BOSTON -- Some notable fund managers are betting on solar energy shares, expecting a wave of industry consolidation and lower costs to pay off for the notoriously volatile industry.

The optimists, a mix of specialized environmental managers and mainstream investors, are going against several trends, since solar companies have already had a sizeable run-up this year and more fund managers have been selling the stocks than buying them.

That has not deterred Fidelity Growth Company Fund manager Steve Wymer, who has been talking up the new competitiveness of solar power and has been steadily purchasing shares of panel maker First Solar Inc. Among mutual funds, his is now the largest holder of the stock.

Solar plants coming online in 2019 will generate electricity for $119 per megawatt hour, according to estimates from the U.S. Department of Energy. That is still more costly than some new coal plants, projected to produce electricity at $96 an hour, but down sharply from the $396 the agency projected for solar in 2016 four years ago.

The U.S. industry has benefited from federal subsidies and import tariffs, while concentrating on large-scale solar projects promising regular income. In addition, solar companies have done several deals allowing them to combine operations like manufacturing and installation.

"The reason we're bullish is that solar has finally reached grid parity" in many regions, said Ian O'Reilly, who helps run the Pioneer Global Ecology fund.

Buying In

Since last year, O'Reilly's $1.5 billion Pioneer fund has become a significant holder of equipment makers SunEdison Inc and SunPower Corp.

Others who have cited falling costs as a reason to invest in solar stocks this summer include the managers of Royce Opportunity Fund. Another well-known solar backer is David Einhorn's closely watched Greenlight Capital hedge fund, now SunEdison's top investor.

Andrew Cupps, president of Cupps Capital Management in Chicago, said his firm earlier this year had begun buying shares of SunPower and residential installer SolarCity Corp, whose largest shareholder and chairman is Tesla Motors Inc Chief Executive Officer Elon Musk.

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