Executive Summary-BIPV Markets

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This new report tracks and quantifies the latest developments in the BIPV sector, showing, for example, how and where collaborations between the PV industry and construction industry are creating new ways to add value to buildings and creating new ways for both industries to make money. This report also discusses how BIPV may benefit from today’s regulatory climate. Because BIPV enables the costs of the building fabric and photovoltaic system to be shared over the same infrastructure, NanoMarkets sees the BIPV market as having an increasingly attractive business case, even if subsidies for PV are reduced, as seems likely. Thus BIPV may be an important step towards PV becoming a substantial industry that may eventually be self-sustaining without government subsidies.

The coverage of the report includes the residential and commercial/industrial sectors; new construction and retrofits. We consider the sizes of the various BIPV markets, the roles and strategies of important firms in the industry, and the various PV technologies as they relate to BIPV. In total the report provides a thorough guide to the revenue-generating opportunities for BIPV over the next eight years.

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Executive Summary-BIPV Markets

  1. 1. NanoMarkets www.nanomarkets.net Building-Integrated Photovoltaics Markets--2011 Nano-375 Published July 2011 © NanoMarkets, LCNanoMarkets, LCPO Box 3840Glen Allen, VA 23058Tel: 804-360-2967Web: www.nanomarkets.net NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  2. 2. NanoMarkets www.nanomarkets.netEntire contents copyright NanoMarkets, LC. The information contained in this report is basedon the best information available to us, but accuracy and completeness cannot beguaranteed. NanoMarkets, LC and its author(s) shall not stand liable for possible errors of factor judgment. The information in this report is for the exclusive use of representativepurchasing companies and may be used only by personnel at the purchasing site per salesagreement terms. Reproduction in whole or in any part is prohibited, except with the expresswritten permission of NanoMarkets, LC. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  3. 3. NanoMarkets www.nanomarkets.netTable of ContentsExecutive Summary ............................................................................................................. 1 E.1 The Evolving Business Case for BIPV............................................................................ 1 Page | i E.2 BIPV and Aesthetic Opportunities ............................................................................... 2 E.2.1 Aesthetics and the New Market for BIPV.................................................................................................. 3 E.2.2 Aesthetics, Architects and BIPV ................................................................................................................ 4 E.3 Market Positioning and Distinguishing Features of BIPV .............................................. 5 E.3.1 Opportunities for PV Companies .............................................................................................................. 6 E.3.2 Opportunities for Architects, Builders, and Roofers .................................................. 9 E.3.3 Opportunities for Distribution and Retail ............................................................... 11 E.4 Firms to Watch ......................................................................................................... 11 E.4.1 Ascent Solar Technologies (NASDAQ: ASTI) ............................................................................................ 11 E.4.2 Dow Chemical ......................................................................................................................................... 12 E.4.3 Dyesol and Tata and Corus...................................................................................................................... 13 E.4.4 Global Solar ............................................................................................................................................. 14 E.4.5 Konarka and Solarmer ............................................................................................................................. 15 E.4.6 Lumeta .................................................................................................................................................... 16 E.4.7 Odersun................................................................................................................................................... 16 E.4.8 Pythagoras Solar ..................................................................................................................................... 17 E.4.9 Soltecture ................................................................................................................................................ 18 E.4.10 SRS Energy ............................................................................................................................................. 19 E.4.11 Sunovation ............................................................................................................................................ 20 E.4.12 United Solar Ovonic .............................................................................................................................. 20 E.5 Summary of Eight-Year Forecasts of BIPV Markets .................................................... 21Chapter One: Introduction ................................................................................................. 23 1.1 Background of this Report ........................................................................................ 23 1.1.1 BIPV Market Drivers ................................................................................................................................ 23 1.1.2 Three Approaches to Building Integration: Rigid, Flexible, Transparent ............................................... 24 1.2 Objectives and Scope of this Report .......................................................................... 26 1.3 Methodology of this Report ...................................................................................... 27 1.4 Plan of this Report .................................................................................................... 27Chapter Two: Recent Commercial Developments in BIPV ................................................... 29 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  4. 4. NanoMarkets www.nanomarkets.net 2.1 Rigid BIPV: Roofing and Cladding .............................................................................. 29 2.1.1 Rigid BIPV Trends in 2010 and 2011 ....................................................................................................... 31 2.1.2 Key Suppliers in the Rigid BIPV Sector .................................................................................................... 32 2.2 Flexible BIPV: Shingles, Laminates, Etc. .................................................................... 32 2.2.1 Flexible BIPV Trends in 2010 and 2011 ................................................................................................... 33 Page | ii 2.2.2 Key Suppliers in the Flexible BIPV Sector ................................................................................................ 34 2.3 BIPV Glass: Transparent and Semitransparent.......................................................... 