Monday, June 7, 2010

Solar Demand Very Healthy

I'm a big fan of solar energy and I think it's a megatrend in the making.  There are a lot of doubters out there and thus, the whole solar energy sector has taken a beating over the past few months.  Many solar stocks are near their 52-week lows.  There are various reasons for this.  First, Germany is the biggest solar market right now, mainly because its government was an earlier adopter and introduced subsidies early on.  It is now making cutbacks to those subsidies and that has made ripples in the market.  Second, Europe is also the largest solar market out of all of the continents, and we have all heard of the trouble that is brewing in the Eurozone.  So, I don't blame the naysayers entirely.

However, we need to see through this noise.  Look at the megatrend that is forming.  Look at the BP oil spill.  Do you think the world will still want to rely on fossil fuels after this disaster?  Although oil is not directly linked to electricity generation, it is now very apparent that we, as a civilization, can no longer depend on non-renewable energy.  We just had a temperature record breaking spring.  Whether this warm weather is caused by global warming or not, people are starting to associate climate change with usage of non-renewable energy.

I also read two articles that confirm my suspicion, that solar energy is alive and well.  First, First Solar announces that it cannot meet the demand for 2010.  Then, Suntech (Ticker: STP) also makes the same announcement.  These are two of the biggest solar panel makers in the world and if demand is greater than their capacity, then I think overall demand is probably greater than the overall capacity of the total capacity of all solar panel makers.  It's just a hunch, but I'm not afraid to put some money on this hunch.

Anyway, I believe it's a great time to get into solar.  Stock prices are low and upside potential is huge.  Start your research with First Solar (FSLR), Trina Solar (TSL), and Suntech (STP).