Informational News Bulletin – Square One Solar Corporation

May 26 2010

Global Solar Markets

Between 2000 and 2009, global photovoltaic demand grew at an average annual rate of 51 percent, rising from 170 MW to 7,059 MW.  It's hard to believe that just ten years ago, the global solar market was 170 megawatts.  That's now the size of a typical utility-scale installation or a small solar factory.

2009 was a growth year in terms of megawatts shipped, if not in terms of revenue, and the solar market has emerged wiser in 2010.  Module ASPs are still going to continue to drop due to an overcapacity situation and many companies will feel margin pressures.  But, having lived through the pain of 2009 and while still in the midst of shakeout and consolidation, the global solar market will come through this bigger and healthier and poised for a new decade of growth.  Grid parity will become a reality, starting in a few high-electricity rate markets and will spread from there.

Greentech Media Research analyst Shayle Kann has just authored an exhaustive study of global photovoltaic demand and the findings are encouraging.  Here's a quote from Kann:

"...2010 will mark the beginning of a global PV market diffusion. Over the past few years, PV demand has been characterized by a series of gold rushes in which the majority of production flows into a single uncapped feed-in tariff market (e.g., Spain in 2008, Germany in 2009). But the gold rush is necessarily followed by the government reducing, and often capping, incentives in order to constrain market growth. This leads manufacturers and developers to seek the next gold rush, and new markets are suddenly flooded with additional inventory. But as Germany's star begins to fade in the second half of 2010, no individual market will emerge to soak up excess inventory in sufficient volume to become the singular focus of global demand. Instead, demand will become increasingly spread amongst a growing class of markets around the world."

Here are some of the insights from the report:

This briefing is not intended to be and is not an advertisement for any securities of the company.  Information presented herein, while obtained from various inside and outside sources, which Square One management believes are reliable, is not guaranteed either as to accuracy or completeness.