First Solar sells California project to NRG

Mon Nov 23, 2009 1:25pm EST

* NRG to buy 21-megawatt solar project in Blythe

* Financial terms of deal not disclosed

LOS ANGELES, Nov 23 (Reuters) – U.S. solar power leader First Solar Inc (FSLR) said on Monday that it was selling the first of its utility-scale solar power projects in California to national power plant operator NRG Energy Inc (NRG).

The companies did not disclose financial terms of the deal.

First Solar will operate the 21-megawatt solar power project for NRG Energy under a long-term contract, the company said in a statement.

Macquarie Securities analyst Kelly Dougherty said in a note to clients that the news “is an incremental positive” for First Solar and will likely add to the company’s revenue for the fourth quarter.

Tempe, Arizona-based First Solar started building the project in September. The plant, about 200 miles east of Los Angeles in Blythe, California, is expected to be finished by the end of the year. Electricity from the plant will be sold to Southern California Edison, a unit of Edison International (EIX).

First Solar is one of the world’s largest producers of photovoltaic cells, which turn sunlight into electricity. Its production costs are the lowest in the industry, although its thin-film cadmium telluride cells are not as efficient in capturing sunlight as more traditional silicon-based cells.

The sale follows another recent deal for First Solar. In October, the company sold a 20-megawatt solar power project in Ontario to Enbridge Inc (ENB), Canada’s largest oil pipeline company.

Princeton, New Jersey-based NRG has mostly fossil fuel-heavy power plants that generate enough electricity to serve 20 million U.S. households, but plans to add a range of renewable energy technologies.

The company owns three land-based wind farms in Texas and invested in solar thermal start-up eSolar earlier this year.

Shares of First Solar were up half a percent at $121.84 each in trading on Monday on the Nasdaq.

(Reporting by Laura Isensee; Editing by Steve Orlofsky)

NRG buys Blythe solar project from First Solar

NRG buys largest utility-scale solar project in California from First Solar; terms undisclosed

11:51 am EST, Monday November 23, 2009

PRINCETON, N.J. (AP) — NRG Energy Inc. (NRG) on Monday said it bought the 21 megawatt Blythe solar energy project in California from First Solar Inc. (FSLR) for an undisclosed amount.

The New Jersey-based power plant owner said the site — located in Riverside County in southeastern California — is the first and largest utility-scale photovoltaic solar project in the state.

The Blythe plant will be connected to Southern California Edison’s (EIX) electrical distribution grid, and electricity will be sold to SCE under a 20-year power purchase agreement. At peak capacity, the site will be able to power almost 17,000 homes, NRG said.

Using First Solar’s thin film photovoltaic panels that convert sunlight directly into electricity, the project will generate more than 45,000 megawatt-hours of electricity per year, displacing more than 12,000 tons of carbon dioxide emissions per year. That’s the equivalent of taking 2,200 cars off the road.

The plant uses about 350,000 solar modules, each measuring 2 feet by 4 feet, which cover about 200 acres. The project uses no water during normal operation, the company said. Construction began in September and is expected to be completed by year-end.

First Solar will provide operations and maintenance services at Blythe under a long-term contract with NRG.

Shares of NRG rose 20 cents to $24.01 in morning trading. First Solar shares rose $1.48 to $122.67.

First Solar Sells California Solar Power Project to NRG

21 Megawatt Blythe Project is California’s Largest Photovoltaic Facility

8:00 am EST, Monday November 23, 2009

TEMPE, Ariz.–(BUSINESS WIRE)–First Solar, Inc. (FSLR), today announced the sale of the 21 megawatt (MW) AC solar energy project it has developed and constructed in Blythe, Calif., to NRG Energy, Inc (NRG).

Located in Riverside County about 200 miles east of Los Angeles, the Blythe project is California’s first and largest utility-scale photovoltaic (PV) solar generation facility, and among the largest in North America. Construction began in September and is expected to be completed by year-end. Electricity from the plant will be sold to Southern California Edison (EIX) under a 20-year power purchase agreement.

“First Solar is very pleased that the first of our utility-scale solar projects in California will be coming on line with a leading power producer like NRG,” said Bruce Sohn, president of First Solar. “This clean, affordable, and sustainable energy will help California meet the goals of its Renewable Portfolio Standard.”

Using First Solar’s industry-leading thin film PV panels that convert sunlight directly into electricity with no water consumption during operation, the project will generate over 45,000 megawatt-hours of electricity per year. The solar generation displaces over 12,000 tons of carbon dioxide emissions per year—the equivalent of taking 2,200 cars off the road. The construction of this project created 175 green jobs.

First Solar will provide operations and maintenance services at Blythe under a long-term contract with NRG. Financial terms of the agreement were not disclosed.

First Solar is developing 1,300 megawatts of PV solar projects under contracts with utilities in California and the Southwest.

First Solar plant re-energized

Expansion reflects growth in demand across North America

First Solar Inc., which began in Toledo and is headquartered in Arizona, has its only North American factory in Perrysburg Township. The plant is expanding.

By GARY T. PAKULSKI
BLADE BUSINESS WRITER

A huge expansion of a solar panel manufacturing plant in Perrysburg Township is nearing completion just in time for a massive planned increase in solar energy use across the United States and Canada.

Utility-scale solar fields, mostly in the West and South, will consume the output of the First Solar Inc. (FSLR) plant through 2015 and probably will cause the company to import panels from its factories in Europe and Asia, an official said.

“We definitely have created demand in the United States far beyond what that single plant can supply and will need to supplement that with product from other plants,” said Alan Bernheimer, a company spokesman.

Executives launched an initiative two years ago to boost U.S. sales to correspond with the company’s growing manufacturing capacity and offset any cooling of a solar energy-building boom in Europe that consumed millions of Perrysburg Township-made panels. Those efforts are now bearing fruit.

