By Paul Buckley

Being a CEO of a solar panel producer is also fast becoming a career move to be avoided. Here's why:

The price of polysilicon has fallen swiftly on the spot market in recent months, dropping to about $200 per kilogram from $450 to $500 earlier in 2008. Analysts predict spot prices to sink below $100 by the end of 2009 and to a $50 to $80 range in 2010. That's roughly the same levels as prices in long-term contracts.

The plunge in polysilicon prices shows a dramatic reversal in the cost situation solar panel makers have faced during past four years. During that period polysilicon prices have surged and would-be buyers often found it difficult to source enough product.

On the face of it the drop in the cost of polysilicon is good news for the solar cell makers because the raw material is the single biggest expense in making a solar module, accounting about half of the costs.

However, any cost relief is going to be offset by the slowdown in demand for solar products resulting from the global credit crunch.

Increased polysilicon production capacity worldwide will switch the shortage in polysilicon into an excess by 2010. In 2009 the global supply of polysilicon is set to double and is expected to outpace demand growth. Within two years, supply will outstrip demand and will widen further by 2012.

Even though demand will continue to keep growing until 2011, it simply won't keep up with the supply side of the equation.

The collapse in polysilicon prices fueled by the release of new output is going to force consolidation among the 70 or so producers of the raw material.

There is already major pressure around the world to renegotiate polysilicon contracts and it is going to weigh on margins at the established polysilicon manufacturers such as MEMC, Germany's Wacker Chemie AG and Norway's Renewable Energy Corp .

To add to the solar panel maker's woes it seems that up to 80 percent of solar projects are financed by banks and institutional investors. Solar panel producers rely on credit to ensure their customers can place new orders. A credit crunch is just not what the doctor ordered. Although panel prices have been rising for the first nine months of this year they are now on track to fall as much as 15 percent in the fourth quarter.

In a sign of things to come, Suntech slashed its revenue forecasts for the fourth quarter, citing the euro's sudden fall against the dollar and delayed orders by customers who had trouble getting project financing.

In the past couple of years solar manufacturers have been forced to enter into five-year contracts with polysilicon producers at high prices to ensure raw material supplies. So now we find many of those companies busily trying to renegotiate the contracts to reflect the lower price of polysilicon.

So headaches galore for the CEO of a solar panel producer and no doubt for their employees and component suppliers too.

Here is one last point. Back in May 2006 EETimes reported the following: The contract price of polysilicon has soared 80 percent in the last 18 months to $60/kg, and we anticipate further increases to $80/kg in 2006 and more in 2007.

So the price of polysilicon has soared and crashed. By 2010 the price is likely to be in the $50 to $80 range. Sounds familiar?

By Paul Buckley

Two historic events are expected to take place this week on opposite sides of the planet that are likely to have a profound effect on the future prospects of global power management markets.

If the results of the two events go one way they should provide a major injection of 'energy' into the growth rate of the twin driving forces of the power management sector - batteries for electric vehicles and solar cell developments.

The first event is a political one. The U.S. Presidential election could prove a key stimulus to the growth of the global solar cell industry.

The second event could see Panasonic buying Sanyo which will create a global 'battery superpower' that could dominate the next generation of electric cars and portable electronic devices.

An EE Times poll of readers last week revealed strong support for Sen. Barack Obama to be the next U.S. president. However, the results from a separate reader survey seeking to gauge key issues for engineering in the 2008 election was perhaps more surprising. While, rather predictably, 60 percent of those polled expressed concern about the economy the second highest priority (21 percent) was logged as being development of sustainable energy sources.

The level of interest in sustainable energy from Americans was something of a shock to this European at least. But it does go to show that some sections of the USA are finally beginning to realize that fossil fuels do have their limitations after all and that a change in energy strategies is vital for future prosperity.

Given that Obama has made 'Change' the core theme of his election campaign it is not surprising that he is expected to support research and investment in solar cell developments and electric car technology more strongly than McCain.

Over in the Far East the Panasonic-Sanyo deal would give Japan a major player in a market that Korea and China have been threatening to dominate.

This week Panasonic is believe to be negotiating to buy a controlling stake in Sanyo from the three leading banks that rescued the company a couple of years ago. The trio of shareholders that owns the stake comprises Goldman Sachs, Sumitomo Mitsui Banking Corporation and Daiwa Securities SMBC.

Panasonic is thought to have amassed a cash war chest of more than £6.2 billion and the Credit Crunch has made the banking sector hungry for cash so a deal is on the cards for later this week.

If Panasonic acquired Sanyo it would immediately see the company secure leadership of the high-growth area of lithium-ion batteries.

Under the influence of the three banks Sanyo has sold many non-core assets and been re-fashioned as a battery and solar energy specialist. Sanyo is also among the world's top ten players in photovoltaic (solar) technology. At the moment Panasonic has a little solar technology in its product portfolio.

Recessions are often periods when certain companies can readily capture market share if they get their strategies and timing right. Panasonic obviously recognizes the opportunity. The company's second quarter profits may have dropped by 16 per cent but it did not cut its full year forecasts or capital expenditure plans. The deal may be agreed this week but is not likely to be completed until April 2009.

So an Obama win and the Panasonic deal being given the go-ahead look like giving the global power management sector a twin turbo boost as we enter 2009. That is hopefully also going to help stimulate growth in the European power management sector.

By Paul Buckley

In reality it is not a conspiracy theorist's plaything but a novel laser implant technique that claims to radically alter the photonic properties of semiconductor devices.