36 2.3.1 BIPV Glass Trends in 2010 and 2011 ....................................................................................................... 38 2.3.2 Key Suppliers in the BIPV Glass Sector .................................................................................................... 40 2.4 Cost Issues ............................................................................................................... 41 2.4.1 Cost of Roofing Materials........................................................................................................................ 41 2.4.2 Cost of PV ................................................................................................................................................ 41 2.4.3 Cost Benefits of BIPV Glass ..................................................................................................................... 43 2.5 BIPV Trends by Type of PV Technology ..................................................................... 44 2.5.1 Crystalline Silicon .................................................................................................................................... 44 2.5.2 Thin-Film Silicon ...................................................................................................................................... 45 2.5.3 CIGS ......................................................................................................................................................... 47 2.5.4 CdTe ........................................................................................................................................................ 49 2.5.5 OPV and DSC ........................................................................................................................................... 50 2.6 Key Points Made in this Chapter ............................................................................... 52Chapter Three: Characteristics of BIPV Markets ................................................................. 56 3.1 BIPV and Prestige Buildings: Real Market or PR? ....................................................... 56 3.1.1 BIPV Demand Drivers .............................................................................................................................. 58 3.1.2 BIPV Mandates ........................................................................................................................................ 61 3.1.3 Role of Strategic Partnering .................................................................................................................... 63 3.1.4 Maturity of Technologies for BIPV .......................................................................................................... 65 3.2 BIPV and Residential Property Markets..................................................................... 66 3.2.1 Roofing and Siding Materials in Residential Buildings ............................................................................ 67 3.2.2 BIPV Glass................................................................................................................................................ 69 3.3 BIPV and Commercial Property Markets ................................................................... 69 3.3.1 Roofing Materials in Commercial Buildings ............................................................................................ 69 3.3.2 Siding Materials in Commercial Buildings ............................................................................................... 70 3.3.3 BIPV Glass................................................................................................................................................ 71 3.4 Architects as Shapers of the BIPV Market ................................................................. 74 3.5 BIPV Developments in Key International Markets ..................................................... 75 3.5.1 Japan ....................................................................................................................................................... 75 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  5. 5. NanoMarkets www.nanomarkets.net 3.5.2 China ....................................................................................................................................................... 77 3.5.3 Germany ................................................................................................................................................. 78 3.5.4 U.S. .......................................................................................................................................................... 80 3.6 Can BIPV be Just Another Building Product? ............................................................. 81 3.6.1 BIPV Codes and Regulations ................................................................................................................... 82 Page | iii 3.6.2 BIPV Reliability and Bankability .............................................................................................................. 83 3.6.3 Distribution Channels for BIPV ................................................................................................................ 84 3.7 Key Points Made in this Chapter ............................................................................... 85Chapter Four: Eight-Year Forecasts .................................................................................... 88 4.1 Forecasting Methodology ......................................................................................... 88 4.1.1 Economics, Construction and BIPV ......................................................................................................... 89 4.1.2 Alternative Economic Scenarios.............................................................................................................. 90 4.1.3 Scope of Forecast .................................................................................................................................... 90 4.2 BIPV Cost by Product Type ........................................................................................ 92 4.2.1 Cost Assumptions for Rigid BIPV Forecasts ............................................................................................. 93 4.2.2 Cost Assumptions for Transparent/Semi-Transparent BIPV Forecasts ................................................... 93 4.2.3 Cost Assumptions for Flexible BIPV Forecasts ........................................................................................ 94 4.3 Eight-Year Forecasts of Rigid BIPV Tiles and Panels ................................................... 94 4.4 Eight-Year Forecasts of Transparent and Semi-Transparent BIPV Products ................ 96 4.5 Eight-Year Forecasts of Flexible BIPV Products and Laminates ................................... 99 4.6 Summary of Forecasts ............................................................................................ 101 4.6.1 Summary of Worldwide BIPV Markets by Product Type ...................................................................... 101 4.6.2 Summary of Worldwide BIPV Markets by Watts Shipped and Technology Type ................................ 103 Abbreviations and Acronyms Used In this Report ......................................................... 106 About the Author ......................................................................................................... 107 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  6. 