There’s a great interview on Earth2Tech with Nanosolar CEO Martin Roscheisen, in which he gives his views on the current solar industry. When asked about whether he’d get into the solar business in 2007, he thinks not, as it’s moved into being a high-volume, low-cost industry.
Q). You were one of the first Valley entrepreneurs to focus seriously on green tech – If you had to start a clean tech company in 2007, and not 2002, what would you do differently?
A). I know very little about anything in greentech other than solar. If I had to start a solar company in 2007, I would take a pass. This industry is in a very different stage now. This is going to be like the DRAM business much more quickly than many may realize. I have a hard time seeing how anyone can be successful in solar who isn’t truly in volume in 2008 with a very mature, very cost-efficient technology.
Among other things, he also flags up the concerns about rising Chinese giants in the field, such as Suntech.
Q). An analyst told me that thin film solar companies in the U.S. are worried about price competition with Chinese solar firms. . . .is that true and something Nanosolar thinks about competitively?
A). If I ran a company based on solar thin films deposited in high-vacuum chambers, I’d worry too. Because [Chinese market leader] Suntech achieves better capital efficiency today with conventional silicon-wafer based solar factories than a typical thin-film vacuum line. That’s a problem right there. At Nanosolar though, we have a nanoparticle-based printing process that is 5-10x more capital efficient on the total line. So we have a good delta.
All things being equal, given the $/kg economics of solar panels, I don’t think the competitive end game is to be shipping them from China. The end-game winners will be optimized for net working capital days and proximity to customers. (Btw, shipping from China costs ten times as much as shipping to China these days…) The middle game will be dominated by quality issues; this is a product that people expect to last for decades.
Quality is quite hard to do with the kinds of manual factories that are behind the capital efficiency of Chinese production lines. I see a lot of big customers in Europe quite unhappy with Chinese panels. That all said, my general rule on China is that one has to recheck all of one’s assumptions about China about once every three months.