**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION        Washington, D.C. 20549                  FORM 10-Q**

*(Mark One)*

þ     Quarterly report pursuant toSection 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended **March 31****,        200****9**.

o     Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to .

Commission file number: **00****1-14791**

**SOLAR ENERGY LIMITED**

(Exact name of registrantas specified in its charter)

| **Delaware**(State or other jurisdiction of                    incorporation or organization) | **76-0418364**

(I.R.S. Employer 

Identification No.) |
|-----------------------------------------------------------------------------------------------|--------------------------------------------------------|

**73200 El Paseo, Ste #2H, Palm Desert, CA 92260**

(Address of principal executive offices) (Zip Code)          

**(760) 773-1111**

(Registrant’s telephone number, including area code)

**N/A**

(Former name, former address and former fiscal year, if changedsince last report)

Indicate by check markwhether the registrant: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required        to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes þNo o.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company as defined by Rule 12b-2 of the Exchange Act:

Large accelerated filer oAccelerated filer oNon-accelerated filer oSmaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): YesþNoo

At May 20, 2009the number of shares outstanding of the registrant's common stock, $0.0001 par value (the only class of voting stock), was 18,423,309.

1

----

**TABLE OF CONTENTS**

**               
**PART I. - FINANCIAL INFORMATION**
     **ITEM 1.     FINANCIAL STATEMENTS**  3   Consolidated Balance Sheets as of March 31, 2009 (unaudited) and December 31, 2008   4   Unaudited Condensed Consolidated Statements of Operations for the three month periods ended March 31, 2009 and March 31, 2008 and the period from inception   5   Unaudited Condensed Consolidated Statements of Cash Flows for the three month periods ended March 31, 2009 and March 31, 2008 and the period from inception  6   Condensed Notes to Condensed Consolidated Financial Statements  8  **ITEM 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations**  14  **ITEM 3.    Quantitative and Qualitative Disclosures about Market Risk**  19  **ITEM 4T.  Controls and Procedures**  20                
**PART II. - OTHER INFORMATION**
     **ITEM 1.     Legal Proceedings**  20  **ITEM 1A.  Risk Factors**  21  **ITEM 2.     Unregistered Sales of Equity Securities and Use of Proceeds**  23  **ITEM 3.     Defaults upon Senior Securities**  23  **ITEM 4.     Submission of Matters to a Vote of Securities Holders**  23  **ITEM 5.     Other Information**  24  **ITEM 6.     Exhibits**  24  **Signatures**  25 **Index to Exhibits**  26 **

2

----

**PART I – FINANCIAL INFORMATION**

**ITEM 1.     FINANCIAL STATEMENTS**

As used herein, the terms “Company,”“we,”“our,”“us,”“it,”and “its”refer toSolar Energy Limited, a Delawarecorporation, unless otherwise indicated. In the opinion of management, the accompanying unaudited financial statements included in this Form 10-Qreflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of operations for the periods presented.        The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.

3

Return to Table of Contents

----

| **SOLAR ENERGY LIMITED                    (A Development Stage Company)**

**CONSOLIDATED BALANCE SHEETS** |
|------------------------------------------------------------------------------------------------------------|
|                                                                                                       |   |   |   |   |   |   |   |   |   |
|                                                                                                       |   |   |   |   |   | March 31, |   |   | December 31, |
|                                                                                                       |   |   |   |   |   | 2009 |   |   | 2008 |
|                                                                                                       |   |   |   |   |   | (Unaudited) |   |   |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| **ASSETS**                                                                                                 |   |   |   |   |   |   |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| CURRENT ASSETS                                                                                             |   |   |   |   |   |
|                                                                                                       | Cash |   |   | $ | 2,754 |   | $ | 13,853 |
|                                                                                                       | Other receivable |   | 37,833 |   |   | 37,833 |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
|                                                                                                       |   | TOTAL CURRENT ASSETS |   | 40,587 |   |   | 51,686 |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| **TOTAL ASSETS**                                                                                           | $ | 40,587 |   | $ | 51,686 |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| **LIABILITIES AND STOCKHOLDERS' DEFICIT**                                                                  |   |   |   |   |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| CURRENT LIABILITIES                                                                                        |   |   |   |   |   |
|                                                                                                       | Accounts payable and accrued expenses | $ | 100,355 |   | $ | 96,934 |
|                                                                                                       | Accrued interest - related party |   | 30,719 |   |   | 27,738 |
|                                                                                                       | Advances payable |   | 444,650 |   |   | 439,842 |
|                                                                                                       | Note payable to related party |   | 376,521 |   |   | 376,521 |
|                                                                                                       | Debenture payable, net of discount |   | 100,000 |   |   | 100,000 |
|                                                                                                       | Accrued interest |   | 29,184 |   |   | 26,008 |
|                                                                                                       |   | TOTAL CURRENT LIABILITIES |   | 1,081,429 |   |   | 1,067,043 |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| COMMITMENTS AND CONTINGENCIES                                                                              |   |   |   |   |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| STOCKHOLDERS' DEFICIT                                                                                      |   |   |   |   |   |
|                                                                                                       | Common stock, 50,000,000 shares authorized; $0.0001 |   |   |   |   |   |
|                                                                                                       | par value,18,423,309 issued and outstanding |   | 1,842 |   |   | 1,842 |
|                                                                                                       | Additional paid-in capital |   | 13,961,491 |   |   | 13,961,491 |
|                                                                                                       | Accumulated deficit during development stage |   | (15,004,175) |   |   | (14,978,690) |
|                                                                                                       |   | TOTAL STOCKHOLDERS' DEFICIT |   | (1,040,842) |   |   | (1,015,357) |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| **TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT**                                                            | $ | 40,587 |   | $ | 51,686 |