6. NanoMarkets www.nanomarkets.net List of ExhibitsExhibit E-1: Cost Advantages and Disadvantages of BIPV ........................................................................... 3Exhibit E-2: Aesthetic Advantages and Disadvantages of BIPV .................................................................... 5 Page | ivExhibit E-3: Summary of BIPV Markets ($ Millions) ................................................................................. 21Exhibit 2-1: Cost of PV Systems per Square of Roof Area, 10 Percent Module Efficiency ($) ............................ 41Exhibit 2-2: Peak Power Producible per Square of Roofing ....................................................................... 42Exhibit 3-1: Interest in BIPV by End-Use Segment as Determined by ROI Term ............................................. 60Exhibit 3-2: Common Building Requirements for BIPV ............................................................................. 82Exhibit 3-3: Major PV Standards that also Apply to BIPV .......................................................................... 83Exhibit 4-1: BIPV Cost by Product Type (Cost per Watt $) ......................................................................... 92Exhibit 4-2: Rigid BIPV Installations by Technology ................................................................................. 95Exhibit 4-3: BIPV Glass Installations by PV Technology............................................................................. 98Exhibit 4-4: Flexible BIPV Installations by PV Technology ........................................................................100Exhibit 4-5: BIPV Products by Product Type ..........................................................................................102Exhibit 4-6: BIPV Installations by PV Technology ...................................................................................104 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  7. 7. NanoMarkets www.nanomarkets.netExecutive SummaryE.1 The Evolving Business Case for BIPVAs the construction industry continues in its doldrums throughout the world, constructionfirms are looking for new ways to boost business prospects. The trend toward "Green" and Page | 1"Leadership in Energy and Environmental Design (LEED)" buildings is appealing from theconstruction industrys perspective, because it can add some appeal to buildings, makingthem more salable in a down market. Rental buildings with "Green/LEED" appeal haverelatively higher occupancy rates, making pragmatic investment in Building-IntegratedPhotovoltaic (BIPV) retrofits part of an owners long-term management options, regardless ofgovernment incentives.Green/LEED building technologies include smart-window coatings, solar-thermal, energy-efficient lighting, and rain water recycling, among many options. BIPV is one of the moresignificant Green/LEED technologies, since electricity cost is one of the main ongoing buildingoperating expenses. However, BIPV must still compete with other Green/LEED buildingtechnologies in the market, and the decision-maker often is not the long-term owner.Government incentives and mandates specifically for BIPV already exist in many regions, andNanoMarkets sees these initiatives continuing if not increasing over the timeframe of thisreport. In response to the tragedy of the Fukushima-Daiichi nuclear meltdowns Japan, Chinaand Germany have all announced changes to national energy strategies to de-emphasizenuclear power and replace it with renewables like PV. The Japanese government has declaredthat all of the country should have BIPV by 2030. Government mandates will probably lagfeed-in tariffs (FITs), but both should slowly increase over the forecast period of this report.With government incentives currently in place, some BIPV products can already be positionedin target regions as "free PV," where the BIPV after incentives costs no more than other high-end cladding materials. Many second-generation BIPV products target return-on-investment(ROI) times of three-five years with current incentives and seven-ten years without incentives.Thus, demand for BIPV should remain solid and growing over the duration of the forecast inthis report.Another big opportunity for BIPV is the ability to provide PV power solutions that lower totalbuilding costs for buildings that are planning to use PV in the first place. Achieving this goal isalways a good thing, and in a construction market that is having serious problems worldwide,it is a very good thing! In particular, retrofit building markets often pick up during newconstruction downturns, and with excess building inventories in most global regions in 2011, NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  8. 8. NanoMarkets www.nanomarkets.netwe expect that much of the demand for BIPV over the duration of this report will be forretrofits. Retrofits may be triggered by an eventual failure of an old cladding product, or byfinancial incentives.The retrofit market includes people "shopping" for a possible new roof as the old roof wears- Page | 2out over time, as well as "post-incident" repairs. "Whatever you buy, its coming off in 18years," commented one interviewee working on BIPV for rooftops. In the case of people onlyshopping for a new roof, they may be more inclined to wait a year or more to install BIPV ifthey think that incentives and feed-in-tariffs may improve.In the case of people considering BIPV post-incident, the need to re-establish a leak-free roofclearly forces an immediate decision. However, in both retrofit cases, the "go/no-go" decision-maker will generally be the long-term building owner, and so less than ten-year ROIconsiderations seem appropriate.There may be plenty of other ways to supply electricity to buildings, but obviously PV is atechnology on the rise. There can be many reasons why an architect/builder would opt for aconventional building material other than cost, though; the most obvious are aesthetics anddurability. For this reason, BIPV, we believe, will have a rising share of the PV used in buildings,but will never have 100 percent of that market.While this issue is the part of the story about BIPV cost that leads to an obvious opportunityfor panel vendors involved in the BIPV market, we note that cost factors impacting BIPV arequite complex and various. They are also different depending on whether one is talking aboutconventional c-Si BIPV or the various thin-film BIPV products that are beginning to enter themarket. With all of this in mind, in Exhibit E-1 we summarize the cost advantages anddisadvantages of different PV technologies for BIPV product categories.E.2 BIPV and Aesthetic OpportunitiesIt was aesthetics that drove the first developments in BIPV as a way to make building-mounted PV systems look less like power plants. Large roof- or wall-mounted solar panels arenot generally considered aesthetically pleasing any more than satellite dishes are; at bestpeople get used to seeing these installations as they become more common. In some casesconventional PV installations can even run afoul of local building ordinances. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  9. 