A highly light-absorbent material, black silicon claims to absorb nearly twice the visible light of regular silicon and detects infrared light that is normally invisible to silicon based devices, a capability that its developers claim will allow for dramatic performance enhancements in applications ranging from simple light detection to advanced digital imaging and solar energy.

Black silicon was actually discovered by Harvard University's Eric Mazur, Balkanski Professor of Physics and Applied Physics. And recently Harvard University's Office of Technology Development (OTD) and SiOnyx, Inc. announced that SiOnyx has exclusively licensed Harvard's portfolio of black silicon patents.

SiOnyx is producing devices that represent the first and only known, low cost, highly scalable platform for hyper-spectral imaging. The SiOnyx implant is compatible with established semiconductor manufacturing processes and introduces no new material. The company's patented process employs femtosecond laser processing of the target material resulting in a thin (300nm) photoconduction layer applicable to both biased (detection) and photovoltaic (power generation) applications.

The advocates of black silicon claim it could significantly increase the efficiency of modern solar panels. The majority of panels only convert around 8% of the energy falling on them into electricity. The top performers at best convert around 20%. The proponents of black silicon wafer have suggested that black silicon could push theoretical limits of photovoltaic cells and convert around 30 to 40 percent of the energy falling on it into electricity.

"Black silicon addresses the fundamental pain point in all photonics systems, the sensitivity to light," said Stephen Saylor, president and CEO of SiOnyx, Inc. "By demonstrating that the black silicon process cost effectively scales within the established semiconductor device manufacturing infrastructure, SiOnyx is poised to transform the $10bn+ light detection, imaging and photovoltaic markets by offering device manufactures a path to smaller, lighter and more efficient photonic systems."

Isaac Kohlberg, Harvard University's Senior Associate Provost and Chief Technology Development Officer, said: "The story of black silicon and SiOnyx is an excellent example of Harvard'' commitment to transfer promising, early-stage technology out of our research enterprise so it can be developed and utilized for the good of society."

Doesn't sound all that evil does it?

But look at it all from the conspiracy theorist's point of view. Black silicon is the result of Mazur's research that was originally funded by the Army Research Organization to explore catalytic reactions on metallic surfaces.

Then consider this statement made by Steve Saylor, chief executive of SiOnyx, who said: "We've been completely stealth, there hasn't been anything published about the company since its founding. We wanted to make sure we could scale the technology into a commercial foundry."

Add to that some of the performance claims made for the material have been somewhat confusing and you are well away down the road to X-File nirvana.

Top it off with bloggers starting to morph the name black silicon into the even more mysterious phrase 'dark silicon' and we have a fully fledged contender for Mulder and Scully to investigate.

By Paul Buckley

I wonder if last week you spent most of your time scratching your head trying to work out how to recover your losses in savings and pensions that seemed to be being eroded on an hourly basis.

Alternatively, like me you could have begun to ponder what the next bubble was that is going to burst and how to avoid it.

Unfortunately, a strong bubble popping contender could well be the solar power sector.

While all our eyes were staring at plunging share prices and banking meltdowns the world's No.4 solar cell maker, Kyocera, was predicting that 80 percent of the companies in the solar industry could fail when prices of solar panels fall below the cost of making them. Is another meltdown on the cards?

Last week the head of Kyocera's solar operations, managing executive officer Tatsumi Maeda, told a press conference that the Japanese company has been wary of expanding solar panel production, preferring to wait for technology advances to lower the cost of converting solar power into electricity.

Kyocera was the first company to mass-produce polysilicon solar cells in 1982 so their opinion is always worth listening to.

The Japanese group, which currently trails Germany's Q-Cells, Japanese rival Sharp Corp and China's Suntech Power Holdings Co Ltd, is facing growing price competition from its rivals, who have announced aggressive spending plans, pushing up the price of silicon, which is used to make most solar cells on the market.

According to Maeda the sector is in a bubble with many of the 200 or so solar power companies planning to ramp up capacity.

Demand for solar cells has soared on the back of higher oil prices and concerns over climate change. Government subsidies and incentives in various countries have helped inflate that bubble.

Maeda warned that: "The prices of solar panels need to fall to less than half of what they are now (for their use to spread without subsidies), and current technology doesn't make that commercially viable."

Premature investment in inefficient technologies was dangerous according to Maeda and he reckons the industry is in for large price falls.

Maeda said Kyocera is aiming to achieve grid parity - making the price of electricity households get from solar panels as cheap as conventional electricity - in five to six years.

Kyocera's rivals are counting on the production of thin-film solar cells to service the rising demand. The thin-film cells reduce production costs because they convert solar energy into electricity at a lower rate but use a fraction of the silicon needed by conventional solar cells.

Kyocera's existing solar modules currently convert 14 percent of solar energy into electricity and the company says it will not adopt thin-film technology until the conversion rate improves to 12 percent from the current levels of eight percent.

Are Kyocera being prudent or overly cautious?

The Japanese group is planning to more than double its solar cell output to 650 megawatts by March 2012. By comparison, the market leader, Q-Cells of Germany plans to ramp up capacity to 2,500 megawatts in 2010. So which company would you like to back to recoup your losses of recent weeks? Go the wrong way and you look like losing yet another shirt.

Well if you are Warren Buffett, one of the world's investment gurus, what would you do?

It seems the guru has already spoken.

Last week MidAmerican Energy Holdings Co., a subsidiary of Warren Buffett's Berkshire Hathaway, announced plans to invest about $230 million in BYD Co., a Chinese car and battery maker. BYD claims to be the world's largest maker of nickel and lithium-ion batteries for cell phones, counting Nokia, Motorola and Samsung among its customers.

However, it appears that what has sparked Buffett's interest is the Chinese company's battery developments for storing solar and wind power.