Massive solar fields built by First Solar have been completed or are nearing completion outside Las Vegas, in southern California, and in Ontario along Lake Huron.

Five other big First Solar projects that probably will use panels from the suburban Toledo plant are under way or have been announced. They include one that would become the largest solar array in the nation, covering nearly seven square miles and producing enough electricity for 160,000 homes.

All of the projects are multiple-acre solar fields that will be connected to the nation’s electric grid.

An evolution
If the company moves forward on already-announced projects, the work would consume more than 18 million of the 2-foot-by-4-foot panels that First Solar produces.

“That’s great news,” said Steve Weathers, president of Toledo’s Regional Growth Partnership. “What we like to see with any company is growth in their customer base.”

He said the local plant’s growth demonstrates an evolution in the local economy as northwest Ohio and southeast Michigan shift to other industries and away from heavy reliance on jobs in auto manufacturing.

California utility wins OK for more transmission

Fri Nov 20, 2009 6:21pm EST

* California regulatory agency clears application

* Southern California Edison to build 150-mile line

* When completed, line to move 1.2 gigawatt of power

LOS ANGELES, Nov 20 (Reuters) – Southern California could gain more transmission capacity — needed to accommodate electricity from renewable resources — after a project by utility Southern California Edison won approval from a key state agency on Friday.

The California Public Utilities Commission cleared the utility’s proposal for the $537 million, 150-mile project, called the Devers Palo Verde2 line, the utility said in a statement.

Southern California Edison, a part of Edison International (EIX), modified its original 270-mile Devers Palo Verde proposal earlier this year after Arizona utility regulators rejected construction of the line in that state, saying they did not want to export additional power to California.

When completed in 2013, the project is expected to move an extra 1.2 gigawatts of power from Riverside County to energy customers in Southern California.

The 128-mile, 500-kilovolt line will connect SCE’s Devers substation near Palm Springs to a proposed Midpoint switchyard near Blythe, California. SCE also will build a 42-mile, 500-kv line between the Devers substation and its Valley substation in Riverside County.

The project will relieve transmission congestion in an area identified by federal agencies and could help move more electricity generated by solar and other renewable energy resources in the future, the utility said in a statement.

California has the most aggressive renewable energy goals in the United States, with a target to get a third of its electricity from renewable resources by 2020.

A major hurdle, however, is a lack of transmission lines needed to move electricity from remote areas where solar, wind and other renewable power is produced, to cities where it is consumed.

In August SCE and U.S. solar leader First Solar Inc (FSLR) announced plans for two photovoltaic solar projects for a total of 550 megawatts in the California counties of Riverside and San Bernardino.

Arizona-based First Solar is one of the world’s largest producers of photovoltaic cells, which turn sunlight into electricity.

The SCE’s transmission line is also subject to approval of the California Independent System Operator.

(Reporting by Laura Isensee and Eileen O’Grady; Editing by Christian Wiessner)

First Solar Exec Gaffney Leaves; Profit Hit On Severance

By Eric Savitz
barrons.com

First Solar (FSLR) disclosed in an 8-K filing this morning said EVP and corporate secretary John Gaffney is leaving his post by “mutual agreement” with the company. Gaffney, formerly an attorney with Cravath, Swaine & Moore, was in charge of the company’s sustainable development and environmental affairs activities, as well as the legal and corporate development departments.

According to the filing, the company will take a $6.9 million after-tax Q4 hit to net income to cover his severance, or about 8 cents a share.

Gordon Johnson, an analyst with Hapoalim Securities, notes that Gaffney was involved in recent efforts to lobby for continued exclusion of the company’s cadmium telluride solar products from a pair of European standards known as WEEE (the Waste Electrical and Electronic Equipment directive) and RoHS (the Restriction of Use of Certain Hazardous Substances directive). As the New York Times recently reported, there is a move in Europe to extend the rules to cover the use of cadmium in solar products.

“Given Mr. Gaffney’s role as the lead coordinator in such effort, we question the inconvenient timing of his departure,” Johnson writes in a research note. “Mr. Gaffney’s termination during such a crucial period carries potentially negative inferences and could be indicative of negative complications in the company’s recent lobbying efforts. We reiterate out view that any tightening of EU regulations on cadmium in PV panels would be extraordinarily detrimental to FSLR and highlight the possible negative conjectures of Mr. Gaffney’s awkwardly timed departure.”

Johnson notes that FSLR produces only products that are cadmium-based, and that the current RoHS rule limited the amount of CdTe to 100 parts per million in any substrate – while the CdTe layer in First Solar’s panels are 47% Cadmium (or in other words, 470,000 parts per million.) “Thus, to be clear, FSLR is not currently in compliance with the RoHS directive, and will likely need to apply for an exemption in the near future,” creating “a large risk to the investment case” for FSLR shares, he writes.

FSLR today is up 47 cents, or 0.4%, to $123.88.

First Solar and Ordos Take Key Step Forward in 2GW China Project

Cooperation Framework Agreement Signed During China-US Presidential Summit

4:30 am EST, Tuesday November 17, 2009

BEIJING–(BUSINESS WIRE)–First Solar, Inc. (FSLR) today announced a Cooperation Framework Agreement with the Chinese government that takes another critical step towards the realization of the world’s largest solar power plant in the autonomous region of Inner Mongolia, China.

First Solar President Bruce Sohn and Mayor Yun Guangzhong of the Ordos City Government signed the Cooperation Framework Agreement in the presence of Chinese Vice Premier Li Keqiang, Vice Minister Liu Qi of the National Energy Administration, and U.S. Secretary of Energy Steven Chu. The Agreement between First Solar and Ordos spells out additional project details and local support that advance the development of the 2 gigawatt (GW) solar power plant and confirm the June 1, 2010 expected construction start date for the 30 megawatt (MW) Phase 1. First Solar and Ordos also agreed to establish two committees to ensure the successful execution of the project and to develop a new energy industry in Ordos.

