The rapid decline in prices has been a boon for solar installation and financing companies. Not so much for solar manufacturers, an industry in the throes of a painful consolidation. German-based Solon, which already closed its 60-megawatt solar panel factory in Tucson, Arizona, is the latest company to struggle with its finances.
Solon filed this week an application to restructure its loans for three of its subsidiaries through insolvency proceedings. For the past several months, Solon was engaged in what it described as "intensive efforts" to restructure its loan through talks with investors, the financing banks and the guarantors, the company said in a release. The negotiations to reach an amicable solution failed, forcing Solon to file for insolvency.
Solon joins a growing list of struggling solar panel manufacturers grappling with grappling with a particularly sticky challenge: sales are up in many cases, but prices are falling even faster with a consequent drag on profits.
Last month, Energy Conversion Devices, a maker of solar thin film laminates, shut down production and announced it would furlough about 400 employees at its factories in Michigan, Mexico and Canada. The Michigan-based company said it also planned to cut 500 jobs at the end of the year.
SolarWorld closed its California solar module assembly factory back in February. And, of course who could forget Solyndra, the Energy Department loan guarantee darling that went belly up earlier this year. Evergreen Solar and SpectraWatt of New York also filed for Chapter 11 bankruptcy protection and Ascent Solar Technologies staved off its demise by agreeing to sell a stake in the companyand license its technology to China’s TFG Radiant Group.
Expect consolidation in the coming months -- and not just in Europe and the United States. Chinese solar manufacturers, which have been blamed for flooding the market with cheap modules, also may close down or be gobbled up by bigger companies.
Photo: Flickr user Living off the Grid, CC 2.0
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