Neo Solar Power Corp (新日光能源), the nation’s biggest solar cell maker by shipment, expected demand to recover in the fourth quarter, but severe oversupply would continue to weigh down prices, a company executive said yesterday.
Most solar companies reported losses last quarter and some US companies filed bankruptcy protection last month, because the debt crisis in Europe and the faltering US economy have dampened demand as European governments cut back on green energy subsidies as part of their austerity measures and banks significantly raised their lending thresholds.
“The worst is over. The second quarter has been the trough. Demand will recover in the fourth quarter,” Neo Solar chairman Quincy Lin (林坤禧) told a media briefing yesterday at the launch of the annual photovoltaics trade show, dubbed PV Taiwan, in Taipei.
“However, we are not expecting prices to bounce back because supply still greatly exceeds demand. Some companies will fail to survive [the slump], which will, to some extent, improve [the] oversupply [situation],” Lin said.
Supply surpassed demand by more than 50 percent at present, he added.
Overproduction has driven solar cell module prices down about 33 percent last month from a year ago, market researcher Solarbuzz said in a report dated Sep. 28.
Price cuts have started to stimulate second-half end-market demand, but to date this has occurred more slowly than expected, the researcher said.
Neo Solar, based in Hsinchu, swung into a loss of NT$1.06 billion (US$34,595 million) in the second quarter, from a net profit of NT$304 million (US$9.92 million) in the first quarter.
Davis Chen (陳思銘), chairman of Win Win Precision Technology Co (有成精密), which installs solar units for other companies, said Italy suffered the brunt of the sovereign debt crisis as banks lowered the lending cap to 70 percent from 90 percent.
However, Lin held an optimistic outlook for the next few years. He expects the uptake of solar energy would speed up in 2014, when the costs of installing solar panels would be 20 percent lower than installing electricity from the grid.
Solar energy costs are expected to lower to the same price as grid power next year.
“Demand will take off after the costs to install solar panels becomes lower than that of the electricity grid, meaning demand for the green energy will no longer depend on government subsidies,” Lin said.
The stock price of Neo Solar advanced 2.06 percent to NT$29.7 yesterday, while that of E-Ton Solar Tech Co (益通光能) dropped 0.98 percent to NT$15.15 and Motech Industries Inc (茂迪) saw its shares plunge 3.7 percent to NT$49.5.
The Chinese-language Economic Daily News reported yesterday that Motech would extend its second-quarter losses into the second half, with a full-year loss of NT$397 million.
Motech said in a filing to the Taiwan Stock Exchange that it did not provide the figures that were published to the newspaper or any other source.
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