“This Cooperation Framework Agreement and its recognition by the National Energy Administration mark a critical step forward in the approval process for the Ordos project, one of the world’s most ambitious renewable energy projects,” said First Solar Chief Executive Officer Rob Gillette. “It reinforces the commitment of First Solar, the Chinese government, and the Ordos local government to make an immediate contribution to the development of a healthy solar industry in China and to the reduction of greenhouse gas emissions.”

The signing ceremony took place as part of the U.S.-China Summit where U.S. President Barack Obama and Chinese President Hu Jintao met to discuss upcoming global climate change negotiations and clean energy, among other topics. “President Obama’s trip to Beijing is a significant step forward in further solidifying bilateral relations with China. First Solar is enthusiastic in contributing to the commercial relations of our two countries through this Cooperative Framework Agreement,” said Mr. Gillette.

“Solar energy will play a significant role in achieving China’s low carbon future,” said Yun Guangzhong, Mayor of Ordos City. “We are very pleased to be partnering with one of the solar industry’s global leaders in a project of such significance.”

The 2GW First Solar project is to be built in multiple phases, beginning with the 30MW Phase 1. Phases 2, 3 and 4 are to be 100MW, 870MW, and 1,000MW, respectively. Phases 2 and 3 are to be completed by 2014 and Phase 4 is to be completed by 2019. The project is part of a planned 11.95GW New Energy Industry Demonstration Zone in Ordos City, Inner Mongolia. The New Energy Industry Demonstration Zone is expected to combine solar, wind, hydroelectric and biomass power sources to provide a steady supply of renewable energy to the region that includes the Chinese capital.

Yesterday, Mr. Sohn participated in a Clean Energy Roundtable with National Energy Administration Vice Minister Liu Qi, Energy Secretary Chu, Commerce Secretary Locke, U.S. Trade Representative Kirk and a small group of senior U.S. and Chinese business executives. During the high-level Roundtable, in which First Solar was asked to address the significance of renewable energy, Mr. Sohn told participants that China’s vision and leadership in supporting solar energy and the Ordos project will “serve as a model of renewable power generation for the world. Projects such as Ordos will enable significant cost reductions through scale, and make solar a truly sustainable energy source in the near future. First Solar is committed to helping build a sustainable solar industry and low carbon economy in China by bringing advanced solar PV technology, global experience, and a focus on cost reduction and environmental sustainability.”

The Cooperation Framework Agreement sets forth the agreement in principle of the parties concerning the project and related activities. Final agreement between the parties is subject to the negotiation and execution of definitive agreements among the parties.

Solar Stocks Rally As Yingli Forecasts Stable Pricing

By Eric Savitz
barrons.com

Solar stocks are flying today after some bullish comments Friday on pricing in the solar sector by Yingli Green Energy (YGE) CFO Bryan Li on the company’s Q3 conference call on Friday. Li said he expects Q4 average solar products pricing to be flat to down slightly in Q4 from Q3, with flat to up pricing in Q1 of next year.

Merrill Lynch/Bank of America analyst Lu Yeung wrote in a Friday research note that the ASP forecast “bodes well for the broader industry group.”

Barclays Capital Vishal Shah likewise noted in a report today that the comments from YGE management suggest that “the price war in the solar industry may be temporarily over.” He added that while weather, Germain feed-in-tariff reductions and development of non-German markets will be important in how 2010 plays out, “YGE’s comments increase the prospects of potential upward earnings revisions for the sector in the near term.”

Janney Capital Markets analyst John Roy today upped his rating on on YGE to Buy from Neutral, “as the outlook for pricing and thus margins have improved.” He contends that “Yingli is a major price setter, and they are guiding to a more benign pricing environment in 2010.” He adds that “there is other evidence that prices are beginning to stabilize,” and that the trend should continue.

Ergo, most solar stocks are sharply higher:

* Suntech (STP) is up $1.75, or 12.8%, to $15.47.
* Sunpower (SPWRA) is up 63 cents, or 2.4%, to $27.05.
* Canadian Solar (CSIQ) is up 74 cents, or 4%, to $19.19.
* Yingli is up 54 cents, or 4%, to $13.99.
* First Solar (FSLR) is up $4.74, or 4%, to $123.04.
* Evergreen Solar (ESLR) is up 8 cents, or 5.4%, to $1.56.
* LDK Solar (LDK) is up 58 cents, or 9.1%, to $6.97.

Solar Leaders One Year Later

From our entry November 13, 2008 in Time to start re-entering the leaders.

Company	Entry	Last	$ G / L	% G / L
CSIQ – Canadian Solar Inc.	$    5.50	$   19.48	$   13.98	254%
ENER – Energy Conversion Devices, Inc.	$   25.00	$   11.11	$  (13.89)	-56%
FSLR – First Solar Inc.	$ 110.00	$ 123.03	$   13.03	12%
HOKU – Hoku Scientific Inc.	$    4.00	$    2.42	$   (1.58)	-40%
SPWRA – SunPower Corp.	$   25.00	$   27.09	$    2.09	8%
STP – Suntech Power Holdings Co. Ltd.	$   10.00	$   15.26	$    5.26	53%
Average Gain				39%

Solar power startup Ausra looks to sell itself

Fri Nov 13, 2009 9:40pm EST

* Potential buyers are international conglomerates

* Deals in “aggressive level” of discussion

* Solar thermal start-up raised $130 mln in venture capital

By Laura Isensee

LOS ANGELES, Nov 13 (Reuters) – Kleiner Perkins and Khosla Ventures-backed solar thermal start-up Ausra Inc is in talks to sell itself with three potential buyers, two sources familiar with the company told Reuters on Friday.

The buyers could take a majority stake or snag the whole company and the discussions are at a “very aggressive level”, said one source familiar with the company, who was not authorized to discuss the matter publicly.

