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Tickers in this Article: CSIQ, SOL
Canadian Solar Inc. (CSIQ) has supplied its CS6P-P solar power modules to Engineering, Procurement and Construction Contractor TSK Solar for the "San Fermin" solar power plant. The solar power plant with a generation capacity of 26 MW is developed by TSK Solar in collaboration with Uriel Renewables inc. and Coqui Power LLC.

TSK Solar power plant is located in the North Eastern town of Loiza in Puerto Rico. This region is very much prone to hurricanes, tropical storms and flooding. The power plant will use Canadian Solar's high quality and high-performing CS6P-P solar power modules to combat these weather hurdles.  Driven by the nature and location of the project, the electrical equipments are installed two to four meters above ground. They are well-designed to resist winds with a speed of up to 260 kilometers per hour.

San Fermin solar power plant project is the first photovoltaic project in Puerto Rico that will meet the technical requirements of the Puerto Rico Electric Power Authority. The electrical frequency of the plant is variable and its voltage can be regulated even in case of abrupt fluctuations in solar intensity. The project is expected to be completed, and connected to the national grid by December 2012.

The CS6P-P solar power modules feature a positive power tolerance in the range of 0 to 5W, has a robust frame to up to 5400 PA load anti-reflective with self-cleaning surface, exceptional performance at low irradiance and high energy yield at low Nominal Operating Cell Temperature ("NOCT"). Besides these features, the company has a product warranty of 10 years on materials and workmanship and a 25 year warranty on linear power output. Above all, it recently received the highest PV USA (PTC) ratings that prove that it is a universally recognized indicator of a solar system's real performance and power output.

As a result of its brilliant features, CS6P-P solar power modules stay in high demand. Last month, the company had made an announcement for the supply of its CS6P-P modules for Turkey's first and largest governmental solar PV project, which will be installed by Gehrlicher Merk Solar. In May this year, the company had supplied 3.3 MW of CS6P-P modules solar modules for a PV project in Bulgaria.

The other peer solar companies also seem busy in solar module supply agreements in which they are specialized. One of the company's peers ReneSola Ltd. (SOL) had recently entered into an agreement with Cummings Properties for the supply of 512 kilowatts ("kW") of its high-quality, and high-efficiency solar modules. Further, ReneSola had announced that its high-wattage 300 W and 305 W 72-cell poly line is ready for delivery from its east and west coast storehouses in the United States.

Canadian Solar is a vertically-integrated manufacturer of silicon ingots, wafers, cells, solar modules (panels) and custom-designed for solar power applications. The company designs, manufactures and delivers solar products and solar system solutions for both on-grid and off-grid use to customers worldwide.

Canadian Solar caters to a geographically-diverse customer base spread across its key markets in Germany, Spain and the U.S., as well as emerging market opportunities in France, the Czech Republic, Italy, South Korea, Canada, Japan and China. The company's other major source of revenue is the implementation of solar power development projects in rural areas of China, primarily in conjunction with government organizations.

However, we prefer to remain on the sidelines due to the industry-wide oversupply that leads to sharp fall in Average Selling Prices, tepid module demand in Europe and rising competition in the market. Given the industry wide high inventory level, we do not foresee any short-term improvement in margins for the company. The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.

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