Some chin-stroking in Reuters about solar’s future: Prospects for the solar power sector are puzzling investors juggling on one hand a possible dotcom-style bust and on the other fresh support in Europe, home to a third of the world’s market.
The solar power industry uses the same silicon raw material as the semiconductor industry and may share a similar boom-bust path, according to some analysts. The semiconductor industry collapsed in 2000 amid a dotcom bust which pulled demand for electronic chips.
Solar companies saw their share prices skyrocket last year but many endured a steep fall in January, halving in the case of one market leader Oslo’s Renewable Energy Corporation. Such falls reflected a view that solar power valuations had run ahead of themselves. High profits plus low barriers to entry have attracted new manufacturers from China and the prospect of more serious over-capacity looms is now dividing opinions.
“Alternative energy and solar energy are a very compelling growth opportunity and that’s going to be a multi-decade phenomenon,” said Gunnar Miller, global co-head of Research at Allianz Global Investors (AGI). “It’s going to be something on a par with volume growth of flat panel screens, PCs and handy phones,” he said, while adding some companies had become over-valued.
,,,,Governments subsidise low carbon-emitting solar power as one plank in their fight against climate change, fuelling a boom especially in market-leading Germany. That has made manufacturers like China’s Suntech and LDK Solar and SolarWorld rich. Growth now is led by expanding markets such as in South Korea and Spain, France, Italy and Greece in Europe, after the introduction of new subsidies there….