Near the beginning of the decade, several solar start-ups set out to disrupt the solar power industry by producing a new generation of thin-film solar cells that were vastly cheaper to make than the incumbent silicon cell technology.
Now, many of those thin-film solar companies are in a race for their survival, according to a report published today.
Lux Research did an analysis of the competing solar cell technologies and found that polycrystalline silicon, the material used for about 80 percent of solar cells, continues to have staying power as prices decline and efficiencies improve.
Meanwhile, solar panels made from cadmium-telluride, a thin-film material used by First Solar and General Electric, are less efficient than polycrystalline silicon but are the cheapest to produce of all solar technologies. This means that the cadmium-telluride technology will continue to be profitable, according to Lux Research analyst Ted Sullivan.
Other thin-film technologies--thin-film silicon and cells made from copper, indium, gallium selenide (CIGS)--face a longer route to becoming profitable.
"The profitability of thin-film silicon is much dicier," Sullivan said in a statement. "But CIGS is positioned to outplace crystalline silicon in profitability by 2013 as leading developers improve process stability."
Taking into account materials, capital, and labor of making solar panels, Lux Research estimates that certain CIGS technologies will be able to drop the cost from $1.69 per watt to 76 cents per watt and improve efficiency from 10 percent to 14.2 percent, allowing manufacturers to become profitable.
Oerlikon, which makes thin-film silicon manufacturing equipment, will be able to cut the cost per watt from 80 cents last year to 54 cents in 2015, although the efficiencies don't match polycrystalline silicon.
The brute-force economics of crystalline silicon solar, meanwhile, have resulted in cutting the cost of a module, or panel, in half since 2008, according to Lux. In the report, Lux predicts that these crystalline silicon manufacturers and First Solar will continue to be profitable, but that thin-film silicon is in "precarious position" given its relatively low efficiency.
Among the wave of CIGS companies, many funded by Silicon Valley venture capitalists, there will be a "few spectacular successes and a number of stunning failures," Lux predicts. Its predictions single out Miasole as a long-term success, but questions the fates of Nanosolar, Odersun, and Sulfurcell.
Consumers continue to benefit from these solar manufacturers competing on cost and efficiency. But rather than compare the relative efficiency of different solar cell technologies, consumers considering rooftop solar panels should look at different economic metrics--the installed cost per watt and how much energy, in kilowatt-hours, a set of solar panels can produce per year.