Jump to content
Guest Klothilde

First Solar (FSLR)

Recommended Posts

Guest Klothilde

http://www.bloomberg.com/news/2013-01-31/first-solar-s-new-mexico-project-may-get-less-than-coal.html Horrible news for the Solar 11: FS signed a PPA for 5.79 uscents/kWh, which is less than the LCOE of new coal plants. Nice try to fool people with your "long-term" unsubsidized PPA price goal of 10-14 cents, FS !!! 5.79 uscents has the ITC in it, but take it out and you still get 8.3 uscents.

Share this post


Link to post
Share on other sites

Ok, just to straighten this out; what IRR at what subsidy free price would such a New Mexico plant achieve with FS modules?

Share this post


Link to post
Share on other sites
Guest eysteinh

Klothilde how is this horrible news for the solar 11? First solar undercutting prices and getting little income for watts sold. Is not this a desperate move to still keep building new projects imho? Also I would like to see the economics of this. How the plant owner expect to turn a profit. Interesting news for sure. I am just not sure what to make of it yet.

Share this post


Link to post
Share on other sites
Guest Klothilde

Ok, just to straighten this out; what IRR at what subsidy free price would such a New Mexico plant achieve with FS modules?

I ran a quick and dirty calculation WITHOUT ITC For a single-axis installation:

PPA rate: 8.3 uscent/kWh escalated at 3%/year for 20 years

Capex: $2140/kWdc, this includes 25% gross margin for FS (plant COGS= $1712/kWdc)

Opex: 1% of Capex, escalated at 2% annually

Yield: 2188 kWh/kWdc, annual degradation of 0.5%

Project IRR: 6.8%

Equity IRR: 10.1% at 80/20 Debt/Equity and Debt cost of 6%

I will try and do an in-depth LCOE comparison between FS and c-Si over the next weeks and would also appreciate your feedback/input

Share this post


Link to post
Share on other sites

If we use efficiency as the leverage this is still good for everyone in the industry as the pv silicon is more efficient then thin-film. I think Klothilde is somewhat sarcastic, this is a great news for all of them. Finally Bloombergs are typing news which makes oil and coal magnates to sweat profusely and reach quicker for their scotch.

Share this post


Link to post
Share on other sites
Guest Klothilde

@odyd: efficiency doesn't matter by itself. Ultimately it all comes down to LCOE or cost per kWh. Who provides the cheaper electricity, FS or c-Si from China? We will know over the next weeks. For now I just wanted the c-Si investors to panic a little bit.

Share this post


Link to post
Share on other sites

@Klothilde, certainly, but wasn't the case in the past to build up 20% of more install to meet the plant expectation just in case? <p> Was there performance issues at stake as well. At the dawn of Chinese EPC, they will undercut any EPC project, and LCOE will follow. <p> FS margins will suffer a lot when they will go on with this model. Just from the floor perspective FS could be heading down while the Chinese seem to have way up only ahead of them, my two cents. Would like to see your analysis on costs in a short while. I am excited for FS.

Share this post


Link to post
Share on other sites

Thanks. I'll give it a detailed look later.

PPA rate: 8.3 uscent/kWh escalated at 3%/year for 20 years

I'm not very familiar with PPA structure, but is 3% inflation adjuster common in these agreements as opposed to FiT where price is fixed, giving a frontloaded discounted cashflow for the owner, allowing quicker ROI on these capex intense projects. From the purchaser side there's no capex so they can accept backloaded return on the (FiT) agreement.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • Recently Browsing   0 members

    No registered users viewing this page.



×