JoeJoe

Evergreen Solar: Why This Overlooked Company Is a Good Investment

anand,

Evergreen's silicon usage was 5 grams/watt as of Q2 2007. EverQ reported silicon usage as "less than 5 grams/watt" in their Q4 2007 report. See

www.accessmylibrary.co...

Silicon usage (including kerf loss) varies over a relatively wide range. Sunpower is down to 6-6.5 grams per watt. Trina and Suntech are down around 7-7.5 grams per watt. See this primer for industry average estimates of 8.3 g/W for 2008 and 7.9 g/W for 2009.

www.jefferies.com/pdfs...

At $400/kg the difference between 5 g/W and 8 g/W is 120 cents. The fact that Evergreen has struggled to make a profit despite their silicon advantage tells me to stay away from this company in the future because the silicon bottleneck is over. Next stop $40/kg? $30/kg? I don't know but going forward there will continue to be a tremendous incentive to drive down silicon costs.
At the speculative end of things, UMG could bring costs below $20/kg.

There's are other parts of the chain to consider. LDK is currently running trials with 180 micron wafers and you can bet they'll be working on 140 micron wafers before too long. Solaicx is tight-lipped about their technology but it appears their continuous process will all but eliminate tops and tails. At the wafering end of things the guys at Fraunhofer are working on a laser-jet system that produces smoother, thinner wafers and simplifies kerf recycling by eliminating SiC contamination. IIRC EverQ uses a similar process to dice their wafers.

www.ise.fhg.de/veroeff...

I don't see much hope for ESLR...

First Solar's $1/Watt Capex: Half the Industry Average

I think you also got the CIGS conversion efficiency wrong. Global Solar seems to be the leader with an efficiency of about 10%. - news.cnet.com/CIGS-cel...

There's a discount between the cell efficiency and the module efficiency but it wouldn't go all the way down to 6%. Currently, Global seems to be getting the bugs out of their process and if you look back at the history of First Solar you'll see they too had to get the bugs out of their process over many years. From my perspective it seems like an interesting technology to watch because CIGS should have more potential for improving efficiency than CdTe based upon the highest efficiencies achieved in laboratory settings.

Light the Way with LDK

You could be correct about fudging the numbers and I agree we'll have to wait and see... The non-silicon costs look about right but the wafer costs seem much too low. If the numbers were 75 cents/watt and 75% of total cost you'd have wafers costing 2.25/watt rather than 1.65ish.

Has the Sun Set on Solar Energy Stocks?

Not bad Dr. Duru...

I wouldn't short STP if I were you but agree with your take on ESLR. Hell, the wafer manufacturers have almost gotten down to 150 micron and poly prices are set to drop so I don't see where ESLR can go but down.

Spain is being over analyzed by guys that have a terrible history when it comes to predicting the future of this sector. The market should shift back to Germany where the subsidy is stronger. If the prices get low enough demand will kick in from Japan, Hawaii, California etc. It's a big world after all and there's plenty of money floating around. Give these solar companies and their sales departments some credit.

Lately I've been reading into STP's and Q-cells work with UMgSi.
The progress has been incremental so far but I half expect some game-changing news on this front in the not so distant future. The market sure needs some sort of news from one of the major manufacturers to calm it down.

Light the Way with LDK

Sorry... wrong link for the STP earnings call:

seekingalpha.com/artic...

Light the Way with LDK

The fact that LDK has sold all of 2009's projected production is quite impressive - I'm not disputing that. I'm disputing the overly rosy projections for margins and profits. No conspiracy... Just confusing data. Look at the earnings calls yourself and judge data.

phx.corporate-ir.net/p...
biz.yahoo.com/prnews/0...

STP says their non-silicon costs are 70 cents per watt and that their silicon costs (wafers) are 70% of total costs. That makes their wafer costs about $1.63/watt. Then look at LDK's earnings call and they say their ASP are $2.40/watt with margins of about 22.7% - so costs are about $1.99/watt.

Are there any indications of LDK's projected ASPs for 2009?

Light the Way with LDK

Can anyone explain how Suntech can buy wafers for $1.60/watt when LDK's current costs are about $2.00/watt?

Next year Suntech plans on wafer costs of about $1.25/watt. What is LDK expecting wafer costs to be in 2009?

Light the Way with LDK

Intel of the solar sector eh? That's a bold statement. 40-50% margins? Give me a break.

One of the big holes in this analysis is that it does not consider Suntech and it should because Suntech is the low cost Si-PV company. According to their earnings call, Suntech is currently purchasing wafers for about $1.60/watt and they expect costs to be about $1.25/watt in 2009.

LDK's on the other hand currently has costs of about $2/watt with ASPs of $2.40/watt.

How can Suntech purchase wafers at a 20% markdown from LDK's costs? How can company X buy wafers from LDK for $2.40 and hope to compete with Suntech that has a total module cost under $2.40/watt. Something has got to give. It's rather amazing that something hasn't given already because the numbers don't make any sense.

I'm sure LDK is going to do a great job reducing costs but the exaggerated ASPs they've enjoyed over the last year are not going to hold up. No way no how get outta town.

It seems that LDK is going to have to get costs down to half what they currently are and fast. Factor that into your formulas...

Don't Count on Spain for Solar Success

There's some good info in there but some distracting information too. I think you've drawn many unjustified conclusions. Your statistics on Spain are neat but it's silly to say Spain is the primary cause of PV's prominence. PV was doing well a year ago as evidenced by the rising panel prices.

There is nothing frightening about Germany and Spain reducing their subsidy programs. Besides subsidies, it's good to see the price of PV finally coming down because this is important to the future health of this industry. I think it shows there's some competition going on and not just lazy subsidy taking. If the prices continue to trend down this should entice more customers and so by the time Germany starts stepping down subsidies the PV industry should be preprepared by a broader and more competitive market. Let the strong survive.

As far as shorting goes I highly recommend it. There are some fat cows out there that are going to get slaughtered. For now it seems the cows are only going to get fatter but I've got my eye on a few I'd like to gut.

Don't Count on Spain for Solar Success

There's some good info in there but some distracting information too. I think you've drawn many unjustified conclusions. Your statistics on Spain are neat but it's silly to say Spain is the primary cause of PV's prominence. PV was doing well a year ago as evidenced by the rising panel prices.

There is nothing frightening about Germany and Spain reducing their subsidy programs. Besides subsidies, it's good to see the price of PV finally coming down because this is important to the future health of this industry. I think it shows there's some competition going on and not just lazy subsidy taking. If the prices continue to trend down this should entice more customers and so by the time Germany starts stepping down subsidies the PV industry should be preprepared by a broader and more competitive market. Let the strong survive.

As far as shorting goes I highly recommend it. There are some fat cows out there that are going to get slaughtered. For now it seems the cows are only going to get fatter but I've got my eye on a few I'd like to gut.