9. NanoMarkets www.nanomarkets.netExhibit E-1 Cost Advantages and Disadvantages of BIPV Advantages DisadvantagesCRYSTALLINE SILICON:Rigid BIPV High conversion efficiency Sensitivity to silicon market Discrete cells make product layout easy for specified tile dimensions Page | 3Flexible BIPV Would presumably have high conversion Silicon cell rigidity and fragility efficiency if it could be made Wafer thickness constrained by handling No truly flexible solutions at this time"Transparent" BIPV High conversion efficiency Difficult to automate customized Ease of glazing silicon cells assembly processes Easily customizable sizes and shapesTHIN-FILM/ORGANICPV:Rigid BIPV Lower cost potential of TFPV vs. c-Si PV Lower conversion efficiency Can cover larger portions of terraced tiles Unusual substrate shapes can be problematicFlexible BIPV Inherent flexibility of some TFPV and Lower conversion efficiency OPV/DSC Encapsulation issues Light weight"Transparent" BIPV Automated factory production Difficult to make custom sizes and shapes True transparency of some may avoid Lower conversion efficiency spaces between cells© 2011 NanoMarkets E.2.1 Aesthetics and the New Market for BIPVThe conventional PV market is, in fact, all about costs. Panel and installation costs along withelectricity generation and incentives produce real numbers for hard calculations of cost andpayoff, and PV is usually an investment question.The second-generation of BIPV products have been designed specifically for integration intobuilding surfaces, unlike prior Building-Attached PV (BAPV) and first-generation BIPV thattended to be standard utility panels with custom mounting hardware. Second-generation BIPVproducts are generally made to provide 10-14 percent PV efficiency, while also meeting all thecodes and standards of traditional high-end building products. These products are alreadyestimated to be 70-80 percent as efficient as BIPV can ever get based on champion laboratoryresults and manufacturing experience, and so represent an excellent investment into long-term energy generation capacity.Such products are designed to be delivered through standard building industry supply chainsand installed by standard building industry professionals. These products will start "bootstrapping themselves" into the market as ease of install and attractive functionality trigger NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  10. 10. NanoMarkets www.nanomarkets.netever more demand. The comprehensive goal is that BIPV will be seen as part of the standardportfolio of high-end "Green" building products used by architects and builders.Precisely because it is a non-enthusiast market, aesthetic concerns are likely to be prominentand, in our opinion, this fact gives BIPV a significant opportunity to capitalize on its ability to Page | 4masquerade as an attractive building material and not just an ugly panel that gets fixed to aroof. As such, second-generation BIPV can compete effectively against conventional BAPVproducts, but can also compete to some extent against (high-end) building materials. E.2.2 Aesthetics, Architects and BIPVLike anyone else involved in the construction industry value chain, architects spend much oftheir time dealing with cost issues. However, architecture is in most cases not a business offinding the lowest cost; architecture involves many aesthetic and stylistic concerns that areconsidered more important than simply going for the lowest cost building. That is why usingan architect, rather than simply a builder/draftsman, is almost always a very expensive option.In any case, it suggests that the aesthetics of BIPV might well be something that could appealto architects, although the degree to which factors other than cost matter, of course, is highlydependent on the particular building, the particular architect, etc. Architects, we believe, canhelp promote BIPV as aspects of "Green/LEED" building design.As with the cost issues described above, there is a lot more to the aesthetics issue relating toBIPV than is covered in these few paragraphs. Exhibit E-2 illustrates some of the aesthetics-related advantages and disadvantages of crystalline silicon-based BIPV and thin-film andorganic-based BIPV for the different types of BIPV products. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  11. 11. NanoMarkets www.nanomarkets.netExhibit E-2 Aesthetic Advantages and Disadvantages of BIPV Advantages DisadvantagesCRYSTALLINE SILICON:Rigid BIPV Cells fit well into tile-shaped Cell appearance can be considered packages unattractive Suitable for flush mounting Limited sizes and shapes of cells Page | 5 Cell appearance can be attractive Silver tabbing usually requiredFlexible BIPV Would offer a classic PV Standard cells too rigid and fragile for flexible appearance if it could be made BIPV affordably in volume Ultra-thin silicon only shown in labs with no commercial product plans known"Transparent" BIPV Custom shapes can be handled Cell misalignment produces irregular with attractive cell layouts reflections, and tabbing may look unattractive Cell appearance can be attractive Even use of prism/mirrors limits off-axis transparencyTHIN-FILM/ORGANICPV:Rigid BIPV Clean, uniform appearance More or larger panels required for same Suitable for flush mounting powerFlexible BIPV Clean, uniform appearance Additional framing needed for some Curved installations possible installations Versatile for use on many surfaces Versatility can lead to some undesirable installations"Transparent" BIPV Clean, factory precision Very low efficiency limits economic appeal appearance Custom/irregular panel shapes may have Some may produce transparent unattractive patterns or be impossible BIPV glass with no visible pattern© 2011 NanoMarketsE.3 Market Positioning and Distinguishing Features of BIPVOn the supply side of things, BIPV provides considerable new product opportunities for thepanel supplier or even the installer/systems integrator to exploit. This situation is positiverelative to the conventional PV market, where there is little difference between one panel andthe next, except in terms of panel size and cost; a situation that incidentally invites strongbranding efforts in the future.By contrast, BIPV permits a wide variety of product variations in terms of both form andquality and much of this report deals with how that fact is best exploited by BIPV providers tomake real money. With this in mind, NanoMarkets has defined three primary types of BIPVproduct that we believe together represent the main product directions for BIPV: rigid(opaque) products, flexible products, and transparent/semi-transparent products. Each classhas unique features and concerns in terms of costs. The different PV technologies also eachbring their own cost-related benefits and challenges to BIPV. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  12. 12. NanoMarkets www.nanomarkets.net E.3.1 Opportunities for PV CompaniesFirst-generation BIPV: As we discuss in the main body of the report, while the medium-to-long term potential for product range diversification is very high within the definition of BIPV,it is important for the firm that enters this space to realize that we are only just entering theBIPV era. Just a few years ago, BIPV meant little more than using completely conventional Page | 6panels and hiding them with architectural features. This approach required some carefulroofing design, but this kind of first-generation BIPV really didnt manifest most of the benefitsthat we see flowing from "real" second-generation BIPV.Flush-mounted panels: Currently, a lot of what passes for BIPV are actually flush-mountedpanels and little more; again as we have noted, this type of system is a long way from theexciting products that BIPV seems to promise. We believe that such flush-mounted PV panelinstallations should be considered as BIPV—and consider them such in the report—if thepanels are designed specifically for that purpose. In this case, they approximate the aestheticsexpected from BIPV; they certainly provide a more attractive alternative than large rack-mounted systems. They also provide some real market differentiating features for