Chinese solar company Suntech Power said Thursday it will triple sales in the United States next year through large megawatt and commercial projects and an aggressive expansion in the residential market.
NEW YORK — Chinese solar company Suntech Power said Thursday it will triple sales in the United States next year through large megawatt and commercial projects and an aggressive expansion in the residential market.
Suntech is broadening its reach into the commercial sector by acquiring EI Solutions, the California company that helped convert Google’s renowned headquarters to run partly on solar power.
That Pasadena-based company is part of a high-tech incubator run by entrepreneur Bill Gross, whose idea to link ads to search-engine requests during the 1990s inspired the business model that generates most of Google’s profits.
The acquisition will give Suntech a launchpad for commercial, utility and government contracts.
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Roger Efird, president of Suntech’s U.S. unit, said he was confident that Congress will extend alternative-energy tax credits by the end of the year.
A tax-credit proposal was tacked onto a bailout of the financial sector and approved by the Senate on Wednesday. The House could vote on the proposal as soon as Friday.
“Everyone recognizes that the U.S. is potentially the largest [solar] market in the world,” Efird said. “The stars are starting to line up.”
To capitalize on that market, the maker of solar cells and modules is forming a joint venture with MMA Renewable Ventures to develop, finance and operate photovoltaic projects larger than 10 megawatts.
One megawatt of generation capacity can power 778 households each year, according to the U.S. Department of Energy.
Projects built by the joint venture, Gemini Solar Development Company, will be co-owned and operated by the two companies.
But Suntech also said it would move aggressively into the consumer market, expanding its dealer network to ramp up sales.
One thing holding many solar companies back has been tightness in the silicon market, a primary ingredient in solar panels.
Suntech has been investing in polycilicon producers, which could soon give the company a big advantage over competitors, said Collins Stewart analyst Daniel Ries.
Efird acknowledged that supply has been a problem.
“The demand is certainly there,” Efird said. “We say ‘no’ a lot more now than we say ‘yes,’ unfortunately,” because demand outstrips supply.
Ries, of Collins Stewart, said that the U.S. solar market could eventually rival Europe’s, where government tax credits have created a booming industry.
“It’s generally a market that people have been seeding,” he said of the U.S.
Suntech Power Holdings is on track to post U.S. revenues of $120 million in 2008, Efrid said, implying the company expects 2009 U.S. sales of about $360 million.