Both sources said the interested companies were global conglomerates in the power generation business but declined to name them. The companies already have various power products, such as steam and gas turbines, and are committed to renewable energy. One interested party has engaged with Ausra previously, one source said.

Ausra declined to comment.

A sale of the high profile Silicon Valley start-up that has raised $130 million in venture capital would add to a string of recent deals and growing consolidation in the solar power industry.

Chinese solar wafer manufacturer ReneSola Ltd (SOL) plans to buy Dynamic Green Energy Ltd while silicon maker MEMC Electronic Materials Inc (WFR) plans to acquire privately-held SunEdison, which installs, maintains and finances commercial solar systems.

Privately held Ausra, which is based in Mountain View, California, launched as a solar thermal developer in 2006, when solar power and other clean technology were luring venture capitalists.

Two years ago the company landed a power purchasing agreement with California utility PG&E, a unit of PG&E Corp (PCG) for a 117 megawatt solar thermal plant. Solar thermal plants use the sun’s rays to heat liquid to create steam, which drives turbines and generates electricity.

Earlier this year, the company switched tracks, saying it would move away from developing projects and focus on supplying large-scale solar steam generators.

This month Ausra said that it canceled its agreement with PG&E and sold the project’s land to the largest U.S. solar power company, thin film photovoltaic First Solar Inc (FSLR).

Ausra also has deals in Jordan and Australia and other investors include Starfish Ventures and KERN Partners.

One source familiar with the company said that “extensive work” has been done at various stages of completion with the interested buyers.

“We’re talking about meetings with dozens of people involved,” said the person, who also was not authorized to speak publicly about the discussions.

(Reporting by Laura Isensee; Editing Bernard Orr)

Thin-film share of solar market to double – report

Tue Nov 10, 2009 5:06pm EST

* Thin film to account for 31 pct of solar panels in 2013

* Technology had 14 pct market share in 2008

* Research says First Solar established market viability

LOS ANGELES, Nov 10 (Reuters) – Solar panels that use thin-film technology in place of traditional silicon-based materials will more than double their share of the solar panel market by 2013, according to a report issued on Tuesday by industry research firm iSuppli.

Thin-film panels, such as those made by First Solar Inc (FSLR), the largest U.S. solar power company, are cheaper to make per watt of electricity than are standard panels.

The average thin-film solar panel price is expected to decline nearly 18 percent in 2010 to $1.40 per watt, iSuppli said. Average prices for silicon-based panels are expected to drop 20 percent to $2.00 per watt in 2010.

Panels than employ thin-film technology are expected to claim 31 percent of the global solar panel market by 2013, up from 14 percent in 2008.

“The market viability of thin film has been solidly established by First Solar Inc as it rockets to become the world’s top solar panel maker this year, with more than a gigawatt of production,” said Greg Sheppard, chief research officer for iSuppli in a statement.

Most solar panels, like those made by Suntech Power Holdings Co Ltd (STP) and California-based SunPower Corp (SPWRA, SPWRB), rely on polysilicon as a key raw material, while thin-film panel makers use a variety of different materials to turn sunlight into electricity.

Sheppard added that First Solar has driven its cost of production to less than 90 cents per watt, keeping its costs at about half the level of its competitors that use silicon-based technology.

Thin-film panels’ cost advantage has helped attract Japan’s Sharp Corp to expand into the thin film market. Solar equipment suppliers, such as Applied Materials Inc (AMAT) and Swiss technology group Oerlikon’s solar arm, are ramping up in thin-film space as well.

(Reporting by Laura Isensee; Editing by Steve Orlofsky)

Energy Conversion posts second straight loss, shrs dip

Mon Nov 9, 2009 1:17pm EST

* Q1 shr loss $0.28 vs EPS of $0.27 last yr

* Q1 sales more than halve, way below Wall St view

* Sees price declines, sequentially flat shipments in Q2

* Says prior FY rev outlook no longer applicable

* Shares down 4 pct

By Adveith Nair

BANGALORE, Nov 9 (Reuters) – Energy Conversion Devices Inc (ENER) reported its second straight quarterly loss, with sales coming in below estimates as demand for its solar products remained soft, and warned that prices would continue to fall.

On a conference call with analysts, the company said average selling prices, down 13 percent in the fourth quarter, would continue to decline in the December quarter.

“Our current estimate is we think high single digits to just around double digit decline would be appropriate,” a company executive said.

Like others in the solar industry, the Rochester Hills, Michigan-based company has been hurt by a dearth of financing and a global oversupply of solar panels that sent prices on solar power products tumbling.

ECD, which reported five consecutive profitable quarters before two back-to-back quarterly losses, makes lightweight, flexible solar laminates for rooftops and buildings that convert sunlight into electricity.

The company also indicated that visibility remained poor.

“At this time, our project business is uneven with large discreet orders where the shipments and timing of revenue recognition are difficult to precisely forecast. As a result, our prior full year revenue production is no longer applicable,” Chief Financial Officer Harry Zike said on the call.

First Solar buys 117 MW project from solar startup

Wed Nov 4, 2009 8:39pm EST

* Solar thermal co Ausra started project in 2007

* Financial terms not disclosed

* First Solar says deal to make way for other project

LOS ANGELES, Nov 4 (Reuters) – Solar industry bellwether First Solar Inc (FSLR) said on Wednesday that it bought a 117 megawatt project in California from Kleiner Perkins-backed solar thermal start-up Ausra Inc, a move that could speed up another 550 MW project in First Solar’s pipeline.

The companies did not disclose the financial terms.

Ausra, which is also backed by Khosla Ventures, said that the sale of the project — called Carrizo Energy Solar Farm — follows its strategy to move away from developing solar projects and focus on supplying large-scale solar steam generators.

“The sale of Carrizo is another step in executing our plan,” said Tom Bartolomei, senior vice president of business development at Ausra, in a statement.

Ausra landed a power purchasing agreement with California utility PG&E (PCG) two years ago for the project, located in San Luis Obispo County. That agreement was withdrawn as part of the sale, the company said.

