A standout performance in 2011 has raised expectations but only a few manufacturers like Solar Frontier, Avancis and Solibro are likely to succeed, says Lux Research
BOSTON--The market for solar installations based on copper indium gallium diselenide (CIGS) thin-film panels will nearly double in size to $2.35 billion in 2015, as manufacturers signaled a breakout year in 2011 by taking advantage of falling production costs, improving module conversion efficiencies and increasing adoption in commercial rooftops, according to a Lux Research report titled, "Sorting through the Maze of CIGS Technologies: Who Will Cash in on the Breakout Year?".
"Sorting through the Maze of CIGS Technologies: Who Will Cash in on the Breakout Year?"
The technology is emerging into an early-growth phase and will benefit from a surge in demand to nearly 2.3 GW in 2015, nearly double the current 1.2 GW level. However, it will still face numerous challenges including a sharp fall in venture capital money. In the emerging environment, few manufacturers — among them, Solar Frontier, Avancis, and Solibro — will succeed, mainly through strategic partnerships and investments that are critical to ramp capacities and improve production processes.
"Manufacturers have begun ramping meaningful capacities and there have been tremendous improvements in module efficiency," said Pallavi Madakasira, Lux Research Analyst and lead author of the report. "Now, strategic partnerships between start-ups and industrial conglomerates are likely to determine this technology's overall viability and competitiveness."
Lux researchers positioned CIGS developers using the Lux Innovation Grid, based on their Technical Value and Business Execution, with companies that are strong on both axes reaching the "Dominant" quadrant – and also assessed each company's maturity, providing an overall "Lux Take." Among their conclusions:
Solar Frontier is a clear winner. Solar Frontier is a clear winner, with a solid position in the "Dominant" quadrant – and was the only firm to earn a "Strong Positive" take. With inroads into new and emerging markets such as India, where it is selling over 30 MW of panels, Solar Frontier excels in overall execution.
Global Solar, Avancis and Solibro are likely to consolidate. The three companies are likely to emerge as bankable players. Global Solar has demonstrated slow but steady progress and is currently selling its PowerFLEX Technology, a shingle product, to Dow. Still, to succeed it needs to adopt a less conservative approach. Avancis has a joint venture with Hyundai Heavy Industries for CIGS module production in Asia. As for Solibro it will need to quickly and independently strengthen its financial position to succeed.
Stion, Miasole and Nuvosun can emerge as champions. All three are "Dominant" with the potential to emerge as early champions in this technology. However, their success will depend on capacity utilization and ramp-up, customer relationships, strategic partnerships and consistent execution in terms of their module costs, yield and module efficiency.
ISET, Flisom and AQT can be acquisition targets. All three are "High Potential" companies – firms with strong technical value but weaker business execution scores – and have assets that make them prized acquisition targets.
The report, titled "Sorting through the Maze of CIGS Technologies: Who Will Cash in on the Breakout Year?" is part of the Lux Research Solar Components Intelligence service.
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