Suntech Power, the large Chinese solar panel maker that filed for bankruptcy last month, isn’t the only solar company teetering on the edge. Almost all of the world’s largest solar panel makers are in danger of going bankrupt within a year, and the downturn is having an impact on innovation.
New solar cell technologies developed at these companies and at startups are stuck on the shelf or in low-volume production while manufacturers put off buying new equipment to make new kinds of solar cells. These companies are focused instead on finding ways to reduce installation costs and making incremental improvements to increase power output of conventional, now commoditized, solar technology.
Incremental improvements to solar cell design and manufacturing, along with an oversupply of solar panels, have lowered solar panel prices to the point that they are now a relatively small part of the total cost of solar power. The cost of installation, “balance of systems” equipment, such as inverters, and financing and permitting costs are well over half of the total now. “A lot of the innovation companies are talking about is less on the solar module side, and more about balance of systems and financing,” says Shyam Mehta, a senior analyst at GTM Research.