By Isabella Kaminski

IMS Research estimates that nearly 80% of solar PV modules were produced in Asia in 2010 and that the share will rise this year.

Large Taiwanese and Korean electronics suppliers such as Samsung, LG, AUO and Taiwan Semiconductor have all recently announced impressive expansion plans for their solar business segments despite fears of a solar PV module oversupply in the market.

According to IMS Research, there will be an oversupply of solar PV modules this year following rapid cell and module capacity increases in 2010 comwith lower incentive rates and the slowing of installation growth. In particular, small Tier 2 suppliers are predicted to be most affected, with larger Tier 1 suppliers still able to sell the majority of their products.

However, researchers believe the long-term outlook remains positive and that total industry demand will continue to grow at double-digit rates on average for the next four years. AUO Optronics, a Taiwanese supplier most known for its flat-panel displays has agreed a 1.4 GW cell production joint venture with SunPower, while Samsung recently announced a joint venture producing polysilicon with MEMC.

Sam Wilkinson, PV Research Analyst for IMS Research, says: “The expertise of these large Asian suppliers at large-scale production in similar fields and their willingness and ability to invest significant capital is likely to mean that they are able to quickly reach low-cost and high-volume production, and they certainly have the potential to be serious competition for today’s market leaders within a few years.

“Many suppliers are currently experiencing a lull in shipments, and it is likely that demand may remain weak until later in the year. The entrance of a number of large electronics suppliers which will offer competitively-priced PV components is likely to add some further obstacles for existing suppliers in an already volatile market.”