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Governor Arnold Schwarzenegger approved a new subsidy for solar
power on Monday and joined forces with the federal government to
fast-track renewable energy projects. This is on top of current solar
incentives, hence it is huge for the industry. California support on
solar energy has drawn many companies open office in the state.
Solarfun (SOLF)
opened Solarfun USA in Southern California city Torrance, expecting to
get a piece of the pie in the world's eighth economy, the company
already raised Q3 shipment to exceed 100MW. Trina Solar (TSL)
also sees module demand picking up, and the company opened US office
earlier this year. Schwarzenegger also signed an agreement with the
U.S. Department of the Interior on Monday to speed development of up to
7,000 megawatts of large-scale renewable energy projects.
In
the PV market, China's domestic demand is not on wall street's radar
yet, at least for analysts from research firms like Raymond James and
others. However, the demand is picking up at faster pace than you
think, according to Best Solar's Peng Xiaofeng at the 2009 Taiwan International Photovoltaic Forum & Exhibition,
Best Solar is projecting 1GW demand in China and 10GW worldwide in
2010. Some Chinese solar names are seeing demand picking up in the
Chinese market. Solarfun Power is seeing higher demand well into 2010,
this reflected high demand from the Chinese market. Trina Solar also
forecasted high demand in the coming quarters; its domestic and US
markets are picking up quickly, and the worst of the solar industry is
behind us according to CEO Jifan. Good quarters are expected in Q3 and
Q4 for these two companies while wall street earning estimates are
still low. This may mark the turning point for solar stock prices.
On
the other hand, a proposal of adding renewable energy into the nation's
eleventh five-year strategic plan is underway, and it is expected to
pass by the congress later this year before the Copenhagen meeting.
China is trying to achieve 290GW of renewable energy by 2020 according to China's renewable energy report.
The following companies will be benefiting from China's energy embition:
First Soalr (FSLR), General Electric (GE), Trina Solar, Solarfun Power, Suntech Power (STP), JA Solar (JASO), Renesola (SOL) Yingli Green (YGE).
Disclosure: Author is long FSLR, TSL, SOLF, JASO and GE
