Company News

First Solar says can't meet demand for modules

* Business booming ahead of German subsidy cuts

* Cuts due July 1, but may be delayed

* Further pick-up seen in Q4 ahead of 2011 cuts

GENEVA, June 5 (Reuters) - The market for solar modules, a key element in solar power systems, is so strong that industry leader First Solar FSLR.O will not be able to meet demand this year, a senior executive was quoted as saying on Saturday. Business is likely to pick up strongly in the fourth quarter after slowing in the third on planned cuts to subsidies in Germany, the world's biggest solar market, Stephan Hansen, responsible for business in Europe, the Middle East an Africa, told Swiss paper Finanz und Wirtschaft.

“In 2010 we will not be able to produce enough modules to meet demand,” Hansen said in an interview with the paper.

Business has been very good in the first half, with orders extremely high ahead of the German solar subsidy cuts due on July 1, he said.

Germany’s upper house voted on Friday against the cuts, but government sources said this was only likely to delay them, and they would be applied retroactively. [ID:nBAT005524] [ID:nLDE65215T]

Hansen noted subsidies would fall again in 2011.

He said that big Chinese producers such as Suntech STP.N, Yingli YGE.N and Trina TSL.N had signalled that they were also sold out.

Hansen said business would certainly move to other European countries if Germany stopped subsidising farmland solar systems as it plans.

The United States had enormous potential, as do the Middle East, Africa, China and India in the medium term, he said.

The company, which is the world’s lowest cost producer of solar modules, is having to postpone projects in the United States to meet demand in Europe, he said, predicting growing markets in Italy, France, Spain, China and Australia.

Reporting by Jonathan Lynn; editing by John Stonestreet