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This Week in Solar

By Toby Shute – Updated Apr 6, 2017 at 1:29PM

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The race to grid parity, one week at a time.

We'll kick off this weekly survey of the solar scene with a startling statistic. In December alone, German solar photovoltaic installations totaled 1.46 gigawatts. That's equal to global PV installations in all of 2005. Companies like Yingli Green Energy (NYSE: YGE) told us last winter that looming subsidy cuts had "galvanized the PV industry into action," but this figure still had me doing a double-take. In the first half of 2009, only 500 megawatts were installed in Germany. The U.S. added fewer than 500 megawatts all year.

How ironic would it be if this installation blitzkrieg led the coalition government to make more severe cuts to Germany's solar subsidy than have already been proposed?

On Tuesday, Mark Bachman launched coverage of the solar sector from his new post at Auriga USA. He's a fan of Chinese market darlings Yingli and Trina Solar (NYSE: TSL), but gave SunPower (Nasdaq: SPWRA) the big thumbs-down. Bachman has called the firm out for reporting pro forma numbers to put its results in a better light. He also thinks the higher-cost firm should trade down to book value, which is a few dollars below the current price.

On Wednesday, we learned that Trina and Suntech Power (NYSE: STP) have landed gigantic framework agreements with China Development Bank. Basically, these firms have the green light to borrow billions and billions of dollars -- well in excess of either's market cap. How do you compete with this kind of state support if you're SunPower or SolarWorld?

I really don't know the answer to that. Maybe the best you can hope to do is supply Chinese players with the high-end equipment they need to pump out cheap polysilicon and ingots. That seems to be the thinking behind Wunderlich's upgrade of GT Solar (Nasdaq: SOLR) this week. From leaders like First Solar (Nasdaq: FSLR) to laggards like Energy Conversion Devices (Nasdaq: ENER), I really don't envy the Western players competing in the solar space right now.

First Solar and Suntech Power Holdings are Motley Fool Rule Breakers picks. Try any of our Foolish newsletters today, free for 30 days.

Fool contributor Toby Shute doesn't have a position in any company mentioned. Check out his CAPS profile or follow his articles using Twitter or RSS. The Motley Fool has a disclosure policy.

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