SAN RAFAEL ¨C Marin Solar, a former electrical contractor who switched to the solar energy business five years ago, is riding an unprecedented surge in the industry...
Projected sales for 2007 are $17 million.
The company, like several others in the North Bay, has benefited from recent pro-solar legislation in Sacramento and, more significantly, increasing investment by semiconductor companies in polysilicon, the stuff of photovoltaic cells.
"We started the year with a reserved $9.1 million in sales, and the increased availability of solar panels will easily allow us to nearly double last year's figure," said Tyson Grul, president of sales, finance and marketing for Marin Solar.
California's solar industry has been growing steadily, with most developers, suppliers and installations in the northern part of the state.
"They have more sun in the south, but we have the pro-solar mindset in the north. We were developing and using it before it was considered a viable alternative to PG&E," said Mr. Grul.
"That's why Marin Solar and other North Bay solar companies are now in position to reap the benefits."
But the industry hit a bottleneck about five years ago when demand for solar panels jumped sharply in Germany ¨C where the industry is heavily subsidized ¨C and Japan.
The semiconductor industry was taken by surprise and wasn't prepared to answer the demand. Fabrication plants take several billion dollars and at least two years to build.
North Bay solar panel and systems providers like Marin Solar, SPG in San Rafael, Solar Depot in Petaluma and SolarCraft in Novato were taking orders for residential and commercial systems but had to scramble for the panels.
Incentives keep demand high
Last year's extension of the state tax rebate for solar installations, with $3.1 billion allocated to the initiative over a 10-year period, was welcomed by the industry.
Also encouraging was a provision which raises the cap on net metering, the solar electricity which can be sold back onto the grid, from .5 percent to 2.5 percent of a utility's total electricity sales. PG&E was within weeks of refusing further sell-back installations.
"And now we're working on the Federal level to do away with the cap that limits the 30 percent federal installation rebate to installations at or under $2,000," said Mr. Grul. "That will lead to larger installations."
But legislative incentives can lead to customer frustration when a long wait for panels precedes a rebate. Last year, when the enactment was made in California, solar providers worried that new ways to build solar cells without semiconductor technology wouldn't be available for several years.
Now it appears the semiconductor industry has woken up to the opportunities of solar.
"The turning point came when the demand for solar cells outgrew the demand for chips," said Julie Blunden, vice president of public policy and corporate communications for SunPower Corporation, a major systems manufacturer that was acquired by Cypress Semiconductor in 2004.
Last year SunPower, known for its high efficiency solar panels, acquired PowerLight, the Berkeley-based maker of large-scale solar power systems. Publicly-traded SunPower is now a major supplier among a surge of new suppliers, both public and private.
"They're the best, in my opinion," said Mr. Grul. "Their systems operate at peak efficiency even on the most difficult of roof lines."
More panels on the way
In 2005, the industry saw investors come in at every level on the supply chain, said Ms. Blunden.
"Those investments are showing up now, and investments currently being made will show up two year from now."
SunPower has increased the capacity of its poly plant in the Philippines from two to four lines. A second, 10-line plant is slated to open in the third quarter of 2007.
"These are pure play solar plants. They don't manufacture chips," she said.
The semiconductor industry, threatened by the potential for new, non-silicon solar technologies, is united in its goal to bring the cost of the systems down until they match electricity prices.
They're still 20 percent to 50 percent higher, depending on whether you factor in different energy costs in different states, and the time it takes to pay off a system with or without rebates, according to Ms. Blunden.
"Once the semiconductor industry matches those prices, and the time is drawing near, then solar will be the energy source of choice everywhere it can be used," she said.