German engineering firm Siemens is closing down its last solar energy business, thereby calling off a seven month search during which it failed to find a buyer.
The company made plans to divest its solar business in October last year, after its investment in thermal solar installations company Solel from Israel proved unprofitable in a market heavily flooded by cheap Asian components.
There were talks with potential buyers, but they led nowhere. "There was no sign of a transaction which would have taken into account the interests of clients, staff, investors and the company itself in an adequate way," Siemens said in a statement.
The winding down is to affect some 280 employees, mostly Israeli-based, and will come into full effect in spring 2014. Siemens CEO Peter Löscher purchased Solel in 2009, convinced the CSP sector would grow quickly and the investment would pay off, but instead it ended up costing Siemens about €1bn.
Siemens also ceased production of photovoltaic inverters in May this year. The company is no longer contributing to the Desertec project, which aims to bring electricity from northern Africa to Europe.
“Photovoltaic power systems have dominated the market prices and reduced CSP to a niche market. On the other hand, the photovoltaic market is characterized by surplus capacities, price pressure, and profit margin pressure. Factors such as the recession, the euro crisis, and more restrictive subsidy policies continue to drive an ongoing process of market consolidation,” said a spokesperson at the company.
After a nine-month investigation, EU regulators have found that Chinese manufacturers have been selling solar panels, cells and wafers to European customers at prices far below market value. Solar energy parts made in China now account for 80 percent of the EU market, and many European companies are now facing bankruptcy as a result, the commission said in a statement earlier this month.