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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Jacob Snyder who wrote (43718)	3/17/2009 5:00:08 PM
From: Jacob Snyder	3 Recommendations Read Replies (2) \| Respond to of 95536

Solar vs. Wind: global capacity added in 2008: solar: 6GW (mostly in Europe) wind: 27GW (equal-sized markets in China, U.S., and Europe) wind power, total cumulative installed capacity, global: 1996 6.1 GW 2000 17.4 GW 2004 48 GW 2006 74 GW 2007 94 GW 2008 121 GW Today, wind can be considered a mainstream technology. With wind, it can be confidently predicted that there will be incremental, evolutionary improvements in blade design, turbines, height of towers, power management, etc., but there won't be any revolutionary changes. The basic technology has been decided, and is unlikely to change. The good news: that means the companies that now dominate the industry, are likely to continue to do so. It's easier to pick winners. The bad news: 1. much or all of the industry may have no sustainable competitive advantage (= no sustainable high margins). 2. large further decreases in costs per installed kilowatt, are unlikely. On the other hand, it is still uncertain which basic solar technology is going to win. As with most new technologies, there is likely to be one winner, and lots of losers. At this point, nobody really knows whether CIGS, crystalline silicon, amorphous silicon (like AMAT and Oerlikon as selling), or some other variety of thin-film, will be the eventual winner. So I don't see any good way to pick the winners, at this point. Since solar is still an emerging technology, it has a greater potential (compared to wind) for large technological leaps, and large efficiency increases. Solar companies are also further away from profitability than wind companies. In 2009, given the continuing and increasing overcapacity in the industry, I don't see how anyone will make money selling solar panels. Solar panels are a commodity, and in an environment of massive oversupply, prices are going to be driven down, and stay down, till large numbers of panel-makers go bankrupt. It's just like the memory chip market. global wind 2008 report: gwec.net wind article: blogs.wsj.com