Bifacial solar technology appears to have survived the hype cycle and broken into the mainstream, if conversations at this year’s Solar Power International and recently announced projects are any indication.
Last August, I reported on the potential for two-sided panels, as well as the hurdles for their widespread use. At the time, a lack of data about cost and efficiency was keeping developers from fully investing in the what-if technology. Bifacial remained on the cusp of a breakthrough — a position it’s occupied for years.
Now, industry watchers such as Becca Glazer, a senior director on the structured finance team at solar developer and financier Sol Systems, say bifacial has evolved beyond its “theoretical” status at the beginning of 2019 to “fairly commonplace” today. That was literally on display at SPI, the solar industry’s largest North American conference held in late September, where recently released bifacial panels appeared at booths from companies such as Trina Solar and Hanwha Q Cells.
Several developments during the past year have helped boost bifacial’s stock.
At the beginning of 2019, the International Electrotechnical Commission released standards for measuring the gain in power generation associated with bifacial products. That provides the industry with concrete guidelines for assessing the power value of two-sided panels.
Then in June, the Trump administration handed down a surprise exclusion to Section 201 tariffs for bifacial modules, drawing more attention to the technology.
That lasted only a few months before the administration reversed course and ended the exclusion in October. Though the exemption would have helped bifacial match single-sided panels in price in the U.S., the technology has already made significant global progress: New research from Wood Mackenzie Power & Renewables shows that bifacial monocrystalline PERC modules are only $0.01 per watt more expensive to produce than single-sided panels of the same type.
Real-world applications have also fostered investor confidence. Canadian Solar in May logged a 1.8-gigawatt deal — its largest ever — for multiple projects in North America, which it will partially fill with bifacial panels. In June, China-based manufacturer Jolywood announced it will supply a project in Dubai with 320 megawatts of bifacial panels.
For an industry always looking for the next big thing, bifacial seems to have officially arrived.
“It no longer feels like this far-off trend,” said Glazer. “It now feels like an industry reality.”
The removal of the bifacial exclusion may defer that reality in the U.S. for a time, because bifacial products now won't be cost-competitive until the Section 201 tariffs step down further. But WoodMac senior solar analyst Xiaojing Sun said any setback will only be temporary.
When the administration unveiled the bifacial exemption to Section 201 tariffs in June, it was met with mixed reactions from the solar industry. Companies that have dropped significant investments into U.S. manufacturing to dodge duties, like First Solar, were “disappointed” with the exclusion and pushed for its repeal. But for foreign manufacturers like Trina, the exclusion would have been a big help. The Solar Energy Industries Association told Greentech Media in September that it “strongly supports” the exclusion.
The change in policy will offer the most benefit to companies like First Solar that manufacture in the U.S. and specialize in utility-scale products. Companies that manufacture outside the U.S. were in the midst of a “huge push” to transition manufacturing to bifacial in response to the exclusion, according to Jim Day, Trina’s North America head of sales and marketing. With the exclusion gone, it's unclear how those companies will respond.
Though Day suggested there’s still some apprehension within the industry about the nascent nature of the technology, he acknowledged that most solar manufacturers are interested in adding bifacial to their portfolios, if they haven’t done so already.
Now that bifacial products will again face Section 201 tariffs, buyers may shift their strategies. But Sun said some developers may still favor bifacial if it can reduce overall system costs despite the higher per-panel price.
"There's momentum in bifacial that tariffs can't take away," she said.
According to WoodMac, bifacial module shipments will make up about 30 percent of product shipped to the U.S. in 2022 even in a scenario with low uptake (which does not take into account a revocation of the bifacial exemption). In a high-uptake scenario, bifacial demand could exceed 50 percent of total U.S. demand by that year.
“The technology stands on its own and is being deployed more broadly,” said Glazer. “My expectation is that we’ll continue to see more deployment of bifacial models, regardless of that tariff.”
Skepticism, meet confidence
In the past, quantifying added value from two-sided panels created a sticking point for developing bifacial projects. As Sun noted in a recent report, “bifacial module vendors and developers are frustrated about the technology’s perceived poor bankability.”
The standards the International Electrotechnical Commission released in January helped some, but Sun said gaining the industry's complete confidence will just take time.
Glazer agreed, though she noted that Sol Systems is actively financing several portfolios that include bifacial. Those projects add up to a total of 50 megawatts from both its tax equity and sponsor equity platforms.
In conversation with lenders at SPI, Glazer also said she heard more confidence in how independent engineering reports quantify bifacial gains.
“Earlier in the year, I was getting a bit more skepticism from lenders,” said Glazer. “Now it sounds like there’s more comfort underwriting that technology in a way that more well-known technologies are already underwritten.”
The key to financing bifacial projects, Glazer said, is finding the balance between anticipated gains in output and the marginal increase in cost. According to her, an increase in yield of just 3 percent to 5 percent is now enough to make bifacial projects pencil out economically. Developers and financiers will also have to consider added variables such as ground surface reflection, spacing between rows and weather conditions at a site to determine how effectively two-sided panels can expand output.
Those additional factors mean bifacial likely won’t make sense in all applications. But Joe Song, vice president of project operations at Sol Systems, said the panels are quickly becoming the “default starting place” for projects that use trackers, which adjust panels as the sun moves through the sky.
Because of the halting progress for the technology, WoodMac’s Sun presents a “cautiously optimistic” outlook for bifacial’s immediate future — a point of view perhaps now deserving an added dose of caution due to the exclusion change. Before the administration dropped the exemption, the consultancy expected global bifacial capacity to jump from about 8.8 gigawatts currently to more than 21 gigawatts by 2024, with China and the U.S. leading deployments.
The folks at Sol Systems also recommend a measured approach. Though the industry appears ready to embrace bifacial, Glazer said caution is still key as developers build their first projects.
“The name of the game right now…is just balancing an openness to innovation with a disciplined approach to risk management,” said Glazer. “We're in an interesting place in the industry where margins are coming down, there's a lot of competition and there's a lot of transition.”
“I think the companies that will be most successful are those that are able to strike that balance.”