Solar Industry Analysis

1. Solar Industry Analysis NY Investing Meetup Aug 31, 2010 Praveen B. Kedar CEO Niveza Inc. Investor Exchange www.niveza.com pkedar@niveza.com

2. Agenda • Interesting facts. • Economic drivers. • Industry stats. • Cost Curve. • Market by country. • Demand Forecast by country. • Risk Factors. • Value Chain. • Major Players. • Niveza Investor Exchange.

3. Interesting Facts • The earth receives more energy from the sun in just one hour than the world uses in a whole year. • Two billion people in the world have no access to electricity. For most of them, solar photovoltaic would be their cheapest electricity source, but they cannot afford it. • Solar energy's nuclear power plant is 93 million miles away. • An average crystalline silicon cell solar module has an efficiency of only 15% and thin film has an efficiency of 6%. • A Megawatt is 1,000,000 Watts; a Gigawatt is 1000 Megawatts. • Around 50% solar cells are produced in China and Taiwan. • Germany is the largest consumer of solar energy.

4. Economic Drivers • Strong focus on energy security by governments worldwide. • Significant investments by venture capital has accelerated research resulting into cost reduction. • Government incentives combined with private financing has significantly reduced up-front installation cost. • Rising energy prices and fast declining traditional energy sources. • Regulatory environment like carbon credits, feed-in-tariff. • Green revolution becoming mainstream necessary for mass adoption until solar can compete with other sources.

5. Industry Stats • Solar represents 1% of total energy supply. • 30% growth in demand over the last few years. • Photovoltaic (PV) installations grew by 20 percent to 7.3 GW in 2009. • PV prices declining by 4% per annum. • Revenue increased to $38B in 2009. • Grid parity expected by 2015 according to DOE. • Grid electricity costs around 8-10 cents/KW hour whereas solar energy costs around 35 cents for residential, 25 for commercial and 20 for industrial. • Solar costs 10-12 cents per KW hour with incentives and volume discounts similar to industrial purchases. • Every doubling in production capacity of PV modules is expected to result in a 20% cost decline.

6. Cost Curve U.S. EIA estimates of the declining costs of various forms of solar energy

7. Market by Country

8. Demand Forecast by Country Source: FSLR estimate

9. Risk Factors • The financial crisis is making it more difficult for solar projects to get funding. • Governments under pressure for fiscal discipline have reduced incentives. • Sluggish economic growth expected may put downward pressure on oil and traditional energy prices. • In 2009, the right to emit one ton of carbon fell from €30 on the EU carbon market to €11.80, needs to trade around €25 for viability of the projects.

10. Major Players • FSLR – US based, largest thin film manufacturer. • SPWRA – US based, highest PV panel efficiency at 22%. • WFR – US based, manufacturer of polysilicon. • STP – Largest Chinese manufacturer of PV. • TSL – Large Chinese manufacturer of PV. • YGE – Large Chinese manufacturer of PV • AMAT – US based, Manufacturer of equipment. • TAN – Less pure play ETF, weight based on % of revenue. • KWT – More pure play ETF, at least 66% of revenue from solar.

11. Value Chain • Raw Silicon – • Equipment - AMAT • Ingot/Wafers – WFR • Solar Cells – FSLR, SPWRA, STP • Solar Panels – FLSR, SPWRA, STP • Distribution – Phoenix Solar • Installation - Phoenix Solar • Service - Phoenix Solar

12. References • SolarBuzz • First Solar • U.S. EIA • US DOE

13. Thanks! Praveen B. Kedar CEO Niveza Inc. Investor Exchange www.niveza.com pkedar@niveza.com