16 November 2010

CdTe to maintain lead over silicon in cost

Advances in crystalline silicon technology, and the falling cost of the polysilicon raw material, have only increased the pressure on manufacturers of emerging thin-film technologies, including thin-film silicon (TF-Si), cadmium telluride (CdTe), and copper indium gallium diselenide (CIGS), according to a new report ‘Module Cost Structure Breakdown: Can Thin Film Survive the Crystalline Silicon Onslaught?’ from Lux Research.

In the face of renewed pricing pressures, solar device makers have had to refocus on minimizing costs and maximizing performance as many need to improve profit margins or face extinction, says the market research firm. In particular, with a clear edge in both efficiency and profit margin, crystalline silicon solar modules threaten to steal market share from thin-film solar technologies, the report adds.

The report compares incumbent multicrystalline silicon (mc-Si) technology (representing about 80% of the crystalline silicon market) on a $/Watt basis against three challengers: TF-Si, CdTe and CIGS. It also surveys process changes and cost-reduction efforts that module developers have undertaken, and forecasts which technology will gain a long-term cost advantage at the module level.

“Crystalline silicon is dominant by volume and remains the cost/price benchmark for solar modules. Cadmium telluride is limited in efficiencies, but is the absolute leader in cost,” says Ted Sullivan, senior analyst and lead author of the report. “These two technologies will continue to be highly profitable,” he projects. “The profitability of thin-film silicon is much dicier, but CIGS is positioned to outplace crystalline silicon in profitability by 2013 as leading developers improve process stability.”
To forecast how module developers would reduce the key components of cost (capital, materials, utilities and labor), Lux Research built detailed cost-of-goods-sold (COGS) models for the four key technologies (mc-Si, TF-Si, CdTe and CIGS) through 2015, including both glass and flexible substrates for CIGS. The key observations include:

  • Multicrystalline silicon remains highly profitable as COGS decline. The dominant technology will continue to be profitable throughout the value chain as vertically integrated players drive cost from $1.45/W in 2009 to $0.93/W in 2015, assuming poly pricing at $70/kg. Efficiency will be a key driver of cost reduction, rising from 14.0% in 2009 to 16.1% in 2015.
  • Improvements enabled by Oerlikon’s new ThinFab line will push thin-film silicon efficiencies from 9.0% to above 11.0%. Significant improvements in output will cut depreciated CapEx per watt, and help to reduce TF-Si costs from $1.32/W in 2009 to $0.80/W in 2015.
  • CdTe technology remains the long-term leader in terms of COGS. Led by First Solar, CdTe has a significantly lower cost structure than mc-Si, and its cost reductions will march onward, keeping it the most profitable solar technology, as COGS falls from $0.80/W in 2009 to $0.54/W in 2015.
  • Costs for select CIGS technologies drop dramatically. CIGS sputtered on glass – which is Lux Research’s benchmark, given its critical mass of developers – will see COGS plummet from $1.69/W to $0.76/W as efficiency improves from 10.0% to 14.2%, and factory nameplate capacity and yields grow, allowing the top developers to earn gross margins over 30%.

See related items:

Solar installations to grow at 23% annually to 2015, but revenue to lag at 14%

Tags: CdTe CIGS

Visit: www.luxresearchinc.com

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