Solar panel supply glut past peak - research

* Supply of panels to exceed demand by 66 pct in 2009

* Previous forecast in August was nearly 92 pct

* Strong demand in Germany eating up excess supply

LOS ANGELES, Nov 13 (Reuters) - The global glut of solar panels that has overwhelmed the industry for much of 2009 is past its peak as strong demand from Germany, the world's largest solar market, eats up extra supply, according to a report issued on Friday by industry research firm iSuppli.

Solar panels have piled up and prices have tumbled this year since the financial crisis and pullbacks in government incentives in Spain triggered a drop in demand.

The research group previously forecast the oversupply of panels to last through 2010, but said it estimates the glut could be resolved next year.

"Solar-panel installations in Germany began surging to record levels in July as prices for photovoltaic systems plunged," said Henning Wicht, senior director of photovoltaics research for iSuppli, in a statement.

"This phenomenon has boosted the global solar panel business and mitigated the severe oversupply situation that has stung the industry throughout this year."

The global supply of solar panels is expected to exceed demand by nearly 66 percent in 2009, down from the previous forecast in August of about 92 percent overage, iSuppli said.

The report echoes some positive forecasts given by solar power companies that have reported financial results recently.

Chinese solar panel maker Yingli Green Energy Holding Co Ltd (YGE.N) posted better-than-expected quarterly profit on Friday and said that demand in Europe is outstripping supply.

European renewable energy companies -- such as Germany's Q-Cells AG (QCEG.DE), one of the world's largest solar cell makers -- sounded upbeat for 2010 as cost cuts and an expected pickup in demand helped lift profits after a difficult year. (Reporting by Laura Isensee)