNoYesFlorida

    NoneYesNoYesPennsylvania

    25 MWYesYesYesConnecticut

    NoneYesNoYesHawaii

    10 MWNoNoYesColorado

    10 MWYesNone SpecifiedYesTexas

    NoneYes, at util. discretionNoYesMassachusetts

    2 MWYesNoYesNew York

    VariesNoVaries by UtilityNo, varies by UtilArizona

    2 MWNoNoYesNew Jersey

    10 MWFor systems> 1 kWNo YesCalifornia

    Source: “Smart Regulation Speeds Growth,” PV News, Oct 2006

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    Why Are Investors Interested in Solar?

    • Best growth sub-sector of Technology • Unlimited future growth at grid parity • Trend toward socially responsible investing • Best performing stock sector within technology • Compelling long-term themes of alternative energy Source: Piper Jaffray, “What Does Wall Street

    Think About Solar,” March 2007

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    What Concerns Investors?

    • Economic jitters • Is this a solar bubble? • Dependence on subsidies • Supply chain friction • Who has better business model?

    -poly >wafer>cell>module>integrator -poly-based vs. thin-film -horizontal vs. vertical integration

    Source: Piper Jaffray, “What Does Wall Street Think About Solar,” March 2007

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    Investor Perspective: Poly-Silicon Issue

    Watching Poly-Si supply issue closely: • short-term: benefits to investing (’07-’09) • mid-term: poly-Si glut? (’09-’11) • long-term: grid parity; buy low-cost, hi-volume

    producers & next-gen technology (’11-’13+)

    Source: Piper Jaffray, “What Does Wall Street Think About Solar,” March 2007

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    Investor Perspective: Themes to Watch

    • Theme 1: Cautious on Poly-Si Supply • Theme 2: Looking for Lowest Cost; Who is

    ‘Samsung’ of Solar? • Theme 3: Looming Margin Compression

    Source: Piper Jaffray, “What Does Wall Street Think About Solar,” March 2007

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    Investor Perspective: Industry Risk

    • Reduction or elimination of government subsidies: would significantly reduce demand for solar

    • Poly-Si Shortage: lack of poly may limit the growth of the solar industry

    • Interest Rate Risk: increases in interest rates may put solar installation projects on hold

    • Geopolitical & country specific risk: the industry is largely concentrated in 4 countries. Geopolitical events could have material adverse effect on the industry

    Source: Piper Jaffray, “What Does Wall Street Think About Solar,” March 2007

  • The Solar America InitiativeThe Solar America Initiative

  • International Energy Agency Photovoltaic Power Systems Programme

    www.iea-pvps.org

    SAI Strategy in Brief Reducing Solar Costs to Grid Parity in All U.S. Markets By 2015

    SAI Photovoltaic (PV) R&D activities will emphasize technologies with the greatest potential for cost reductions to meet SAI goals. SAI will also continue current efforts on CSP systems R&D.

    To accelerate attainment of systems goals, SAI will employ public-private partnerships to pursue component and system technologies and demonstrate manufacturing approaches that deliver low-cost, high-reliability commercial products.

    The Solar America Initiative (SAI)

    Partnership members will market and distribute PV systems developed under SAI, while SAI market transformation efforts tackle non-R&D barriers to market penetration for both PV systems and CSP technologies.

    Tech Pathway Partnerships & Market Transformation: Knowledge Transfer • Partnership • Collaboration

  • International Energy Agency Photovoltaic P

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