panelsuppliers. In particular, we note that these flush-mounted panels provide one of the mostaccessible BIPV options, especially for small, budget-minded users like most residential owners,and especially for retrofits.Since PV is the most cost sensitive portion of BIPV, it makes sense to minimize the costs thatfall into the PV category and to allow the architectural cost category to "take up the slack".This strategy is hard to implement when BIPV consists of flush-mounted but otherwiseconventional panels or laminates installed over existing conventional building materials; thePV costs for such an installation are completely obvious because the PV system is installedcompletely separate from the architectural components.However, when fully integrated BIPV products come from a factory with the PV devicesalready incorporated, or when the building material does not function well without the PVdevices or vice versa, the distinction between the architectural and building material costs ofa BIPV product and the PV costs is much fuzzier. BIPV suppliers can then more easilymaximize the perceived value of the architectural aspects of their BIPV products, leaving asmaller portion of the BIPV costs to be assigned as PV system costs and increasing theiropportunity to improve profitability.This approach is easiest to manage when the conventional building materials that BIPV isdesigned to match or replace are high-end, high-cost ones. If the building material costs arealready comparable to or higher than the cost of PV by itself, there is much more ability to NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  13. 13. NanoMarkets www.nanomarkets.netabsorb a significant part of the PV cost into the cost of the building materials used or replaced.This scenario already exists for some expensive building materials like certain architecturalglass and high-end roofing slate. BIPVs task is to position products as high-end through theirdesign—emulating high-end building materials—or by other marketing means. Page | 7Eventually the cost of the PV within BIPV products and systems should be low enough inproportion to high-end building materials that it will be (almost) fully absorbable into the costof those materials. At the very least, the premium commanded for PV should decline to apoint where BIPV can be marketed as just another high-end building material in some sense.Declining PV prices will also eventually allow significant portions of PV cost to be absorbed bymid-range and lower-end building materials, enhancing BIPVs market position in thosecategories.Newer BIPV products: One of the most attractive newer approaches to BIPV is making BIPVtiles that interlace with conventional high-end roofing tiles. This approach has been used for afew years with crystalline silicon PV and only to a small extent with thin-film PV. But nowthere is increasing development of interlacing products with slightly different approaches.New CIGS-based flexible roofing products like Dow Chemicals shingle product makeadditional markets more accessible to PV and BIPV firms.There are also new approaches to making BIPV glass more attractive. Thin-film PV-based BIPVglass is one approach; these panels replace the squareish silicon cell-space pattern withtighter, more precise pinstripe or other patterns and eliminate the tabbing that spans thespaces between cells. Uniform thin-film semi-transparent and opaque panels also exist forsidewall spandrels, shade screens, and canopies.Crystalline silicon still provides the highest PV conversion efficiency, and with cleverunderstanding of optics, mechanics, and industrial engineering can be incorporated into newsecond-generation BIPV products. Pythagoras Solar is noteworthy for using arrays of prisms tohide crystalline-silicon cells on their sides in double-pane Insulated Glass Units (IGU) thatappear almost completely transparent when looking straight through them. The companyuses a fabless/foundry manufacturing model to be able to rapidly scale capacity with demand.Opportunities for Crystalline Silicon PV suppliers: Crystalline silicon (c-Si) still maintains thefundamental advantage of providing the highest affordable efficiency among BIPV absorbermaterials. There are many cost-effective specialty BIPV modules that can be made using c-Sicells. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  14. 14. NanoMarkets www.nanomarkets.netThere are also other opportunities for crystalline silicon PV suppliers to profit from the BIPVmarkets, but they mainly deal with ways of splitting the cost of the PV with the cost of thebuilding materials with which it is integrated. To best do this, we believe, the underlyingopportunity is to position the products as high-end "smart" building materials, with the PVcosts being absorbed in the premium that customers are willing to pay for high-end building Page | 8materials. This kind of BIPV product, for example, can be made to emulate roofing slate interms of dimensions, shape, texture, and color.Opportunities for Thin-Film PV Suppliers: While many BIPV tile products are based oncrystalline silicon PV, TFPV can offer better coverage of unusually shaped tiles as well asconformity to tiles that arent flat. This market is fairly wide open to TFPV suppliers andobviously lends itself to builders, architects and building owners who want their property tohave a more valuable "Green/LEED" look.As the highest-performing thin-film PV technology, there are several opportunities availablespecifically for CIGS PV. The semitransparent BIPV market is dominated by crystalline siliconPV. CIGS-based BIPV glass has the opportunity to offer the aesthetics of thin-film withperformance closer to that of crystalline silicon.Despite exits from the BIPV market by Ascent Solar and SRS Energy in the last 12 months (seesection E.4, below), other CIGS and a-Si thin-film BIPV companies continue to developproducts and distribution channels. NanoMarkets sees both Ascent Solar and SRS Energy ashaving burdens of manufacturing cost-structures relatively higher than their comparable thin-film counterparts. In particular, Dow Solar, Global Solar, Soltecture (formerly Sulfurcell), andOdersun all have second-generation BIPV products designed using CIGS, and all targeting five-ten year payback times for building owners.Among flexible BIPV laminate producers there is also an opportunity to boost sales by sellinglaminates directly to end users. Such direct sales can appeal to PV enthusiasts with limitedbudgets; those to whom the possession and use of a PV system is more important thanensuring that it is aesthetically installed.OPV, DSC and transparency: There is also, we believe, a significant opportunity specifically fororganic and dye-sensitized PV—and probably eventually for inorganic thin-film PV as well—forproducing truly transparent BIPV glass. The opaque cells that are integral to semitransparentBIPV glass have been a deal breaker for the use of BIPV glass in applications where visibility isimportant, such as in most windows. Truly transparent BIPV glass—with cells that are tintedbut not opaque—would open these applications to the possibility of BIPV glass, especially ifthe PV layer can be made uniformly tinted without spaces or any opaque traces. OPV and DSC NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  15. 