First Solar can use the newly acquired land to revise the layout of the larger 550 MW Topaz Solar Farm project, which has run into “concerns such as farmland conservation and wildlife needs,” said Kathryn Arbeit, who oversees Topaz.

Both projects include land near each other in San Luis Obispo County.

Shares of First Solar closed down 2 percent at $121.59 on Wednesday on the Nasdaq.

(Reporting by Laura Isensee; Editing by Steve Orlofsky)

SolarWorld keeps 2009 outlook, Q3 weak

Wed Nov 4, 2009 8:20am EST

* Confirms 2009 sales outlook of 1 bln eur

* Q3 EBIT 34.7 mln eur vs 38 mln eur estimate

* Company had to fend off 25 pct price slump

* Shares up 1.5 percent vs FTSE clean tech index up 0.8 pct

By Christoph Steitz

FRANKFURT, Nov 4 (Reuters) – SolarWorld on Wednesday reaffirmed a full-year sales target of 1 billion euros ($1.47 billion) despite cutting prices by a quarter and missing third-quarter operating earnings forecasts.

Germany’s No.3 solar company reported third-quarter sales at 232.5 million euros and earnings before interest and tax (EBIT) amounted at 34.7 million. Analysts in a Reuters poll on average expected sales of 270 million and core earnings of 38 million.

Overcapacity of solar cells and modules has led to massive price declines, bringing growth in the once-booming sector to a near standstill at a time when companies have huge difficulties finding funding for cash-intensive solar projects.

“We had to stave off a price fall of 25 percent,” SolarWorld Chief Executive Frank Asbeck, sometimes called the “Sonnenkoenig” (Sun King), told Reuters, adding that some of it was offset by cost cuts.

SolarWorld’s shares rose 1.5 percent by 1224 GMT, outperforming the FTSE clean tech index .FTET50, which gained 0.8 percent.

SolarWorld has survived the downturn better than its peers, countering massive price declines for cells and modules by making everything from components to panels.

FILTER THROUGH

But analysts have warned it was only a matter of time before the price slump would filter through to players that are active in more than one part of the solar value chain.

Larger Norwegian rival Renewable Energy Corporation ASA (REC) — which had sales of 6.480 billion Norwegian crowns ($1.11 billion) in the first nine months of 2009 — said last week overcapacity in the industry would continue into next year. It missed third-quarter forecasts.

Yet in some regions it spotted early signs of improved demand for modules, a slightly more optimistic view than U.S. bellwether First Solar (FSLR) gave last week.

The question is now whether SolarWorld will be able to meet its 1 billion euros sales target.

“This seems aggressive as it is based on record sales of 366 million euros in the fourth quarter,” SES Research analyst Karsten von Blumenthal wrote, keeping a “buy” rating.

Societe Generale analyst Didier Laurens, also with a “buy” rating on the stock, wrote that the company’s existing inventory should enable the group to meet its sales target.

Analysts in a Reuters poll expect on average full-year sales of 976 million euros.

(Additional reporting by Anneli Palmen in Duesseldorf)

Q-Cells ends LDK supply agreement, claims guarantee

Mon Nov 2, 2009 2:51pm EST

* Q-Cells to apply to draw on bank guarantee

* LDK disputes Q-Cells claims, says will defend itself

* LDK shares tumble 20 pct; Q-Cells down 2.5 pct

By Christoph Steitz and Laura Isensee

FRANKFURT/LOS ANGELES, Nov 2 (Reuters) – Germany’s Q-Cells ended an agreement with its Chinese solar wafer supplier, LDK Solar (LDK), a sign that the solar industry is continuing to struggle with an oversupply of materials.

Q-Cells, one of the world’s largest makers of solar cells, said on Monday that LDK did not fulfill “significant contractual obligations” in a 10-year agreement to supply wafers to Q-Cells. The companies entered the contract when wafer prices were much higher.

LDK, whose shares dropped 20 percent on Monday, said in a statement that it “vigorously disagrees” with Q-Cells’ claims and plans to defend itself against what it called a wrongful termination.

The move comes as manufacturers of solar cells and panels around the world are struggling with oversupply that has driven down prices and curbed demand.

Prices for polysilicon — a key raw material for the solar industry — and for solar panels have tumbled dramatically in the last year, forcing many players to renegotiate contracts.

“People are coping with oversupply and companies are learning that long-term contracts don’t mean much in a down cycle,” said Oppenheimer & Co analyst Sam Dubinsky.

Q-Cells said in a statement that “the contractual parties have differing opinions concerning the validity of the termination of the agreement” and its plans to reclaim a $244.5 million prepayment it made in 2008 related to the agreement.

“Discussions between the two companies and a parallel arbitration process at the International Chamber of Commerce (ICC) in Paris have not resulted in an amicable settlement yet,” the company added.

Solar power execs bullish on 2010 despite earnings

Thu Oct 29, 2009 7:36pm EDT

* Execs with Suntech, BP Solar, others see growth in 2010

* Driven by government aid, improved financial markets

* See fall in panel prices stabilizing

By Laura Isensee

ANAHEIM, California, Oct 29 (Reuters) – Executives from solar power companies see clearer skies in 2010 for the beleaguered industry, even as quarterly reports from heavyweights like First Solar Inc. (FSLR) and SunPower Corp (SPWRA, SPWRB) have disappointed investors and dragged down shares.

The industry has struggled to emerge this year from tight credit markets, a global glut of panels and falling prices.

“I think we’re already in the middle of a turnaround. We’ve kind of gone through the low point of the recent past,” said Steven Chan, Suntech Power Holdings Co Ltd’s (STP) chief strategy officer, in an interview with Reuters.

Executives from Sharp Corp, BP’s (BP) solar unit and other solar power players shared similar optimism about the sector’s outlook in 2010 at the Solar Power International conference being held in Anaheim, California, this week.

