Solar Energy Reviews

ALTERNATIVE Energy Outlook

The alternative energy industry is undergoing a recovery after absorbing the world recession and the fall cascade in world prices of crude oil. Earlier this year, quite a few alternative energy companies were in the trough. Despite these Alternative energy companies have recovered from their lows, their valuations are still far below its 52-week highs.

The growth of alternative energy companies is closely linked to the fate of the economy. In its latest version, Information Management Energy (EIA) predicted that the total electricity use of U.S. reduced by 3.3% in 2009, growing by 1.3% in 2010 as the economy improved coerces an gradual recovery in sales of electricity. In FY 2008, USA annual photovoltaic (PV) installed capacity grew 63% year-over-year, making the cumulative installed capacity to 792MW.

According to the Association solar energy Industries (SEIA) – The U.S. trade association on behalf about 500 companies in the solar power industry – Germany occupies first place followed by Spain, Japan and USA in terms of cumulative installed power solar power as the end of fiscal 2008. However, in fiscal year 2008, Spain (2.46GW in 2008) defeated Germany (1.86GW) in terms of new facilities. World solar PV 5.95GW hit a record in 2008, representing growth of 110% over 2007.

According to the Association European Photovoltaic Industry Association (EPIA) – the global industry association for the solar photovoltaic market – the total cumulative installed PV capacity amounted nearly 15GW against only 9GW in 2007.

ALTERNATIVE ENERGY OPPORTUNITIES

Alternative Energy Environmental Advantage: Solar energy is one of the most benign electric generation resources. solar cells produce electricity without air or water emissions, noise, vibration, habitat impact or waste generation.

Fuel Risk Advantage: Unlike fossil and nuclear fuels, solar energy has no risk of instability fuel costs or risk of childbirth. Although there is variability in the amount and timing of sunlight in the day, season and year, of adequate size and configured the alternative energy system can be designed to be highly reliable while providing long-term, fixed price electricity supply.

Location Advantages: Unlike other renewable resources like solar and wind power, hydropower, is generally located on the site due to the availability general sunlight of a client. As a result, solar energy costs and limited energy losses related to transmission and distribution scale power plants to end users. For most residential consumers in a friendly environment for alternative energy, solar energy is now the only viable option because it can be obtained in urban and rural environments.

Subsidy Programs: governments, particularly China, have increased financial support for alternative energy and solar energy projects. China aims to increase its installed capacity of solar energy in 2011 to 2GW capacity to 140MW of fiscal 2008. To meet this objective, the Chinese government provides 50% of the investment cost of solar energy projects. For solar energy projects in areas remote, the government subsidizes 70% of project cost. A company under our coverage will benefit from this initiative include Solarfun Power Holdings Co. Ltd. (SOLF – Snapshot Report).

Through reinvestment of America and Recovery Act (ARRA) approved in February 2009, the U.S. Treasury Department has implemented a program alternative energy to provide subsidies in cash in lieu of investment tax credit for renewable energy projects. Recent focus on renewable sources will greatly benefit companies like Rentech Green Cross Inc. (RTK – Snapshot Report). The Department of Energy (DOE) in the U.S. implemented a loan guarantee program to help developers secure financing for solar projects.

WEAKNESSES OF ALTERNATIVE ENERGY

Recent Start-ups: A large number of recent alternative energy companies start businesses with limited resources. As such, a number depends on the ability of their clients to finance solar energy projects.

The global recession: The global economic crisis has affected sales and growth of alternative energy profits. Weakness in the markets for debt and equity, for the duration, increase the cost of capital for companies in this emerging sector and may hamper funding projects, working capital requirements and new research and development.

Tied to fortune "raw stock prices of alternative energy in general, rise and fall in direct proportion to the price of crude oil. While in times of high oil prices this could represent an opportunity, it also increases volatility in the sector.

Overcapacity: industry wide excess solar cell and module capacity have led to the accumulation over board. As a result, we believe that the performance of alternative energy companies such as Evergreen Solar Inc. (ESLR – Analyst Report), JA Solar Holdings Co., Ltd. (JASO – Analyst Report), A-Power Energy Generation System (APWR – Snapshot Report) and LDK Solar Company Ltd. (LDK – Snapshot Report) – burdened as they are by high inventory levels – will remain under pressure in the short term.

Roll-back German: Germany, a leading solar energy market a lucrative alternative energy program grant, is considering a reversal of their grants. This will affect companies such as First Solar Inc. (FSLR – Report Analyst) and SunPower Corporation (SPWR – Snapshot Report), which causes significant portion of its sales in Germany.