Shares of SolarCity Corp . SCTY jumped 7.3% after the company announced that it has built the world's most efficient rooftop solar panel. These panels have been designed to generate more power per square foot and yield more green energy than any other rooftop panel available in the market.
SolarCity's new panel with a 22.04% module efficiency surpassed a 21.5% efficiency of SunPower Corporation's SPWR X-Series modules. This was confirmed by Renewable Energy Test Center, a third-party photovoltaic testing company based in California.
According to SolarCity, the new panels will have increased power production capacity of 30-40% at considerably lower costs. The company also vouches for better performance of its panels compared to other products at high temperatures. Its cost efficiency is expected to help the company retain its competitive edge amid potential regulatory changes.
SolarCity expects to start manufacturing the modules at the Fremont plant and later shift the majority of production to its Buffalo, NY facility. The company expects production to be as high as 9,000-10,000 solar panels per day once the Buffalo facility reaches full capacity.
The company expects to install the new panels on rooftops and carports for homes, businesses and schools. These panels will also benefit utility-scale solar projects. The panels will be able to generate more electricity from the same land area, which will, in turn, bring down the overall cost of energy production.
Over the past few years, the solar industry has grown exponentially as panels became cheaper and more efficient. About 200,000 homes and businesses installed solar power in the last year alone. SolarCity now leads the residential solar power space, being responsible for one in every three residential installations in the U.S.
The company aims to continue offering solar power at attractive prices to its customers despite the impending expiration of a federal tax credit next year. Presently, the U.S. government gives a 30% credit to encourage residential solar installation.
Environmental considerations have been driving demand for alternative energy sources. Per the International Energy Agency, there are indications of continued growth in utility-scale solar power generation, which is projected to average almost 89 gigawatts ("GW") hours per day in 2016. In spite of rapid uptake, solar will still be just 0.8% of total U.S. utility-scale generation in 2016, indicating room for immense growth.
Solar growth has historically been concentrated in customer-sited distributed generation installations. The EIA expects utility-scale solar capacity to expand over 100% between 2014 and the end of 2016, with about 37% of this new capacity being built in California.
SolarCity currently has a Zacks Rank #4 (Sell). JA Solar Holdings Co. Ltd. JASO and ReneSola Limited SOL are some better-ranked stocks in the alternate energy space, both sporting a Zacks Rank #1(Strong Buy).