“Demand’s really good going into 2010. Visibility is a hell of a lot better than it was coming into 2009,” SunPower’s chief executive Tom Werner told reporters at the conference.

The industry, which grew at a clip of more than 40 percent for several years, has suffered in the recession, but solar companies kept a bullish attitude on growth next year.

Executives cited various forces that could drive growth in 2010, including U.S. stimulus funds for green projects, extended tax incentives and new financing.

First Solar Crushed; Merrill, Caris, Gabelli Downgrade

By Eric Savitz
barrons.com

First Solar (FSLR) shares are getting absolutely crushed today, after a disappointing Q3 earnings report and weaker Q4 guidance. The combination triggered some extremely bearish Street commentary, and spurred at least three analysts to issue downgrades.

* Bank of America/Merrill Lynch analyst Steven Mliunovich cut his rating on the stock to Neutral from Buy, with a new price target of $135, down from $180. He chopped his 2010 EPS estimate to $7.22, from $6.25. “It’s difficult to see upside catalysts given concerns regarding pricing and the German feed-in tariff along with the company’s limited ability to increase production if demand surprises on the upside.,” he writes. “We see four quarters of year-over-year earnings declines, not typically good for stock performance.”

* Caris & Co. analyst Ben Pang cut his rating to Above Average from Buy, and reduced his target to $162 from $205. He says that “earnings leverage is trending below our expectations…as pricing erosion and potential tariff changes will continue to pressure margins.” He says FSLR is likely go gain share, but that multiple expansion is unlikely unless the company can deliver higher efficiencies or better margins.

* Gabelli & Co. analyst Hendi Susanto downgraded the stock to Hold from Buy, noting that the pricing outlook is uncertain given a potential FIT reduction in Germany and competition with silicon-based providers. Susanto says the reduced rating reflects “narrowing margin and concern about impact of FIT reduction and further pricing competition with crystalline silicon modules.”

Meanwhile, Pacific Crest analyst Mack Bachman writes that press reports that the revenue miss reflects a revenue recognition push-out from a single project are wrong. “The revenue miss was due to a lack of module sales despite management giving away more than $60 million in price concessions in Q3,” he writes. “We are concerned that the rebate did not create demand.” His advice: “Put money to work elsewhere.”

FSLR today is down $22.96, or 15.2%, to $128.62

First Solar shares plunge on 3Q revenue miss

First Solar shares plunge sharply on 3rd-qtr revenue miss, but analysts remain bullish

2:57 pm EDT, Thursday October 29, 2009

NEW YORK (AP) — Shares of First Solar Inc. (FSLR) tumbled Thursday after the nation’s largest solar panel maker reported third-quarter revenue far below analyst expectations, even though analysts remained bullish on the company.

First Solar shares plunged $22.69, or 15 percent, to $128.89 in afternoon trading. The stock has traded between $85.28 and $207.51 over the past year.

Late Wednesday, the company reported a 55 percent leap in third-quarter earnings on a 38 percent increase in revenue. But sales of $480.9 million missed the average analyst estimate of $528.8 million, as measured by a Thomson Reuters survey.

The company said its Sarnia project in Canada is about 65 percent complete. Although all modules produced during the quarter were shipped, about $58 million in revenue won’t be recognized until the fourth quarter, the company said.

“This is truly a timing issue,” Chairman Mike Ahearn said on a conference call with analysts. “That project has been sold, the contract wasn’t signed until early in the fourth quarter. We remain on track for annual guidance.”

“Don’t sweat the revenue miss,” said John Roy, an analyst with Janney Capital Markets. He reiterated a “Buy” rating and $185 share price target.

“While the lower revenue was a slight disappointment, we do not view it as a cause for concern and believe it will be made up in the fourth quarter,” Roy said in a note to clients. He added that the results do not change his view that First Solar should remain the low-cost industry leader for the foreseeable future and will likely gain share value in large-scale projects.

Lazard Capital Markets analyst Sanjay Shrestha said First Solar’s pressured share price presents an opportunity to buy up shares at a discount. He reiterated a “Buy” rating and $190 price target.

Jefferies & Co. analyst Paul Clegg said First Solar is positioned to generate greater cash flow returns than its peers, and he can hardly imagine a market scenario where that is not the case.

“We believe that First Solar’s cost structure will remain the lowest in the industry even if silicon prices continue to decline,” Clegg said as he maintained his “Hold” rating and $130 price target.

First Solar falls 17%, but analysts calm

NEW YORK (MarketWatch) — First Solar (FSLR) fell 17% to $126.60 on Thursday after the thin film solar panel maker weighed in with its earnings. Analysts at Jefferies said First Solar missed its revenue target due to $58 million in sales that will be recognized in the fourth quarter. Jefferies reiterated its hold rating and price target of $130 a share. “We believe that First Solar’s cost structure will remain the lowest in the industry even if silicon prices continue to decline,” analysts said.

Lazard Capital Markets reiterated its buy rating on the stock. “With shares under pressure on revenue deferral into fourth quarter and concern surrounding margin guidance, which simply reflects a higher mix of system business, we encourage accumulating positions on this weakness,” Lazard analysts said.

First Solar reports profit growth, but revenue disappoints and shares fall

11:24 pm EDT, Wednesday October 28, 2009

TEMPE, Ariz. (AP) — First Solar Inc. (FSLR), the nation’s largest solar panel maker, said on Wednesday that its third-quarter profit jumped almost 55 percent on higher revenue. But revenue fell well short of analyst expectations because of a contract that wasn’t signed until the current quarter, sending shares tumbling in late trading.

The company said it earned $153.3 million, or $1.79 per share, for the quarter that ended Sept. 26. That was up from $99.3 million, or $1.20 per share, during the quarter that ended Sept. 27, 2008.

Revenue rose 38 percent to $480.9 million from $348.7 million a year earlier.

