| SIC Codes: | 4911 |
| NAICS Codes: | 221114 |
Companies in this industry operate solar electric power generation facilities. Major companies include diversified electric utilities and independent producers E.ON (Germany), Enel (Italy), Iberdrola (Spain), Tokyo Electric (Japan), and NextEra Energy (US).
As with other power sources, demand for solar power is driven by residential, commercial, and industrial electricity demand, which increases with population and economic growth. Additionally, growing concern over environmental and geopolitical issues surrounding fossil fuels has boosted interest in renewable energy sources such as solar. Profitability is determined by government regulations and incentives, as well as technological factors. Large companies have an advantage in their ability to make heavy capital investments necessary to build solar power generation facilities. Small companies can compete by securing venture capital and utilizing government subsidies. The industry is highly concentrated: the top 10 utilities involved in solar power generation accounted for about 70 percent of the solar utility market in 2010, according to the Solar Electric Power Association (SEPA).
Solar producers use two technologies to convert energy from the sun into electricity: concentrated solar power (CSP) and photovoltaic (PV) power. CSP power plants account for about 20 percent of US solar energy capacity, PV for about 80 percent. CSP plants utilize heat from solar thermal collectors. Power plant-grade collectors typically take the form of parabolic troughs, solar dishes, or solar towers. Parabolic troughs, the most common collector at CSP plants, utilize long, parabolic reflectors that tilt with the sun as it moves across the sky. The reflectors focus sun rays on a receiver pipe filled with fluid. The heated fluid is used to produce steam, which in turn powers turbines just as in a fossil fuel or nuclear-powered system. (Not all solar thermal collectors are used for electricity generation; low-temperature collectors used to heat swimming pools are the most prevalent solar application in the US.)
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