(PVCS) PV Crystalox Solar

by July

good post Livic, my moneys on hold and buy more as the picture gets clearer.

It really depends on who goes bust IMHO. During periods of market weakness no one invests in capital items like solar panels and this leads to low prices for capital items as people wait for clarity. This feeds through to the makers of capital items as no one builds new plants to make them and those with debts or high costs go bust. Companies sell down inventory rather than producing more.

As confidence in the economy returns people start buying as prices are cheap. However, inventories have been run down and many of the factories have been shut down. Result is the prices of capital items like solar panels rise strongly.

Thats the theory. My general feeling is that current prices are probably not sustainable with no one making profits and they merely reflect companies selling off inventory below cost for whatever they can get to stay alive. We know PVCS has a lot of cash, little debt and inventory it can sell off to stay afloat. The problems are if PVCS is too high cost to survive in the longer term or subsidies are cut under the assumption current prices are sustainable. The former is possible but PVCSs labour costs are actually quite low as a percentage of its expenses and most people will pay more for good quality capital items anyway. Solar panels need to last 10-15 years simply to get your capital back so would you risk buying from China for 10-20% less or UK/Germany? Subsidies cuts are a bigger problem but they will affect the whole industry. The more subsidies are cut the more companies will go bust the smaller the entire solar industry will become. Prices of solar panels will eventually rise but most of the solar industry could be gone by that point (see below). Could PVCS go bust? Yes eventually but probably not within the next 12 months. To recreate PVCS would cost many multiples of the current SP and I suspect even a fire sale of the inventory and assets could generate more than the market cap even ignoring the cash. A rise to 10-20p on some numbers showing its stabilising is not unreasonable. We had a small directors buy at 8p in November and things have generally looked better since then with spot prices for wafers and the the stock market improving.

Falling solar prices good for climate, bad for firms
There is a bright side to the plunge in solar panel prices that has brought down some U.S. and German manufacturers which relied too heavily on subsidies for green energy - solar power costs have fallen faster than anyone thought possible.

The falls in prices for photovoltaic components, pushed down by economies of scale and fierce competition from China, have made solar nearly as cheap as conventional sources in Germany's electricity grid. The boom in Germany, the world's biggest photovoltaic market with 24,000 megawatts of installed capacity, has also helped to drive down costs worldwide, making solar a more viable and accessible alternative to fossil fuels in places ranging from India and the Middle East to Africa and North America.

The unexpectedly rapid drop in global solar prices has nevertheless hit some equipment makers hard - producers like Solyndra in the United States and Solon in Germany that failed to keep pace and ended up in bankruptcy protection. The demise of Solyndra, which had got $535 million in loans from the U.S. government, is sometimes cited by skeptics as evidence of the dangers associated with supporting the industry with incentives. They argue subsidies waste public money. "Everyone's missing the real story and it's amazing how brain dead some people are," said Jeremy Rifkin, an adviser to the German government and European Union on climate change and energy security. "It's absolutely a positive thing that solar prices are dropping faster than anyone thought they could. "It's actually a great success," the U.S. economist told Reuters. "Those criticizing solar for that are being ignorant or disingenuous. It's a winnowing out process similar to what the computer and communica

From mining news .


Blown away: 70% of Europe’s new power generation comes from renewables

Frik Els | February 5, 2012









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According to a new European Wind Energy Association report a record 71% of all the new power generating capacity installed in the Europe Union in 2011 came from solar panels, offshore and onshore wind turbines and other renewable energy sources.

According to the EWEA reports the amount of clean power installed in 2011 rose to 32 gigawatts from the 23 gigawatts fitted in 2010, which accounted for just over half of new power capacity put in that year. Twelve years ago that figure was just 3.5 gigawatts or 20% of total new capacity.

The bulk of new capacity in 2011 came from solar and not wind power. According to an official EU roadmap for green energy wind farms will become the biggest source of electricity in the bloc by 2050, outstripping both coal and nuclear power.

Coal use could fall to very low levels it is predicted and gas would be the “bridging” fossil fuel until around 2030 or 2035.

The implementation of so-called clean coal power generation, crucial to the coal industry, is facing headwinds in Europe.

The International Energy agency said in its World Energy Outlook released in November, widespread deployment of more efficient coal-fired power plants and carbon capture and storage (CCS) technology could boost the long-term prospects for coal, but there are still considerable hurdles.

The agency says more efficient technology for new coal power plants would require relatively small additional investments, but improving efficiency levels at existing plants would come at a much higher cost.

The IEA says If CCS is not widely deployed in the 2020s, an “extraordinary burden” would rest on other low-carbon technologies to deliver lower emissions in line with global climate objectives.

Today only two small pilot projects in Germany and the US exist and a $4.8 billion project in the UK, which would be the world’s largest appears to be going nowhere.

While clean coal is failing to make an impact, MINING.com reported in November supply shortfalls of rare-earth elements over the next two decades put at risk the EU’s ambitious plans to expand the production of solar, wind and green transport technologies.

According to the EU’s Joint Research Centre, solar will require half the current world supply of tellurium and 25% of the supply of indium, while Europe’s wind energy programme which is supposed to power all of the continents 240 million households within 20 years need a steady supply of neodymium and dysprosium.

China controls 95% of the globe’s rare earth output and last year produced more solar panels than the rest of the world combined.

Read more about rare earth and green technology here and about recent declines in rare earth prices here.

Coal
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