Update 1-Interview-Consolidation to hit solar in 2010-BP Solar
November 20th, 2009 | by admin |* BP Solar not looking to acquire any companies
* Could cut panel costs faster than expected
* Sees Italy as top growth market in 2010
LOS ANGELES, Nov 19 (Reuters) - More consolidation couldhit the solar power industry in 2010, as tough competition andfalling prices hit companies sitting on high cost assets andloaded with debt, the chief executive of BP Solar told Reuterson Thursday.
BP Solar, a unit of BP Plc (BP.L ), and other solarcompanies are seeing demand for the renewable energy systemspick up after a dismal year of difficult financing and a tumblein panel prices, but panel prices will continue to drop.
“For some people there will be momentum. For others, theywill struggle to meet the cost reductions and the pricereductions,” BP Solar CEO Reyad Fezzani told Reuters in aninterview.
Fezzani said BP Solar did its own version of consolidation,shuttering more expensive factories, such as phasing out moduleassembly at its plant in Frederick, Maryland.
BP Solar has been in the industry for nearly 40 years andhas about 1 gigawatt of installed or sold capacity for solarpower systems.
“My expectation is that we will see more of the expensiveend of the cost curve be whittled down and cut back,” Fezzanisaid.
Next year looks bright for BP Solar, with “very robustsales” for the first quarter of 2010, said Fezzani, who expectsItaly to be the company’s top growth market next year.
Overall, BP Solar is gearing up to grow 40 to 50 percentnext year, Fezzani said.
The executive expects panel prices, which have plummeted asmuch as 50 percent over the last year, to return to a morenormal rate of decline.
BP Solar could cut solar power panel costs faster thanpreviously estimated.
The company has targeted a 25 percent cut in panel costs bythe end of 2010, and it could make those reductions a quarteror two earlier than its target date, Fezzani said.
The company set that goal to make the renewable energysystems more competitive with traditional electricity. (Reporting by Laura Isensee; editing by Carol Bishopric)