15. NanoMarkets www.nanomarkets.netare the closest technologies to achieving this goal, but are still several years away fromstarting development of transparent BIPV, instead focusing on flexible BIPV.In NanoMarkets prior BIPV report, we had asserted that crystalline silicon wouldnt be able tomake BIPV glass truly transparent within the timeframe covered by the report. However, in the Page | 9last 12 months, Pythagoras Solar has successfully released its IGU product and scored ashowcase installation in the south wall of the 56th floor of the Willis Tower in Chicago (seesection E.4, below). The Pythagoras IGU looks like transparent glass with fixed internallouvers, and can be designed and mass-produced in custom layouts with the center of thewindow fully transparent. Since a fully populated Pythagoras IGU is effectively 14 percentefficient, leaving the center of the window completely open still provides an average effective7 percent BIPV module. E.3.2 Opportunities for Architects, Builders, and RoofersPerception of Green/LEED buildings has changed in the market over the last decade. Initiallyreserved for "enthusiasts" and so inherently a niche market, Green/LEED building productshave been proven to save significant operating costs over the lifetime of a building and so cannow be sold to non-enthusiasts just on the merits of costs and direct benefits.Green/LEED approaches to building construction often show the most benefit with newconstruction, where the frame and overall layout of the building can be designed to be mostin harmony with the local environment, including aspects such as shade structures, rainwaterrecycling, solar thermal hot-water, and use of recycled materials. Recent reports by peopletracking building construction trends indicate that the overall Green/LEED building marketgrew ~50 percent over the last two years, and could grow another 100 percent over the nextfive years; up to 25 percent of all new construction activity last year fell into this category.Conventionally, the BIPV market is classified as a sub-set of the PV market, which in turn isconsidered to be one part of the overall renewable-energy or "Green" market. However, BIPVmay also be considered as somewhat independent of other energy markets because otherrenewable energy products—except for solar thermal—cannot be attractively and affordablyintegrated into a building. From this other perspective, BIPV fundamentally competes withother high-end building materials for the same positions in the skins of structures.As a result, the BIPV market has very different dynamics compared to the mainstream/utilityPV market and the rest of the renewable-energy market overall. BIPV also has differentmetrics, needs to meet different codes, and will grow at different rates. For all of thesereasons, BIPV is a real, though certainly small, independent market today. The market will NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  16. 16. NanoMarkets www.nanomarkets.netsoon explode, however, when second-generation products gain traction as high-end elementswithin the portfolio of offerings available from architects, builders, and roofers.NanoMarkets sees the need for new codes to reduce BIPV electrical costs, since the codes ofbuildings arent set up for the 1000-V electrical potentials that can be generated by BIPV. Page | 10Codes exist to bolt conduit to an existing building, but the best results will always come from anew building designed for BIPV sidewall electrical integration. Micro-inverters could be usedto avoid this issue, but only with more cost and reliability issues.Architects: For BIPV to be incorporated into new building designs by architects, the costsmust be comparable to current building cladding materials. "Smart-Glass" today generallycosts $50-100/sq.ft., while passive glass for high-end commercial buildings may cost $5-20/sq.ft. NanoMarkets sees products from many different BIPV suppliers soon hitting thesame price range as Smart-Glass, which should trigger a tipping point in demand and createreal money-making opportunities. With a five-to-seven year ROI time for many BIPV productseven without government incentives, and with a two-three year ROI time for the mostattractive products, BIPV should soon become ubiquitous.Architects are generally very interested in new building products that may allow them todifferentiate themselves amongst their peers, and so tend to pull new products into themarket. However, the first showcase installation for any given product needs to be proven forat least a year before it will generally be accepted by the mainstream. If a product has beenavailable for more than a year and is warrantied, then most architects will consider it asviable—provided that it has been proven to meet all applicable building code standards.Builders: General contractors with responsibility to complete projects on time and on budgetmust be naturally conservative and tend to push-back against new products unless they arepositioned as obvious replacements for existing and trusted products. The many regionalcodes to which all building cladding materials must conform are the minimum.Most importantly, any viable BIPV product must be seen as a real "drop-in" replacement,where the complete BIPV module should ideally be able to be installed by standard manuallaborers with minimal special training. For example, "glaziers" put glass in a building and dontknow anything about plugging a window into anything. A lot of education and training is stillneeded so that most BIPV can be installed by standard building-trades people.Roofers: Since most roofs need to be replaced in 10-20 years, the roofing industry has beenestablished to handle both new construction and retrofits. With retrofit business favored inthe short-term due to malaise in new construction markets, roofers have been partnering NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  17. 17. NanoMarkets www.nanomarkets.netwith BIPV suppliers to create "turn-key" BIPV systems for specific regional sub-markets. Such"BIPV-in-a-Box" packages include 3-5 kW of panels, all electronics for grid-connection, and anymounting hardware needed for installation on one roof. A preventative maintenance serviceplan may be included. NanoMarkets sees BIPV-in-a-Box as one of the fastest ways to lowerbarriers to entry for small-scale installation. Page | 11In the U.S., a "Roof-Integrated Solar Energy" (RISE) national roof contractors association hasbeen established to offer a test to become a certified roofer for BIPV. Since BIPV includes both"BI" and "PV" sets of functionalities, this program is a great way for traditional "BI" trades-people to gain expertise in the "PV" side of things. Some people have also begun to use thephrase Roof-Integrated Photovoltaic (RIPV) for the sub-set of BIPV products designedspecifically for rooftops. E.3.3 Opportunities for Distribution and RetailThe most important BIPV-related opportunity for building materials suppliers is to formpartnerships with the PV firms to develop and produce fully-integrated BIPV products. Withoutsuch partnerships, it is unlikely that most building products firms would have all the necessaryexpertise to get into the BIPV market themselves. Indeed, they might well find themselves in aposition where BIPV is in direct competition with what they offer.Through such partnerships, building materials firms can expand their product offerings toinclude higher-value BIPV products that can be more profitable than the conventional buildingmaterials. NanoMarkets expects "Green/LEED" building products to significantly outperformother high-end building products for the near future. Distributors and retailers who establishreputations for providing quality and reliable BIPV products should outperform theircompetitors.Service and warranties for both BI and PV sets of functionalities are needed by customers, andthe best second-generation BIPV product providers take on this responsibility. In thispreferred scenario, the rest of the distribution chain merely passes down the manufacturerswarranties to the contractor responsible for the physical installation.E.4 Firms to Watch E.4.1 Ascent Solar Technologies (NASDAQ: ASTI)Ascent Solar has demonstrated a laminate product called WaveSol Light. This product isclaimed to be 8-9 percent efficient, and the company established a second-generation flexibleBIPV laminate CIGS product with Underwriters Laboratory (UL) certification. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  18. 18. NanoMarkets www.nanomarkets.net Summary of BIPV Markets 25,000 20,000 Page | 22 $ Millions 15,000 10,000 Glass Flexible BIPV products 5,000 Tiles and floating panels 0© NanoMarkets, LC Total BIPV Markets--2011-2018 25,000 20,000 15,000 $ Millions 10,000 5,000 0 2011 2012 2013 2014 2015 2016 2017 2018 © NanoMarkets, LC NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  19. 19. NanoMarkets www.nanomarkets.netChapter One: Introduction1.1 Background of this ReportBuilding-Integrated Photovoltaics (BIPV) is a new and dynamic market with complex sub-markets and very different market entities pulling diverse BIPV technologies into use. As an Page | 23extension of the global photovoltaics market, both large established PV module suppliers aswell as small niche architectural firms are trying to push BIPV into the market. Historically, thevolumes sold of BIPV products—relative to PV products as a whole—so far have been low dueto both a lack of demand and a lack of dedicated products for the building industry. However,NanoMarkets believes that the demand for BIPV would have been greater had dedicatedproducts been more widely available.As additional dedicated BIPV products are released to the market, we think that the keydecision makers are discovering new ways to add value to buildings. Ultimately, for BIPV toyield solid business opportunities, architects, builders, and roofers all must work with provensolutions, and proven BIPV technologies to provide another way to win new customers/clients.Grid-connected BIPV is not just for "enthusiast" or "Green" people anymore, and "bankable"BIPV can now provide an attractive return-on-investment time for many buildings in manylocations. Depending upon incentives and lease-back financing schemes, BIPV can potentiallyreduce the total costs of constructing homes and commercial buildings, and may also addsignificant value to building retrofits.The combination of dedicated and bankable BIPV products with proper financing can open upnew addressable markets. From the supply perspective, BIPV offers new revenue-streams forPV panel suppliers and new differentiation in the market-space for architects, builders, androofers. 1.1.1 BIPV Market DriversAesthetics: The first generation of BIPV systems, often referred to as Building-AttachedPhotovoltaics (BAPV), were primarily architectural in nature. They consisted of attempts tomake the PV panels more unobtrusive by choosing thinner panels and installing them parallelto the roof surface or even hidden on a flat roof. In addition to helping PV appeal to a broaderaudience, the first generation of BIPV also was intended to meet the requirements of certainlocal governments, which either mandated BIPV or required that PV panels be hidden fromview despite a lack of dedicated products designed to achieve these requirements. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  20. 20. NanoMarkets www.nanomarkets.netThese first-generation BIPV systems are not our primary concern in this report. Rather, we aremore interested in BIPV products as opposed to BIPV design. The BIPV products we have inmind here are those that integrate smoothly with building surfaces. At a minimum, they arelaminated on roofing or wall materials; more specialized products also serve as roofing orcladding themselves or even as skylights or other building features. Dedicated BIPV products, Page | 24properly installed, simply look better to most observers than BAPV, and so provide a lastingvalue.Costs: Inevitably, the cost of a BIPV system will be higher than a standard PV panel of asimilar performance. Due to the dedicated design of second-generation BIPV systems and thedistinctly different sub-markets for roofs, windows, and sidewalls in buildings, any given BIPVproduct will see lower volumes compared to mainstream "utility panels" and will thus notenjoy the same economies of scale. However, with demand expected to steadily increase overthe next eight years, NanoMarkets expects that BIPV products can be made on dedicatedproduction lines and so will see steady reductions in manufacturing costs.The ultimate goal for BIPV systems is that they can lower the total costs of construction of aBIPV-enabled building, since the cost of using BIPV materials will be lower than usingconventional building materials in conjunction with conventional PV systems. However, for theBIPV market to establish itself, in the next few years we are going to need to see proof thatthis kind of economics can be established for BIPV. And this strategy is where theopportunities lie. If costs for BIPV begin to reach the point where BIPV products can bepositioned as part of a standard portfolio of high-end building materials, then the demand isexpected to explode.Since cost remains a significant part of the demand equation, the dynamics of pricing must beconsidered. NanoMarkets considers that BIPV suppliers will target certain price-points inreference to existing high-end building materials and options. In such a scenario, the demandis not particularly "elastic" with price, but instead should spike up once threshold levels areachieved. 1.1.2 Three Approaches to Building Integration: Rigid, Flexible, TransparentFrom a product perspective, NanoMarkets believes that the BIPV market fits best into threebroad categories based on the function that the BIPV products serve in the building envelope.These categories are (1) rigid BIPV tiles and panels, (2) flexible BIPV products and laminates,and (3) transparent or semi-transparent BIPV glass products. Each of these product categoriesare at a different level of technological maturity and also have significantly differentaddressable markets. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  21. 21. NanoMarkets www.nanomarkets.netRigid products: Rigid BIPV products generally rely upon crystalline silicon (c-Si) or multi-crystalline silicon (mc-Si) wafers as the cells from which to build customized building claddingstructures. The silicon wafers required may be obtained from any supplier, and the modulemanufacturing required may not be significantly different from that needed to createconventional PV panels, which are overwhelmingly rigid. Page | 25However, the aesthetic and functional and regulatory requirements of BIPV create newopportunities for product differentiation compared to mainstream PV panels. Consequently,NanoMarkets believes that there are distinct opportunities in this space that BIPV can tap intoin a manner not available to conventional PV panels.Rigid BIPV products that are available or planned include tiles that are designed to interlacewith conventional roofing tiles or cladding materials; larger tiles that serve as entire roofportions or wall portions themselves; and thin, flush-mounted panels that overlayconventional roofing or siding but are specifically designed for flush mounting on buildings.Flexible products: Flexible PV laminates are a newer direction for BIPV than the rigid systemsdescribed above. Besides flexible PV laminates, which are designed to be glued onto existingbuilding materials such as metal roofing, there are also products like flexible shingles thatinterlace with conventional asphalt