The accompanying condensed notes are an integral part of these interim consolidated financial statements.

4

Return to Table of Contents

----

| **SOLAR ENERGY LIMITED                    (A Development Stage Company)                    INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS** |
|--------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   | From Inception |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   | (January 5, |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   | 1994) |
|                                                                                                                                       |   |   |   |   |   |   | Three Months Ended |   | through |
|                                                                                                                                       |   |   |   |   |   |   | March 31, |   | March 31, |   | March 31, |
|                                                                                                                                       |   |   |   |   |   |   | 2009 |   | 2008 |   | 2009 |
|                                                                                                                                       |   |   |   |   |   |   | (Unaudited) |   | (Unaudited) |   | (Unaudited) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| REVENUES                                                                                                                                   |   |   | $ | - | $ | - | $ | - |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| EXPENSES                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                                                                                       | General and administrative |   |   | 14,519 |   | 176,745 |   | 6,235,427 |
|                                                                                                                                       | Research and development |   |   | - |   | - |   | 2,671,638 |
|                                                                                                                                       | Impairment of patents |   |   | - |   | 2,012 |   | 39,648 |
|                                                                                                                                       | Impairment of goodwill |   |   | - |   | - |   | 14,118 |
|                                                                                                                                       |   | TOTAL EXPENSES |   |   | 14,519 |   | 178,757 |   | 8,960,831 |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| LOSS FROM OPERATIONS                                                                                                                       |   |   | (14,519) |   | (178,757) |   | (8,960,831) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| OTHER INCOME (EXPENSES)                                                                                                                    |   |   |   |   |   |   |   |
|                                                                                                                                       | Other income |   |   | - |   | 22,600 |   | 349,886 |
|                                                                                                                                       | Financing costs |   |   | - |   | - |   | (1,477,800) |
|                                                                                                                                       | Gain (loss) on investments |   |   | - |   | - |   | 17,200 |
|                                                                                                                                       | Gain (loss) on sale or disposal of assets |   |   | - |   | - |   | (10,867) |
|                                                                                                                                       | Gain (loss) on derivative instrument |   |   | - |   | - |   | 29,551 |
|                                                                                                                                       | Gain on forgiveness of debt |   |   | - |   | - |   | 172,227 |
|                                                                                                                                       | Interest income (expense), net |   |   | (10,966) |   | - |   | (123,748) |
|                                                                                                                                       | Amortization of discount on debenture payable |   |   | - |   | (19,545) |   | (29,551) |
|                                                                                                                                       | Gain (loss) on sale of subsidiary |   |   | - |   | - |   | 120,711 |
|                                                                                                                                       |   | TOTAL OTHER INCOME (EXPENSE) |   |   | (10,966) |   | 3,055 |   | (952,391) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| LOSS FROM CONTINUING OPERATIONS                                                                                                            |   |   | (25,485) |   | (175,702) |   | (9,913,222) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| DISCONTINUED OPERATIONS                                                                                                                    |   |   |   |   |   |   |   |
|                                                                                                                                       | Gain (Loss) on discontinued operations |   |   | - |   | (118,879) |   | (5,090,953) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| NET INCOME (LOSS)                                                                                                                          |   | $ | (25,485) | $ | (294,581) | $ | (15,004,175) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       | NET INCOME (LOSS) PER COMMON SHARE, |   |   |   |   |   |
|                                                                                                                                       |   | CONTINUING OPERATIONS, BASIC AND

DILUTED $ | (0.00) | $ | (0.01) |   |   |
|                                                                                                                                       | NET INCOME (LOSS) PER COMMON SHARE, DIS- |   |   |   |   |
|                                                                                                                                       |   | CONTINUED OPERATIONS, BASIC AND DILUTED $ | 0.00 | $ | (0.01) |   |   |
|                                                                                                                                       | WEIGHTED AVERAGE NUMBER OF COMMON |   |   |   |   |   |   |   |
|                                                                                                                                       |   | SHARES OUTSTANDING, BASIC AND DILUTED | 18,423,309 |   | 21,923,309 |   |   |

The accompanying condensed notes are an integral part of these interim consolidated financial statements.

