GREAT IS A GREAT PLACE TO START
Does a manufacturing process really need 411 quality control points? Some would call that obsessive, wasteful even, and they’d be right. We worked out you only need 411 quality controls to make the best products possible.
Then the job becomes changing what’s possible. For example, we’ve tried and tested our PV products again and again, to the point where we’re so confident in them that we offer a 25-year performance warranty. Even more testing and the consistent excellence of our products in the field have grown that confidence to the point where we will soon be offering a 30-year option. And, if we can hit the 30-year mark, well then… you get the idea.
As much as we’re focused on delivering the best products of tomorrow, we’re also proud of the standards we set today. These are illustrated by the terms of our performance warranty, which guarantees that the actual power output of a module will be no less than 97% of the labeled power output during its first year of operation, and will decline by no more than 0.7% annually so that by the end of year 25 the actual power output will be no less than 80% of the module's labeled power output. In addition, Canadian Solar has expanded its product warranty covering workmanship and material defects to 10 years.
"We are proud of our ability to offer an enhanced warranty policy that, combined with our positive power tolerance and our insurance policies, provides the best value in the industry,” said Dr. Shawn Qu, Chairman and Chief Executive Officer of Canadian Solar Inc. “These enhancements underlie our confidence in our manufacturing and quality control processes, and our commitment to the success of our customers," he added.
And Dr. Qu’s confidence has a solid foundation: From incoming material selection to the assembly of finished products, Canadian Solar applies strict step-by-step procedures that ensure the performance of each component in every module.
The design process includes every test imaginable: durability, UV resistance, degradation rate and extreme temperature variation, as well as mechanical performance in the face of torrential rains, high winds and heavy snowfalls. There’s no room for inferior components or workmanship. And this ensures our panels will work across a wide range of applications as well as stand up to harsher conditions than competitive products.
Getting down to specifics, 158 of our 411 quality control points are for incoming materials, while 62 are for raw materials processes and the others for production control. Every module goes through the following:
- Electroluminescence (EL) testing: a 100% EL screen test to eliminate cell or module defects.
- Cleaning: 100% module visual inspection and clean before packing
- Testing and analysis: performance reliability, mechanical and chemical tests of raw materials and components. This is done in warehouse, on the production line, in the testing lab and at other 3rd parties.
- Machine testing: advanced automatic equipment in testing and manufacturing process.
- Lab testing: In 2008 Canadian Solar commissioned the first module manufacturer-owned photovoltaic reliability testing laboratory to meet ISO/IEC 17025 (Accreditation Criteria for the Competence of Testing and Calibration Laboratories). The laboratory has total area space 3130 square meters and employs 23 full time technicians.
In addition, as a tier one module manufacturer, our products are used all over the world. As a result they’ve been tested by local standards authorities, banks and independent auditors in Australia, USA, Japan and many other countries, where they’ve delivered excellent results and proven top performance across the board. Even so, we see this as no more than a great beginning. The future of solar energy promises so much more. Which is why we have a staff of over 400 scientists, engineers and technicians working on it today.
OIL AND SOLAR - A PHANTOM RELATIONSHIP WITH REAL CONSEQUENCES
Given that oil and solar energy compete in different energy sectors, for the most part, simple logic dictates that price changes in one should not really affect the other.
According to Bloomberg, solar doesn’t compete with oil as a source of electricity except on small islands and in some crude exporting countries. Oil generates less than 1 percent of the U.S. electricity power supply and 5 percent globally. And yet changes in the oil price have had a long-standing impact on the attractiveness of solar energy to investors.
Nevertheless, it would seem the correlation between oil and solar is little more than a psychological link in many investors minds. According to a report in The New York Times’ green blog analysts believe this phenomenon is “…a sign of oversimplification by investors, who lump renewables together and expect them to rise as old energy, or fossil fuels, decline. “
“It’s a guttural connection people make, based more on feeling than on facts,” said Ron Pernick, a researcher quoted in the report. Nevertheless, when the price of oil goes up, solar stocks almost always rise along with it, and vice versa. The effects of the oil price on solar are real.
“Nitin Kumar, a well-respected analyst in the solar space published a research note in October that studied the link between the crude oil price and solar for the first time. The bottom line is that we are starting to see solar stock trading up and down with the whole energy sector,” as Dr. Shawn Qu, CEO and founder of Canadian Solar, wrote in his LinkedIn blog.
“I have been in the solar industry for my entire 18-year career and I take it as compliment to all solar industry participants that solar has achieved such a prominent position. If the crude oil price can directly influence solar product demand, the day must come when we see solar energy production affect the demand for oil and gas.”
However, for the moment, it is clear that changes in the crude oil price affecting people’s investment in solar energy is driven more by emotional considerations than supply and demand in the oil energy market directly impacting demand for solar. The numbers reveal just how small the intersection of oil and solar in the electricity market actually is.
In the US, 39% of electricity is coal generated (still surprisingly high), 27% gas, 19% nuclear, 7% hydro, 6% renewables and only 1% oil.
After the Fukushima Nuclear double-meltdown accident in Japan, 27.6% of electricity generation is now from coal, 42.5% from LNG, 8.6% from hydro, 6.4 from renewables, while 8.3% is from oil.
In the European Union (EU 27), it’s 28% coal, 16% gas, 2% oil, 27% nuclear, 12% hydro, 7% wind and the remaining 8% from solar and other forms of energy.
While in China, 74% comes from coal, 2% from gas, less than 3% from wind and a mere 0.16% from solar. The remaining power is provided by hydro, nuclear and others.
“It would appear that, by and large, we don’t really burn that much oil for electricity, and the cost of electricity is more related to coal and gas than oil,” said Dr. Qu. “Meanwhile, a significant portion of solar products goes to the distributed power generation market and serves retail customers. The retail electricity price, which has seen a rising trend in recent years, is mainly affected by transmission and other fixed costs rather the input fuel,” he said.
Nevertheless, over the long term, the writing is on the wall. Cost of production of solar energy will continue to fall, while efficiencies will rise. And it is safe to assume that the reverse is true of oil and all other fossil fuels. The implications are clear for energy investors who take a big-picture view that spans decades rather than months or years.
And what could be better proof of this than the fact that the world’s largest crude oil producer, Saudi ARAMCO has chosen Canadian Solar to partner in developing the largest ground-mounted PV system in Saudi Arabia.