shingles. Also coming soon are flexible building materialswith PV cells built or deposited directly onto them. These products aim to integrate the PVpanels more completely with building materials than todays laminates, which are applied in aseparate installation.The flexible product segment of the BIPV market clearly involves novel products and as suchrepresents a riskier business proposition than the rigid BIPV product segment describedabove. The flexible alternatives are also reliant on using newer materials platforms, primarilythin-film and organic PV, since these materials are flexible and conventional c-Si PV is not. It isstill an open question as to which of the several thin-film/organic approaches to PV is bestsuited to flexible PV.Transparent: BIPV glass products can generally be considered as a sub-class of "SmartWindows," and specifically are similar to electrochromic windows in that active electronics areinvolved in both functional types. In many cases, transparent BIPV based on thin-film PVtechnology is a way of using glazing to make PV cells and modules into decorative buildingfeatures. Several companies have announced plans to integrate semi-transparent thin-filmabsorber materials with transparent conductors to compete directly with electrochromic glasswindows. Both amorphous-silicon and CIGS thin-films have been explored as the PV absorbermaterial. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  22. 22. NanoMarkets www.nanomarkets.netThe initial markets for BIPV glass are in skylights, facades, curtain walls, and shade structuressuch as canopies, and BIPV glass can often be easily built to custom dimensions and shapes,either by adjusting the number and spacing of crystalline silicon cells or by cutting thin-film PVpanels to size. The possibility of windows that are also PV panels should start being realized,but the manufacturing platforms necessary to produce glass of this kind in high volumes still Page | 26seems quite far off. Initial BIPV glass windows will be created on pilot lines with limited yieldsand profitability.1.2 Objectives and Scope of this ReportNanoMarkets has been covering the BIPV space now for more than four years and the PVspace for a few years longer. It has watched the BIPV sector emerge as one of the biggesthopes for turning PV into a substantial industry that might eventually be self-sustainingwithout government subsidies.With this history in mind, the primary purpose of this report is to examine and quantify therevenue-generating opportunities for BIPV over the next eight years. The focus is primarily onhow BIPV and the different participants in the market can design and deploy productsspecifically intended for integration into buildings. We perform this analysis for each of theproduct classes mentioned above considering the various addressable markets for BIPV:residential and commercial/industrial and new construction and retrofits. We also considerthe sizes of the various BIPV markets, the roles and strategies of important firms in theindustry, and the various PV technologies as they relate to BIPV.In this report, we take the approach that BIPV products include those PV panels specificallydesigned for mounting on (or in) buildings. As we note above there are three kinds of BIPVproducts that fit that definition and we discuss all of these in depth in the main body of thisreport.It is important to note that this report does not focus upon design/architectural strategies toattach conventional PV technology onto buildings (BAPV), for we consider BAPV as part of themainstream PV market. Nor does this report focus upon design/architectural strategies tointegrate conventional PV technology into buildings, though we realize that such workconstituted the first attempts to create BIPV, and so we acknowledge these projects as "first-generation" BIPV. NanoMarkets considers that first-generation BIPV approaches are nolonger competitive with the advent of "second-generation" BIPV technologies that have beencreated specifically to serve builders. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  23. 23. NanoMarkets www.nanomarkets.netThis report is international in scope. The forecasts are worldwide forecasts and we have notbeen geographically selective in the firms that we have covered in this report or interviewedin order to collect information. That is not to say that the markets and firms aregeographically homogeneous; in fact, the markets are concentrated in certain geographicareas and the firms are concentrated around these markets. Largely, the geographical bias of Page | 27BIPV—and hence of this report—is determined by the size of the PV market as a whole incertain countries and regions.1.3 Methodology of this ReportThe information for this work is derived from a variety of sources, but principally comes fromprimary sources including NanoMarkets ongoing interview program of business developmentmanagers and technologists involved with photovoltaics of all kinds. We also drew on anextensive search of the technical literature, relevant company Web sites, trade journals,government resources, and various collateral items from trade shows and conferences.Some of the historical and background information has also been taken from our 2010 BIPVreport and, in addition, we have built on the research we conducted for other recentphotovoltaics-related reports including "Thin-Film Photovoltaics Materials Markets—2011 andBeyond" from December 2010 and "Dye Sensitized Cells: Materials, Applications andOpportunities: 2011" from April 2011 and "Materials, Applications and Opportunities withinOrganic Photovoltaics: 2011" also from April 2011. We have also incorporated analysis fromour "Next-Generation Smart Windows: Materials and Markets: 2011" report. Whereinformation has been used from an earlier report, it has been reinvestigated, reanalyzed, andreconsidered in light of current developments and updated accordingly.The forecasting approach taken in this report is explained in more detail in Chapter Four, butthe basic approach taken here is to identify and quantify the underlying needs and marketsthat are served by BIPV products; consider the specifics of the applications and the types ofproducts available or under development; and assess the competitive landscape to determinethe suitability and likely volume of each of the BIPV types over the next eight years. Thestated plans of the key firms are of course of special interest, although NanoMarkets criticallyconsiders these claims in light of all available data.1.4 Plan of this ReportIn Chapter Two, we look into recent commercial developments of second-generation BIPVproducts designed specifically for integration into buildings, including the major sub-marketsof rigid, flexible, and transparent products. We also analyze the BIPV product mix in terms of NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  24. 24. NanoMarkets www.nanomarkets.netunderlying PV technology: crystalline and multi-crystalline silicon wafers, amorphous-siliconthin-film, CIGS, and DSC and organics.In Chapter Three we explore the demand side by analyzing the overall dynamics of globalbuilding markets and reviewing the differing expectations of architects, builders, and roofers. Page | 28This section includes a discussion of the cost of BIPV relative to that of conventional buildingmaterials plus conventional PV panels for roofs, walls, and windows.Finally, Chapter Four contains our eight-year forecasts of the markets for BIPV in each of thecategories of rigid, flexible, and transparent products. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259

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