Trina Solar seeking U.S. project partners

LOS ANGELES Wed Sep 9, 2009 3:38pm EDT

1 of 2. Terry Wang, CFO of Trina Solar, speaks at the Reuters Global Climate and Alternative Energy Summit in New York, September 9, 2009.

Credit: Reuters/Brendan McDermid

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LOS ANGELES (Reuters) - Chinese solar company Trina Solar Ltd is seeking partnerships with project developers in the United States as it looks to expand its presence in that nation's growing renewable energy market.

Trina, which is also considering opening more offices and a manufacturing site in the United States, is one of a string of Chinese solar companies eager to break into the lucrative U.S. market for large-scale solar projects.

"Honestly we lag behind," Trina Chief Financial Officer Terry Wang said in an interview at the Reuters Global Climate and Alternative Energy Summit in New York. "First Solar and SunPower got a good start because they are located in the U.S. We are not bidding (on projects) yet. We would like to do it."

Trina shares were up 1.1 percent at $29.08 in mid-afternoon trade on the New York Stock Exchange.

Meanwhile, the company is looking for partnerships with U.S. project developers, but said "it takes time."

In Europe, Trina said it is considering getting into the project finance arena by building and then either holding or selling its own projects.

"We are looking aggressively, actively, although we don't have anything invested yet," Wang said. "We basically started with Europe, with a high return area, such as Italy."

Several solar companies have announced forays into project finance as the global credit crisis has dried up funding for renewable energy projects.

In the United States, the collapse of top solar financier Lehman Bros a year ago dried up demand for investments under which banks would fund solar power projects in exchange for renewable energy tax credits.

On Wednesday, however, Wang said Trina had been in recent talks with banks including JPMorgan Chase & Co and Goldman Sachs Group Inc about tax equity financing.

The global dearth of financing for solar projects has contributed to a glut of panels in the market that has sent prices into a downward spiral since the end of last year.

Recently, Chinese manufacturers have come under fire from German rivals who accuse them of keeping prices at unsustainably low levels to gain market share.

"We do not like to volunteer to lower price to gain market share," Wang said, but added that it would act to compete with rivals who have "very aggressive pricing strategies."

Solar panel prices are expected to stabilize in the second half of next year, Wang said, but added that the company would be able to keep margins at current levels.

Trina has said its average selling prices are expected to drop between 10 and 15 percent in the third quarter, with a further drop of 10 percent to 12 percent in the fourth quarter. here

"Going forward in our cost structure, we'll be in line with the (average selling price) drop so we can maintain our gross margin," Wang said.

To do that, Trina has been working to reduce inventories, Wang said. here

"At the end of Q2 we only have a $69 million inventory versus our peers who had a couple of hundred million dollars of inventory at a high carrying cost," he said.

(Additional reporting by Adriana Garcia, Nicole Volpe and Matt Daily in New York; Editing by Phil Berlowitz)

(For summit blog: blogs.reuters.com/summits/)

(Reporting by Nichola Groom)

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