Over the past couple of weeks the solar energy industry has been hit with some challenging news regarding some of the worlds largest solar panel manufacturers. Many are going bust. This news follows the great news that the United States solar power market is growing rapidly and that solar power was the second largest new energy deployed in the US. Take the good with the bad.
One of the worlds largest solar panel manufacturers, Suntech Power, last week defaulted on $541 Million in debt according to Forbes online. Shi Zhengrong, was once China’s richest man, with a net worth of over $1.7 billion, has now seen his fortune… Sunset, the CEOAlong with the default and hopes for restructuring the company will also shut down its solar panel manufacturing plant in Arizona. The company was a Chinese solar panel manufacturer and was considered a major player in not only the United States solar panel market but also globally.
Within the past 12 months the global solar panel manufacturing business has been hit with some challenges, particularly, tariffs on imported panels from China. With all of the manufacturers vying for the top spot and cheapest price per watt the tariffs have left many solar panel manufacturers in tough positions just like Suntech. Bosch Solar will shut down or sell their solar panel manufacturing plant.
It turns out the tariffs may have backfired on those companies that supported it. SolarWorld AG has been in talks with its investors and bond holders to restructure its debt, although the debt laden company continues to pursue positive messaging in the United States solar power market. The company is one of Germany’s largest solar panel manufacturers and also has a state of the art facility in Oregon.
Fortunately there is still some good news in the solar panel manufacturing market. The failure of these companies will most likely reduce the glut of solar panels in the industry for low cost, highly subsidized competitors which will make room for greater investment from quality companies in new equipment and manufacturing process. This will ultimately increase solar panel efficiency and reduce cost in the long term. Consolidation or elimination in the industry is beginning to occur in the lower quality manufacturers while the higher quality well capitalized manufacturers, like SUNPOWER, are continuing to maintain and even gain market share and increase the quality of their technology.
For residential customers, Abundant Energy currently offers a 20 year loan to qualified customers to finance their solar array by offering a low monthly payment essentially allowing customers to refinance their currently escalating utility bill with a low interest fixed payment. Customers are able to apply their rebate payments, the Federal tax credit of 30% and principle payments to the balance over an 18 month period and then re-amortize the loan to a new even lower payment at no cost.