According to newratings.com, RBC markets yesterday produced a research note on Evergreen Solar. The analysts mention that the company’s total product gross margin is expected to decline to under 10% by the end of 2007 and this along with other issues is seen as grounds for concern.

For all that, what Evergreen has got absolutely right is to take a bet years ago on silicon prices rising and offering a "silicon lite" approach to solar power.Their patented string ribbon technology allows them to use half as much silicon - typically up to 60% of the cost of the raw material inputs.

If silicon prices had even just stayed at $15 per kilo as they were in 2000 instead of reaching $60 and sometimes much more, the massive increase in solar production would have seen some substantial price falls. Instead, we have seen solar module prices remaining fairly constant at between 5 and 6 dollars per watt, according to the Solar Buzz Index. And I might add, government subsidies for solar across the globe have played their own perverse role in this. They actually served to not make it in the interests of solar producers to reduce costs by crowding out more price competitive solar solutions.

The great solar silicon shortage - I am told - will last until 2008. So could we be heading for a silicon glut after then?

That really could give us some falling solar prices at last.

Evergreen closed down today at 8.66 a share.