Woodlawn Associates

Management Consulting

  • Strategy
  • Finance
  • Energy
  • Tech
  • Other Industries
  • Blog
Energy » Solar » Page 4

Chinese Solar Powers Up: Lessons for the Wind Energy Industry

Posted on November 29, 2010 by Josh Lutton

We recently looked at the overseas penetration of Chinese solar photovoltaic module makers to see if there might be lessons for the wind turbine industry.  Chinese solar PV module manufacturers have rapidly increased their overseas market share.  For example, they have increased from 0% to over 30% of the California solar market in three years, and have seen similar market share gains in Germany.  Moreover, Suntech, a Chinese PV manufacturer, rated #1 in consideration rate in our recent U.S./Europe survey of solar buyers.

In contrast, the overseas penetration of emerging wind turbine manufacturers has been much more muted.

Six main factors account for the growth of the PV module makers:

  1. Cost leadership
  2. They entered market when supply was tight
  3. Solar modules are (relatively) simple, modular, and scalable, which makes entry easier for new entrants
  4. PV modules viewed as commodity-like
  5. The executive teams of the leading Chinese solar manufacturers have extensive experience outside China
  6. As businesses, the leading Chinese PV makers are relatively transparent to those outside China

The implications for wind turbine manufacturers heading into new regions are:

  1. Expect new market penetration will take a long time due to need for an operating track record.  It may be a long time before local manufacturing capacity is required
  2. Purchasing projects or doing project development can get beyond bankability issues
  3. Developing local engineering and support capabilities should be high priority in overseas expansion
  4. Certain partnerships could accelerate progress and increase probability of success
  5. Prioritize markets appropriately

Download our detailed analysis here.

Solar Photovoltaics: A High Tech Commodity

Posted on November 29, 2010 by Josh Lutton

A short while ago we interviewed about 20 utility- and commercial-scale solar developers and integrators in the U.S. and Europe and found little relationship between developers’ willingness to consider modules and the manufacturer’s home country. In fact, Suntech, a Chinese company, was #1 in consideration rate. Interviewees also generally saw solar panels as commodities, and we found that the distribution of returns in this industry is similar to commodity industries.

While there may be a few ways firms can differentiate themselves, these are likely to make a marginal difference and are best suited to firms with a particular (narrow) niche. Therefore, we conclude that driving down cost is the most important predictor of success.

Download our findings and recommendations here.

  • « Previous Page
  • 1
  • 2
  • 3
  • 4

Read our blog

See our thinking about strategy, management, energy, and tech.

Read now

Subscribe to blog by email

Blog post categories

  • Strategy & Management
  • Sales & Marketing
  • Finance
  • Energy
    • Solar
    • Storage
    • Wind
  • Infrastructure
  • Tech
  • News

Featured posts

Trump Infrastructure Intro
ES 301: Solar + Storage Economics
Tax Equity 101: Structures
Tax Equity 201: Partnership Flips

Search

© 2023 · Woodlawn Associates LLC · 1582 Barclay Blvd., Buffalo Grove, Illinois 60089