THE SOLAR INDUSTRY seems to be going through a bit of a rainy patch, as the credit crunch and excess inventory cause solar cell producers to scale back their growth predictions and slash production.
According to market research outfit ISuppli, solar prices are down and companies just don't have the cash to invest in building up major solar installations, even if the ROI looks good in the long term.
The beamcounters reckon the average price per solar watt will fall 12 per cent in 2009, with photovoltaic revenue dropping a full 40 per cent to just $18.2 billion, well below last year's $30.5 billion.
To put it in gigawatts, Isupply says the industry will install just 3.5 gigawatts in 2009 compared with 5.3 gigawatts last year, a shady 32 per cent slump.
This would lead to fewer new suppliers of photovoltaic cells entering the market and a slowdown in building new production plants.
The rain in Spain may stay mainly on the plain, but it is actually the Spanish market which has sparked this burnout in the first place. In 2008, Spain reflected 50 per cent of the world's solar demand, but after a government change of tariffs, the market ground to a slow siesta.
Still, ISuppli says there is light at the end of the tunnel, noting the, "severe downturn in the global Photovoltaic (PV) market in 2009 actually could have a positive outcome for the worldwide solar industry, yielding a more mature and orderly supply chain when growth returns." µ