Installations of solar panels in the United States have skyrocketed 69 percent in the second quarter from a year earlier, thanks largely to commercial and government projects, according to an industry trade group report released Tuesday. U.S. manufacturing is an entirely different story, where success is mixed and highly dependent on where the products are headed.
Not surprisingly, much of the media attention has centered on the report's photovoltaic solar installation findings. Developers installed 314.3 megawatts of solar PV power in the second quarter, a 17 percent increase from the first quarter and a 69 percent rise from the same year-earlier period.
However, the analysis of the manufacturing sector is far more intriguing and offers a glimpse of where the domestic industry is headed. The report tells two interlaced manufacturing stories: one of export-oriented companies trying to adjust to new pressures, and another more positive tale of producers focused squarely on the U.S. market.
The health of U.S. PV manufacturers that serve the export markets were tested by rapidly falling prices and a marked slowdown in demand in solar leaders Germany and Italy that caused record levels of inventory. Some U.S. companies have cut back production levels, other less competitive producers canceled planned expansions or idled factories. A number of companies, including Solyndra and Evergreen Solar went out of business entirely.
Meanwhile, companies that make solar products in the U.S. and sell directly to the domestic market have fared much better. The U.S. solar market is the fastest growing market in the world, Rhone Resch, executive director of the Solar Energy Industries Association said in a teleconference Tuesday to discuss the industry report.
Foreign and domestic companies keen on tapping the U.S. market are increasingly building factories here. Resch made particular note of Chinese solar panel maker Suntech Power, which opened last year a 117,000-square-foot plant in Goodyear, Arizona. In May, the company added a third production shift.
The upshot? Domestic module production in the second quarter fell 11 percent from the last quarter as export-oriented companies experienced a slowdown, while steady growth was seen with producers more heavily weighted toward serving the U.S. market, the report said.
Here are a few other items from the report:
- Residential installations fell slightly from the first to the second quarter of 2011. Although the researchers say this isn't indicative of a long-term pattern. Colorado, New Jersey, New York and Pennsylvania saw declines.
- Commercial and government installations grew 22 percent in the second quarter. However, some markets including California and Colorado saw non-residential installs drop.
- Utility installation grew 37 percent to 50 megawatts in the second quarter.
- The dominant majority of modules produced in the U.S. in the second quarter were crystalline silicon (72%) and cadmium telluride (22%), CIGS (5%) and amorphous silicon (1%).
- Overall U.S. thin film production share stood at 27.5 percent and is expected to increase.
Photo: Flickr user Living off the Grid, CC 2.0