Profit topped the $1.74 per share that analysts surveyed by Thomson Reuters were expecting, but revenue was shy of the $528.8 million average estimate.

The company said its Sarnia project in Canada is about 65 percent complete. Although all modules produced during the quarter were shipped, about $58 million in revenue won’t be recognized until the fourth quarter, the company said.

“This is truly a timing issue,” Chairman Mike Ahearn said on a conference call with analysts. “That project has been sold, the contract wasn’t signed until early in the fourth quarter. We remain on track for annual guidance.”

First Solar also said revenue fell from the second quarter because reduced pricing driven by its rebate program, foreign exchange fluctuations and the fact that the second quarter benefited from $27 million of deferred revenue from another project.

First Solar said market demand is seasonally stronger, and inventories have been reduced. The company now forecasts full-year revenue of $1.97 billion to $2.02 billion, in line with analysts’ average forecast of about $2 billion.

The company’s shares fell $24.08, or nearly 16 percent, to $127.50 in aftermarket trading, after closing up $1.36 at $151.58 before the results were released.

FSLR: Sees Q4 Margin Erosion

By Tiernan Ray
barrons.com

During a conference call with analysts this evening, management of solar energy technology vendor First Solar (FSLR) talked folks through the revenue miss in the third quarter that pushed shares down over 15% this evening.

The dip in revenue from $525 million in Q2 to $480 million in Q3, below analysts’ estimates, was because of a single order that were “not able to be recognized” — in other words, implying cash collected but not able to be recorded on the income statement within the quarter. The company did not make clear when that revenue will be recognized.

In addition to the revenue miss, analysts will be pouring over the gross margin implications. The company said that a rebate program initiated last quarter to goose solar investment knocked down gross profit. Indeed, gross profit as a percentage of sales fell from 57% in the second quarter to 50.9% last quarter.

That’s going lower in the current quarter, management said, to a range of 41% to 44%. The company said it saw a big uptake of the rebates and purchases qualifying for the rebates, and that the rebate policy would continue in Germany as the pricing of silicon-based solar panel technology was “much more competitive” at present than in past. About the only good news on rebates and margins was that the company does not expect to extend its rebate plan outside of Germany.

As for recent speculation about whether Germany will reduce subsidies for solar technology purchases, company management said it’s “difficult to handicap where that is going to come out.”

First Solar, Inc. Announces 2009 Third Quarter Financial Results

Fiscal 2009 Revenue Guidance Expected at the High End of the Prior Guidance Range

4:03 pm EDT, Wednesday October 28, 2009

TEMPE, Ariz.–(BUSINESS WIRE)–First Solar, Inc. (FSLR) today announced its financial results for the third quarter ended September 26, 2009. Quarterly revenues were $480.9 million and excluded the Sarnia project, which was over 65% completed at quarter end. Revenues were $525.9 million in the second quarter of fiscal 2009 and $348.7 million in the third quarter of fiscal 2008.

Revenues for the first nine months of fiscal 2009 were $1,424.9 million compared to $812.7 million for the first nine months of fiscal 2008.

Net income for the third quarter of fiscal 2009 was $153.3 million or $1.79 per share on a fully diluted basis, down from $180.6 million or $2.11 per share on a fully diluted basis for the second quarter of fiscal 2009 and up from $99.3 million or $1.20 per share on a fully diluted basis for the third quarter of fiscal 2008.

The Company has also posted its Earnings Call Presentation, which includes updated guidance for fiscal 2009 on the Company’s web site. The Company expects full year fiscal 2009 revenue at the updated guidance range of $1.975 to $2.025 billion, which is at the high end of the previously provided guidance range.

First Solar will discuss these results and outlook for fiscal 2009 in a conference call scheduled for today at 1:30 p.m. MST (4:30 p.m. EDT). Investors may access a live audio webcast of this conference call or the Earnings Call Presentation in the Investors section of the Company’s web site at www.firstsolar.com. An audio replay of the conference call will also be available approximately two hours after the conclusion of the call. The audio replay will remain available until Monday, November 2, 2009 at 11:59 p.m. EDT and can be accessed by dialing 888-203-1112 if you are calling from within the United States or 719-457-0820 if you are calling from outside the United States and entering access code 1744958. A replay of the webcast will be available on the Investor section on the Company’s Web site approximately two hours after the conclusion of the call and will remain available for 90 calendar days. If you are a subscriber of FactSet and Thomson One, you can obtain a written transcript within two hours.

Solar Stocks Ready For A Big Move

Posted: Oct 26, 2009 16:19 PM by Joey Fundora

The solar stocks continue to be one of the more volatile groups in the markets. Traders often fear high levels of volatility, but if these are properly planned for, volatile stocks can offer outstanding trading opportunities. The solar stocks have been in a large range over the past year, and many of these stocks actually set their lows in November rather than March. This group has often been cited by the current administration as a focal point in helping to reduce the U.S. dependence on oil-rich countries, and while it has threatened to fall apart several times, it has continually found a floor.

This group is once again under pressure as a poor earnings report from SunPower Corporation (SPWRA, SPWRB) kicked off this earnings season, as the markets reacted poorly to the company’s guidance number. While this stock individually came under pressure, as a group there wasn’t major technical damage done. In looking at the Claymore/MAV Global Solar Energy Index ETF (TAN), which can be used as a proxy for the sector, you can see that TAN held up last week, despite the weak report by SPWRA. In looking at the chart, there is an interesting pattern developing. Overall, TAN remains in a trading range, but it was able to clear a descending wedge in September, and is currently trading in a small symmetrical triangle. Both of these patterns are simply consolidation patterns, but with TAN clearing the first to the upside, it may hint at a break to the upside from the second pattern as well. The descending trendline touching the last two price highs should be watched as a level of importance.

