Remaining the global leader: An interview with Suntech Chief Commercial Officer and Interim President of Suntech America Andrew Beebe

Andrew Beebe
Andrew Beebe

Andrew Beebe joined Suntech in 2008, following the company's acquisition of EI Solutions, a California-based regional solar installer. Previously, he was the founder of Energy Innovations, a solar technology development company, a partner at Clean Edge, a clean-tech consulting firm, and co-founder and CEO of Bigstep, one of the world's first small business e-commerce solutions providers.

 

Solar Server: Given China's recent announcement of a national price for PV, can you quantify Suntech's expectations for the short- and medium- term future of the Chinese PV market? What are some other factors that will affect this market?

Andrew Beebe: China’s recent feed-in-tariff announcement is a huge step towards its goal of 10GW installed solar capacity by 2015. China’s wind energy feed-in-tariff in 2009 led to the tremendous growth of its wind energy industry in only a few years, and we can expect the same type of boom for solar.

While the feed-in-tariff will catalyze immediate solar industry growth, the overall impetus for China to move away from old power generating methods such as coal fired plants and even nuclear power generation may be the strongest long-term incentive for Chinese PV market growth.

China is well-aware that if global power demand doubles or even triples by the end of the century, fossils alone will not be able to do the job. Solar technology will be a major part of the solution.

 

Solar Server: Which other global markets does Suntech expect to be most important for its sales in the next three years?

Andrew Beebe: We expect the U.S. market to grow at a pace much faster than the global market. Utilities in the U.S. are buying more solar power in response to improved PV economics and more widespread renewable portfolio standards (RPS) in states like California, where they must achieve 33 percent renewable power generation by 2020.

To reach those goals, large-scale solar installations have become commonplace, particularly given solar technology’s unique capacity to effectively meet peak power demands.

As we approach gird parity, solar markets globally will more closely mirror macroeconomic trends. For example, power demand will grow rapidly throughout the Asia Pacific region for the foreseeable future, and those regions are also heavily endowed with sunlight. Consequently, we anticipate countries like China, India, and Thailand will develop vibrant solar markets by the end of the decade.

 

Solar Server: Can you comment further on the U.S. market? Specifically, what strategies does Suntech employ to compete in the U.S. PV market, particularly the utility-scale market?

Andrew Beebe: The U.S. solar market is expected to grow tremendously for the foreseeable future. By 2015, we’re anticipating about 3.5GW to 4GW of annual installations in the utility segment alone. In 2010, Suntech delivered 250MW to the U.S. and we’re targeting to deliver nearly 500MW in 2011 – representing a roughly 20% to 25% market share.

Utilities demand the lowest possible levelized cost of solar electricity. To achieve that, we don’t want to dilute our offerings by tying to compete with EPCs in building power plants. Instead, we want to partner with them so that we can each focus on our core strengths.

We don’t make flat-screen TVs, toaster ovens, or baseball cards. But we’re good at making solar panels. Solar is all that we do. So by partnering with the leaders in power plant construction, we’re able to provide the most competitive packages for solar electricity generation.

 

Solar Server: Given Suntech's recent termination of its long-term wafer supply agreement with MEMC, can you comment on the development of Suntech's internal wafer production? Also, how much of a role do you see internal wafer production playing in Suntech's wafer supply versus other sourcing agreements?

Andrew Beebe: This year, we will increase our internal wafer production capacity to 1.6 GW and optimize our silicon sourcing strategy. In particular, cancelling the MEMC contract will help to facilitate estimated $400 million in cost savings over the next five years.

However, we look forward to continuing our collaboration with MEMC in mutually beneficial supply relationships that support the growth of both companies.

One of the important advantages of our new wafering capacity is that we’re able to integrate new silicon processing technologies developed in-house, and perform cross-segment research and development (R&D), opening new opportunities to further improve product performance. For example, our new SuperPoly silicon processing technology significantly improves the quality of multicrystalline wafers without increasing the costs.

 

Solar Server: What steps is Suntech taking to deal with the pressure of low prices and industry-wide oversupply of modules?

Andrew Beebe: To remain the industry leader, we must continue to drive down the cost of manufacturing while improving product performance. We’re targeting to drive our costs well below one dollar per watt by 2015.

At the same time, we recently introduced two new, high-performance processing technologies that provide more power with the same-sized panel. And we have a clear roadmap for achieving higher conversion efficiencies and product performance while reducing the costs of manufacturing.

Customers value quality, and they realize that not all solar panels or panel suppliers are created equal. Electricity is a commodity, but the technologies used to generate electricity are not. That’s why we’ve increased our R&D investments from USD 14 million in 2008 to over USD 40 million in 2010. As the world’s largest producer of solar panels, we have a proven track-record of delivering large-volumes of high-quality solar panels.

We’ve produced and delivered more than 4 GW of solar panels to thousands of customers in more than 80 countries – or roughly enough capacity to power Kenya. That kind of bankability and experience makes a big difference in project financing and mitigating risk in project execution.

 

Solar Server: Is there anything else about Suntech and the outlook on various markets which you would like to share with our readers?

Andrew Beebe: The price of solar electricity continues to decline steadily thanks to incremental innovation. There hasn’t been one single, revolutionary moment, but steady improvement year by year and even month by month. At this pace, we’re tracking to reach grid parity in half of the world’s markets by 2015.

Solar’s growing competitiveness is unlocking gigawatts of new demand in markets around the world, particularly in the U.S. and Asia Pacific. We couldn’t be more excited about leading the next phase of solar industry development.

 

Conducted on August 30th, 2011 by Solar Server International Correspondent Christian Roselund