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4 April 2007 - Higher demand for solar energy will drive annual revenues of the global solar equipment industry from $20bn last year to $90bn in 2010, according to a report by German research group Photon Consulting.
London's Financial Times reports that Photon projects profit growth is expected to accelerate even faster, as costs are contained, pushing margins up to nearly 60 per cent. The interest manifested by many electricity customers in solar cells as a "green" alternative to fossil fuels is also likely to spur a 10-fold surge by 2015 in production of high-purity silicon required for the cells, according to the report.
Demand for the silicon needed for solar cells is likely to rise from 41 000 tonnes in 2006 to 120 000 tonnes in 2010, and 400 000 tonnes in 2015, the report says. The price of this silicon, due to scarcity, has rocketed to as much as $300 000 a tonne.
Michael Rogol, Photon's managing director, said falling costs made the solar power industry increasingly competitive and propelled its growth. "We are seeing incremental changes in innovation which are pushing down costs and helping the sector's expansion," Mr Rogol said.
Many companies in solar energy feel that, although overheads have come down, they can still charge relatively high prices for equipment including components and installations. Also, some charges for installations are covered in many countries by government subsidies.
Jeremy Leggett, chief executive of Solar Century, a leading UK producer of solar panels, said the report's upbeat tone was "credible". The solar sector was likely to be "one of the revolutionary businesses of the 21st century".
Solar installations are expected to provide 15 GW of electricity in 2010, against 2.7 GW last year; only a tiny fraction of total world electricity generation capacity. But Photon reckons by 2015 solar electricity could account for 7.6 per cent of electricity consumption in homes in the world's 30 or so richest countries.
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