OPPORTUNITIES IN SUN

Study Finds Ample Opportunities In Solar For New Entrants
23 August 2010 (Solar Industry)

"As the burgeoning solar and wind power markets continue to expand, industry value chains are looking to…sustain anticipated growth. For many component producers, the market growth rate will translate into a need to increase existing capacities, build new plants and spread out to new geographies.

"…[M]arkets for certain components of the solar and wind markets will present budding opportunities for new entrants, [according to a new report from Frost & Sullivan,] as growth rates are expected to exceed present manufacturing capacity…"

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"Many European and U.S.-based manufacturers are setting up shop in Asia in order to take advantage of cheaper labor and component prices. In addition, with the number of [Asian] consumers increasing…manufacturers recognize the advantages of placing production locations closer…Both wind turbine and solar module manufacturing facilities have started appearing in low-cost countries such as China, Malaysia, Taiwan and the Philippines."

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"Some components and raw materials require deep technological expertise and extensive production experience in order to produce a competitive product, creating high barriers for new entrants. At the same time, there are other markets in which both experience and expertise can be rapidly gained. Thus, it is potentially easier for new manufacturers to enter or expand into these parts of value chain…

"…[A] key restraint…[may be] the lack of assurance of government financial support. With national budgets overstretched and an increasingly high level of budget deficit in some countries, funding expended to renewable energy markets in Europe and across the globe may not be reliable. Component manufacturers must consider expansions carefully if the government support is reduced dramatically to avoid being faced with overcapacities..."