Source: StockCharts.com

The largest component in TAN is First Solar, Inc. (FSLR). With FSLR reporting on Wednesday, it could be the catalyst for a move in either direction for the group. The company’s last earnings report was met with steep selling, as FSLR pulled back from $176.05 to $112.09 in a few weeks’ time. FSLR did stabilize, and rallied back to a declining trendline, marking the tops of prior rally attempts. It recently cleared this trendline, and it continues to trade in a tighter consolidation leading into the earnings report. More than likely, FSLR will have a large move this week, but with earnings coming out, which direction it’s headed is anyone’s guess. However, this stock will likely impact the entire sector, so it is worth watching to help gauge the direction for the next quarter.

Source: StockCharts.com

Energy Conversion Devices, Inc. (ENER) is another solar that has been showing weakness for a few months, but recently cleared a declining trendline that halted recent rally attempts. It just cleared this area, and has been experiencing an uptick in volume. Earnings are not due until November, so this is a stock that could benefit from a positive FSLR report. A move above $13.62 could signal a test of $14.21 and possibly a test of the 200-day moving average near $16.

Source: StockCharts.com

Another stock worth watching is Yingli Green Energy (YGE). This stock has shown relative strength compared to its peers, and has been in a consolidation pattern for a few months. It’s currently looking a little weak, and is resting on its 50-day moving average, but if it can get back over $13.85 it could be ready for a test of the June high near $16.35.

Source: StockCharts.com

Bottom Line
The solar stocks could really go in either direction at this point, but they are worth watching with FSLR reporting this week. They often set the trend for this group, and there could be some great trading opportunities setting up. The levels noted in the charts above are starting points for watching the action objectively. Regardless of the headline news or numbers, the important thing to watch is what the stock price does moving forward. If any of these stocks starts to climb above key levels, there is a good chance they can experience a sharp rally. If they start to lose these levels, the opposite would hold true. With volatile groups like these, it’s worth watching regardless of which direction the move goes.

Solar: German Subsidy Update

By Tiernan Ray
barrons.com

Analysts this morning are parsing the fine print of a four-year coalition agreement ratified in Germany today that will likely have an impact on funding for solar technology projects, and on solar technology vendors such as First Solar (FSLR) and SunPower (SPWRA, SPWRB).

As Bloomberg notes, German Chancellor Angela Merkel’s Christian Democratic Union pushed through measures for a $36 billion tax cut meant to spur economic growth, a compromise with more aggressive proposals. The measures relating to solar funding appear vague and thus open to widely differing interpretations.

The agreement does not call for immediate cuts in the so-called feed-in tariff for solar projects, subsidies that have helped boost German investment in the technology, writes Collins Stewart analyst Dan Ries. The agreement “highlights that the coalition is committed to solar and indicates that the government will pursue a dialog with the solar industry and community leaders to determine if the current subsidy is too generous.”

Ries is optimistic, writing that “we do not believe the outcome will be as harsh as the “enormous” one-time cut of perhaps 20-30% reported in the press.”

Hapoalim Securities analyst Gordon Johnson, on the other hand, believes cuts to subsidies won’t be “less severe,” as Ries and others believe. In fact, “we see this as confirmation that Merkel’s new coalition sees an immediate need to adjust current incentives for solar PV technologies,” he writes. “Furthermore, there was mention of focusing incremental ground based solar PV systems on “sealed” land – our discussions with contacts in Germany this morning suggest this could materially limit the sites new free-field solar projects in Germany can be placed.”

But as Johnson notes, it’s possible that a future limiting of subsidies will have a positive near-term impact on demand, causing projects to rush to use existing subsidies. But Johnson believes this will be small comfort given what he argues is an industry-wide glut of polysilicon (the raw material for many solar devices), solar wafers, and photovoltaic cells and modules, “we see acute risk of industry wide multiple compression on the horizon.”

The effects of the a potential tariff cut have already begun to be felt by some vendors. SunPower, for example, last Thursday offered a disappointing Q4 revenue outlook, which some analysts attributed to orders being pulled into last quarter from the current quarter, as projects scrambled to buy panels before tariffs run dry.

Sunpower shares today are down 90 cents, or 3%, at $27.45, while First Solar’s stock is up $2.51, or 1.7%, at $154.90.

Largest solar panel plant in US rises in Florida

Largest solar panel plant in US soaks up rays in sleepy Florida town

By Christine Armario, Associated Press Writer
4:59 pm EDT, Friday October 23, 2009

ARCADIA, Florida (AP) — Greg Bove steps into his pickup truck and drives down a sandy path to where the future of Florida’s renewable energy plans begin: Acres of open land filled with solar panels that will soon power thousands of homes and business.

For nearly a year, construction workers and engineers in this sleepy Florida town of citrus trees and cattle farms have been building the nation’s largest solar panel energy plant. Testing will soon be complete, and the facility will begin directly converting sunlight into energy, giving Florida a momentary spot in the solar energy limelight.

The Desoto Next Generation Solar Energy Center will power a small fraction of Florida Power & Light’s (FPL) 4-million plus customer base; nevertheless, at 25 megawatts, it will generate nearly twice as much energy as the second-largest photovoltaic facility in the U.S.

The White House said President Barack Obama is scheduled to visit the facility Tuesday, when it officially goes online and begins producing power for the electric grid.

As demand grows and more states create mandates requiring a certain percentage of their energy come from renewable sources, the size of the plants is increasing. The southwest Florida facility will soon be eclipsed by larger projects announced in Nevada and California.

“We took a chance at it and it worked out,” said Bove, construction manager at the project, set on about 180 acres of land 80 miles southeast of Tampa. “There’s a lot of backyard projects, there’s a lot of rooftop projects, post offices and stores. Really this is one of the first times where we’ve taken a technology and upsized it.”

Despite its nickname, the Sunshine State hasn’t been at the forefront of solar power. Less than 4 percent of Florida’s energy has come from renewable sources in recent years. And unlike California and many other states, Florida lawmakers haven’t agreed to setting clean energy quotas for electric companies to reach in the years ahead.