Japan demand sees Solargiga source more sales from overseas

Solargiga Energy, a leading producer of silicon ingots and wafers that are used to make solar cells, aims to source half of its sales from overseas markets this year - up from 40 per cent this year, partly owing to higher demand from nuclear crisis-hit Japan.

Demand from Japan would rise because the earthquake and nuclear radioactive leakage crisis had led to the shutdown of nuclear power plants, whose capacity would need to be replaced by alternative energies, said Hsu You-yuan, the chief executive of Solargiga.

'We expect to get more orders not only from existing customers, but also new ones in Japan.'

CLSA Securities solar sector analyst Charles Yonts estimated the Japanese government might subsidise the installation of an additional 1,000 megawatts of solar panels to help combat power supply shortages, which would worsen as the summer approached.

This was on top of his pre-quake estimate of Japan's 1,500 MW of demand for this year.

Demand from Italy, which accounts for about 25 per cent of the global market, is expected to drop because of cuts in government subsidies in the next few years.

However, following Japan's nuclear disaster, Italy had delayed this year's subsidy cut by three months and its proposed cap on the output capacity of solar panels to be subsidised in future years looked increasingly unlikely to be realised, even though subsidies for each panel would be cut, Hsu said.