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Yingli says U.S. solar market has improved markedly
July 22, 2009 / 1:42 AM / 8 years ago

Yingli says U.S. solar market has improved markedly

LOS ANGELES (Reuters) - The head of Chinese solar panel maker Yingli Green Energy Holding Co Ltd’s fledgling U.S. business said the U.S. market for solar power has improved dramatically in the last six weeks.

<p>Attendees looks over solar panels on display in the Sharp booth at the 2008 Solar Power conference and Expo at the San Diego Convention Center in San Diego, California October 14, 2008. REUTERS/Mike Blake</p>

Robert Petrina, managing director of Yingli Green Energy Americas, said in an interview that increasingly attractive returns on solar projects have attracted more debt financing from banks in recent weeks, while the Obama administration earlier this month finally unveiled guidelines that will allow companies to apply for $3 billion in government grants for renewable energy projects.

“Things have improved markedly in the last six weeks,” Petrina said, adding that the biggest change has been in the market for commercial solar projects. Residential sales of solar panels, he said, have remained “rather robust” throughout the economic downturn.

The tax equity market, under which banks funded solar power developments in exchange for renewable energy tax credits, has yet to recover, Petrina said.

Solar panel makers have suffered this year from a falloff in demand due to a lack of available financing for projects and a pullback in government solar subsidies in Spain and Germany. That drop in demand has in turn lead to an oversupply of solar panels that has sent panel prices, and their manufacturers’ profits, tumbling.

Like many in the industry, Yingli is gearing up to capture a bigger share of the growing U.S. market for solar power. The company last week announced that it has opened two offices in New York and San Francisco, where Petrina said it now has a total of eight employees and plans to add more.

The company is partnering with U.S. solar project developers including San Francisco-based Recurrent Energy and AES Solar, a joint venture between power producer AES Corp and private equity firm Riverstone Holdings LLC.

The market for utility-scale solar projects is a good fit for Yingli, Petrina said, because its panels are low in cost.

“The utilities are looking for a great cost,” he said.

Yingli will compete for U.S. utility projects against First Solar Inc, SunPower Corp and Chinese rival Suntech Power Holdings Co Ltd.

Yingli also plans to set up a manufacturing facility in the United States, though Petrina said he would not discuss such a move “until it’s a done deal.”

He also would not discuss any specific sales targets for the United States, except to say that the company aimed to have as big a share of the U.S. market as it does in Europe.

“We like to have market share in the U.S. congruent to market share in Europe. We’re using that as a goal,” Petrina said, saying published reports have put Yingli’s European market share somewhere between 6 percent and 8 percent.

Importantly, Petrina said Yingli has succeeded this year in convincing customers and investors that it is a top tier solar player. This is key in an industry where Chinese solar panels are sometimes perceived as being lower quality than those made in the United States or Europe.

“At (industry trade show) Intersolar in May, we left as a company that is considered bankable by every major customer,” Petrina said. “We’ve been seen by the investment community as a company that can thrive through a difficult period. The first quarter was extremely difficult. The second quarter improved markedly. We feel the third is shaping up to be great.”

Reporting by Nichola Groom; Editing Bernard Orr

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