Challenges to Thin-film Manufacturers

capa finaThere have been many media reports recently which discuss what a risky industry the thin-film industry is, citing large companies who are backing out of the market. However, it is important to remember that crystalline had almost a 3-decade head start on thin film which has not had the level of sustained technology investment that crystalline photovoltaics has enjoyed. It has only been truly commercial in the latter part of the past decade, and market shares are already projected to grow to 31% by 2013 (iSuppli Corporation, 2009). Investors and customers are starting to see the potential in thin film–and believe that in just a few more years it could become the predominant technology in the photovoltaic industry. These projections show the bright future ahead for thin film–but it is not without its challenges.

SEOUL, SOUTH KOREA (October 26, 2010) – Thin-film technology continued to progress, focusing on niche portable and flexible applications and has recently gained greater acceptance as a viable photovoltaic technology for the mass market. This late start has made it difficult for thin-film manufacturers that are now trying to gain a foothold in the mainstream PV market. These manufacturers are faced with three basic challenges:

1. Lower efficiency. Due in part to the lack of research and development investment thin-film technologies suffer from significantly lower efficiencies than that of crystalline–requiring as much as double the space to deliver the same power. This can be a problem in space constrained installations, but also increases the relative cost of racking, wiring and installation, forcing thin-film manufacturers to sell their modules at a lower price per watt than their crystalline counterparts. While some of the technologies will likely never be on par with crystalline technology in terms of efficiency, others show promise and are likely to catch up as production volumes increase. For example, CIS technology is already delivering commercial product with efficiencies between 10-12%. Most recently, in Germany on May 4  2010, researchers at the Centre for Solar Energy and Hydrogen Research created a CIS cell which was 20.1% efficient and could produce a market ready product with 15% efficiency within the next few years (Photovoltaics World, 2010).

2. Near-term cost competitiveness. Much of the recent investment in thin-film manufacturing technology was driven by the high market prices in recent years. As these new thin-film factories came online, the market dynamics had changed and module prices plummeted. With much lower margins available to support their ambitious growth plans, some thin-film companies are closing their doors. However, most are pressing on with a focus on sustainable growth supported by R&D to improve efficiency in order to be able to reach their potential.
First Solar, the thin-film success story, is the exception to this rule and has achieved production costs which are half of that of crystalline at US$0.90 with efficiencies of between 10-11%. While the characteristics of its technology certainly contributed to this achievement, First Solar has also had the benefit of steady investment into the development of its proprietary technology and its manufacturing capacity over the past decade.

3. Bankability. Although it has been around for over 20 years, thin film is seen as a ‘New‘ technology. This creates difficulty in getting project financing. Again, the dropping prices on crystalline technology, and an oversupply situation exacerbate the problem for thin film since proven alternatives are available. Thin-film manufacturers are overcoming this barrier through intensive reliability testing and through support from large insurance companies who will stand behind the warranties.

Thin-film Outperforms
However, new research results are showing thin-film modules outperforming crystalline modules in non-ideal (i.e., real-world) conditions–better performance data in lower light levels such as diffused light, as well as in direct sunlight with high temperatures. For example, in two case studies presented by Forrest Collins of juwi Solar at a recent thin-film solar conference in California, their cadmium telluride installation showed a 3.2%-5.7% higher performance than crystalline at the same location.
While this higher output relative to rated power is a clear benefit on its own, there is a deeper benefit–especially when it comes to commercial installations: The performance of thin-film modules suffers less than that of crystalline when they are not installed at the ideal orientation. This becomes a more important factor as photovoltaic systems move from highly engineered showcase installations to more practical installations where the system is treated more as a building appliance. In these cases, the goal is to keep the upfront engineering and custom design costs as low as possible. This results in a ‘structurally optimized‘ installation, meaning an installation aligned with the building structure and at relatively low tilt. The superior performance of thin film under such conditions will help the technology to establish itself in the mainstream commercial rooftop market, and will eventually lead to its dominance of BIPV applications–the ultimate ‘structurally optimized‘ installation.
(Text by Brent Harris, Vice President at Sustainable Energy Technologies (www.sustainableenergy.com)).

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