Stephen O'Rourke | PV Status and Pathways
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![Stephen O‘Rourke (212) 250-8670 ,[object Object],Solar PV industry – long-term outlook Broad cost convergence over the next 6 plus years c-Si CIGS -Si (2x) CdTe US - Average price of electricity in 2009 est: 9.5 cents/kWh Electricity from solar PV is becoming cheaper… … and grid costs are rising Grid cost convergence Periodic over-supply is inevitable Potential for explosive growth in demand upon convergence New technology wildcard ,[object Object],[object Object],[object Object],Supply Demand Source: Deutsche Bank estimates 6% 5% 4%](data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7)
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Stephen O'Rourke | PV Status and Pathways
- 1. Solar Photovolatic Industry Institute for Analysis of Solar Energy – 24 April 2009 Deutsche Bank Securities Stephen O‘Rourke (212) 250-8670 All prices are those current at the end of the previous trading session unless otherwise indicated. Prices are sourced from local exchanges via Reuters, Bloomberg and other vendors. Data is sourced from Deutsche Bank and subject companies. Deutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. Independent, third-party research (IR) on certain companies covered by DBSI's research is available to customers of DBSI in the United States at no cost. Customers can access IR at http:// gm.db.com/IndependentResearch or by calling 1-877-208-6300. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1 Solar Impulse HB-SIA prototype airplane © Solar Impulse/EPFL Claudio Leonardi
- 3. Stephen O‘Rourke (212) 250-8670 Economics by technology (what companies can do…)
- 7. Stephen O‘Rourke (212) 250-8670 The LCoE Gap (c-Si) $0.00 $0.10 $0.15 $0.20 $0.35 $0.40 Levelized Cost of Electricity (LCoE) – US$/kWhr Installed cost/Wp – US$/Wp $3.50 $4.00 $4.50 $5.00 $5.50 $6.00 $6.50 $7.00 $1.50 $2.00 $2.50 $3.00 $0.05 Solar PV LCoE (1MWp x-Si system) (Santa Maria, CA – 1.573kWhr/Wp fixed mount, 6% interest rate) ~$5.50/Wp (Ave today) No incentives w/ 30% grant/ITC w/ accelerated depreciation Industrial(2008): 7.02¢/kWhr 2008 average retail price: 9.81¢/kWhr State Incentive plan ~$1.00/Wp installed Residential (2008): 11.35¢/kWhr $0.25 $0.30 Source: PG&E, EIA, SunPower 2008 analysts day presentation, and Deutsche Bank estimates Santa Maria, CA Comb Cycle Nat Gas LCoE of $0.073 to $0.121/kWhr Gas Peaking Power LCoE of $0.221 to $0.352/kWhr Wind Generation LCoE of $0.044 to $0.091/kWhr
- 8. Stephen O‘Rourke (212) 250-8670 The LCoE gap (c-Si) $0.00 $0.10 $0.15 $0.20 $0.25 $0.30 $0.35 $0.40 Levelized Cost of Electricity (LCoE) – US$/kWhr Installed cost/Wp – US$/Wp $3.50 $4.00 $4.50 $5.00 $5.50 $6.00 $6.50 $7.00 $1.50 $2.00 $2.50 $3.00 $0.05 Solar PV LCoE (1MWp x-Si system) (Newark, NJ – 1.183kWhr/Wp fixed mount, 6% interest rate) No incentives w/ 30% grant/ITC w/ accel depreciation 2008 average retail price: 9.81¢/kWhr Residential (2008): 11.35¢/kWhr Industrial(2008): 7.02¢/kWhr w/ 30% grant/ITC w/ accel depreciation No incentives Newark, NJ Source: EIA, SunPower 2008 analysts day presentation, and Deutsche Bank estimates Solar PV generated electricity is much more expensive in NJ. However, NJ’s SREC program allows the sale of related carbon credits at ~$0.40 to $0.71/kWhr, offering an attractive market. Comb Cycle Nat Gas LCoE of $0.073 to $0.121/kWhr Gas Peaking Power LCoE of $0.221 to $0.352/kWhr Wind Generation LCoE of $0.044 to $0.091/kWhr
- 11. Comparing production solutions (optimized c-Si mfg) $0.02 $0.10 $0.12 $0.14 $0.16 $0.18 $0.20 $0.22 Levelized Cost of Electricity (LCoE) – US$/kWhr Installed cost/Wp – US$/Wp $0.06 Stephen O‘Rourke (212) 250-8670 $3.50 $4.00 $4.50 $5.00 $5.50 $6.00 $6.50 $7.00 $1.50 $2.00 $2.50 $3.00 $0.08 $0.04 Comparing 1MWp scale systems (6% interest rate) Case V (low c-Si cost) Total installed price of $3.46/Wp Source: Deutsche Bank estimates Wind Generation LCoE estimated at $0.044 to $0.091/kWhr Comb Cycle Nat Gas LCoE estimated at $0.073 to $0.121/kWhr Gas Peaking power LCoE estimated at $0.221 to $0.352/kWhr China low cost example Declining c-Si cost progression $3.46 $3.88 $4.25 $4.73 $5.19 Installed $/Wp P-Si costs from $120/kg (case I) to $40/kg (Case V), using 7g/Wp P-Si wafering Cell, Module Module GM 17% B/S cost Inverter cost Install GM 12% Labor & Misc.
- 13. Stephen O‘Rourke (212) 250-8670 Supply and Demand (what an industry does…)
- 15. Stephen O‘Rourke (212) 250-8670 Supply vs Demand Solar PV supply & demand forecast Forecast 40% Source: Deutsche Bank Source: Deutsche Bank estimates Solar PV industry CAGR (5% increments from 30% to 60%) Supply Base case Supply Upside Supply Downside Demand Upside Demand Downside 30% 35% 55% Module output (CAGR) 45% 8.8 5.6 Sales downside case 12.5 7.2 Sales upside case 10.9 6.2 5.5 Sales base case 2010 2009 2008 Total module supply (GWp) * “Sales” is adjusted for FGI, etc. at year-end c-Si module supply (GWp) 8.2 4.7 4.7 Sales 9.7 5.5 5.2 Production 2010 2009 2008 2.7 1.6 0.8 Sales 3.1 1.8 0.9 Production 2010 2009 2008 Thin film module supply (GWp) Source: Deutsche Bank Module demand (MWp installed) Demand Base Case
- 18. Stephen O‘Rourke (212) 250-8670 Business models and markets (measuring strategic acumen…)
- 20. Stephen O‘Rourke (212) 250-8670 Solar PV – a means of translation (measuring an industry’s health and maturity)
- 22. Stephen O‘Rourke (212) 250-8670 Thank you
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