5

Return to Table of Contents

----

| **SOLAR ENERGY LIMITED                    (A Development Stage Company)                    INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS** |
|--------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   | From Inception |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   | (January 5, |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   | 1994) |
|                                                                                                                                       |   |   |   |   | Three Months Ended |   |   | through |
|                                                                                                                                       |   |   |   |   | March 31, |   |   | March 31, |   |   | March 31, |
|                                                                                                                                       |   |   |   |   | 2009 |   |   | 2008 |   |   | 2009 |
|                                                                                                                                       |   |   |   |   | (Unaudited) |   |   | (Unaudited) |   |   | (Unaudited) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| **CASH FLOWS FROM OPERATING ACTIVITIES:**                                                                                                  |   |   |   |   |   |   |   |   |
|                                                                                                                                       | Net loss | $ | (25,485) |   | $ | (175,702) |   | $ | (9,913,222) |
|                                                                                                                                       | Adjustments to reconcile net loss to net cash used in                    operating activities: |   |  |   |   |   |   |   |   |
|                                                                                                                                       | (Net of Acquisition/Sale) |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   | Amortization and depreciation |   | - |   |   | - |   |   | 212,809 |
|                                                                                                                                       |   | Amortization on discount of debentures |   | - |   |   | 18,739 |   |   | 29,551 |
|                                                                                                                                       |   | Bad debt |   | - |   |   | - |   |   | 250,000 |
|                                                                                                                                       |   | Stock issued for services |   | - |   |   | - |   |   | 856,851 |
|                                                                                                                                       |   | Services for pre-paid expense |   | - |   |   | - |   |   | 169,165 |
|                                                                                                                                       |   | (Gain) Loss on derivative |   | - |   |   | - |   |   | (29,551) |
|                                                                                                                                       |   | Stock issued for R&D expenses |   | - |   |   | - |   |   | 439,900 |
|                                                                                                                                       |   | Loss on sale of assets |   | - |   |   | - |   |   | 10,867 |
|                                                                                                                                       |   | Gain on investments |   | - |   |   | - |   |   | (17,199) |
|                                                                                                                                       |   | Loss on sale of subsidiary |   | - |   |   | - |   |   | (120,711) |
|                                                                                                                                       |   | Gain on forgiveness of debt |   | - |   |   | - |   |   | (172,227) |
|                                                                                                                                       |   | Impairment of patents |   | - |   |   | - |   |   | 39,648 |
|                                                                                                                                       |   | Financing costs |   | - |   |   | - |   |   | 1,477,800 |
|                                                                                                                                       |   | Impairment of goodwill |   | - |   |   | - |   |   | 14,118 |
|                                                                                                                                       |   | Minority interest |   | - |   |   | - |   |   | (123,856) |
|                                                                                                                                       |   | (Increase) decrease in: |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   | Other receivable |   | - |   |   | - |   |   | (37,794) |
|                                                                                                                                       |   |   | Deposits |   | - |   |   | - |   |   | (24,883) |
|                                                                                                                                       |   |   | Prepaid expenses |   | - |   |   | (1,496) |   |   | 22,500 |
|                                                                                                                                       |   | Increase (decrease) in: |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   | Accounts payable and bank overdraft |   | 3,421 |   |   | (118,620) |   |   | 331,995 |
|                                                                                                                                       |   |   | Accrued expenses and other current liabilities |   | 10,965 |   |   | 222 |   |   | 282,842 |
|                                                                                                                                       |   |   | Deferred revenues |   | - |   |   | - |   |   | 250,000 |
|                                                                                                                                       |   |   | Minority interest |   | - |   |   | - |   |   | 66,120 |
|                                                                                                                                       |   | Net cash used by continuing operating activities |   | (11,099) |   |   | (276,857) |   |   | (5,985,277) |
|                                                                                                                                       |   | Net cash provided (used) by discontinued operating                    activities |   | - |   |   | (331,318) |   |   | (3,025,696) |
|                                                                                                                                       |   | Net cash provided (used) by operating activities |   | (11,099) |   |   | (608,175) |   |   | (9,010,973) |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
| *Continued**on following**page.*                                                                                                           |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |

6

Return to Table of Contents

----

| *Continued from previous page.*                  |                                                                             |                                      |     |   |    |      |      |   |
|--------------------------------------------------|----------------------------------------------------------------------------------|-------------------------------------------|----------|--------|---------|-----------|-----------|--------|
| **CASH FLOWS PROVIDED BY INVESTING ACTIVITIES:** |                                                                             |                                      |     |   |    |      |
|                                             | Cash acquired from sale of subsidiary                                            |                                      | -        |   |    | -         |      |   | 180,000 |
|                                             | Cash acquired from subsidiary                                                    |                                      | -        |   |    | -         |      |   | 3,221,116 |
|                                             | Cash paid to subsidiary                                                          |                                      | -        |   |    | -         |      |   | (107,568) |
|                                             | Cash paid to Renewable Energy Corporation and                    Sunspring, Inc. |                                      | -        |   |    | -         |      |   | (2,076) |
|                                             | Cash paid for patent costs                                                       |                                      | -        |   |    | -         |      |   | (106,318) |
|                                             | Cash paid for property & equipment                                           |                                      | -        |   |    | -         |      |   | (868,572) |
|                                             | Cash paid for deposits                                                           |                                      | -        |   |    | -         |      |   | (4,837) |
|                                             | Cash received on sale of assets                                                  |                                      | -        |   |    | -         |      |   | 23,000 |
|                                             | Cash paid for notes receivable                                                   |                                      | -        |   |    | -         |      |   | (295,000) |
|                                             | Discontinued operations                                                          |                                      | -        |   |    | 1,000,000 |      |   | 1,000,749 |
|                                             |                                                                             | Net cash provided by investing activities |     | -      |    |      | 1,000,000 |   |   | 3,040,494 |
|                                             |                                                                             |                                      |     |   |    |      |      |   |   |   |   |
|                                             |                                                                             |                                      |     |   |    |      |      |   |   |   |   |
| **CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:** |                                                                             |                                      |     |   |    |      |
|                                             | Issued stock for cash                                                            |                                      | -        |   |    | -         |      |   | 3,917,469 |
|                                             | Cash received from related party notes payable and                    advances   |                                      | -        |   |    | -         |      |   | 1,690,343 |
|                                             | Cash repaid to related party notes payable and                    advances       |                                      | -        |   |    | (184,138) |      |   | (290,500) |
|                                             | Proceeds from debenture payable                                                  |                                      | -        |   |    | -         |      |   | 100,000 |
|                                             | Cash received from advances by shareholders                                      |                                      | -        |   |    | -         |      |   | 2,044,099 |
|                                             | Cash paid on debt financing                                                      |                                      | -        |   |    | -         |      |   | (1,388,178) |
|                                             | Discontinued operations                                                          |                                      | -        |   |    | -         |      |   | (100,000) |
|                                             | Net cash provided by financing activities                                        |                                      | -        |   |    | (184,138) |      |   | 5,973,233 |
|                                             |                                                                             |                                      |     |   |    |      |      |   |   |   |   |
|                                             | **NET INCREASE (DECREASE) IN CASH**                                              |                                      | (11,099) |   |    | 207,687   |      |   | 2,754 |
|                                             |                                                                             |                                      |     |   |    |      |      |   |   |   |   |
| **CASH, BEGINNING OF PERIOD**                    |                                                                             | 13,853                                    |     |   | 67,355  |      |      | -      |
|                                             |                                                                             |                                      |     |   |    |      |      |   |   |   |   |
| **CASH, END OF PERIOD**                          | $                                                                                | 2,754                                     |     | $      | 275,042 |      | $         | 2,754  |
|                                             |                                                                             |                                      |     |   |    |      |      |   |   |   |   |
| **SUPPLEMENTAL CASH FLOW INFORMATION:**          |                                                                             |                                      |     |   |    |      |      |   |
|                                             | Interest paid                                                                    | $                                         | -        |   | $       | -         |      | $      | 17,195 |
|                                             | Income taxes paid                                                                | $                                         | -        |   | $       | -         |      | $      | - |

The accompanyingcondensednotes are an integral part of theseconsolidatedfinancial statements.

7

Return to Table of Contents

----

**Solar Energy Limited**

**(A Development Stage Company)**

**Condensed****Notes to the Consolidated Financial Statements**

**March 31****, 200****9**

**NOTE 1 – DESCRIPTION AND HISTORY OF BUSINESS AND BASIS OF PRESENTATION**

Solar Energy Limited (the “Company”) is in the development stage according to Financial Accounting Standards Board Statement No. 7 and is currently focusing its attention on raising capital in order to pursue its goals.

The Company was originally incorporated as Taurus Enterprises, Inc. under the laws the State of Delaware on January 5, 1994. In August of 1996, the Company merged with Salvage World, Inc., a private company, changed its name to “Salvage World, Inc.” and reincorporated in        the state of Nevada. On December 17, 1997, the Company merged with Solar Energy Limiteda Delaware corporation organized on July 24, 1997, and changed the name to “Solar Energy Limited.” The surviving corporation is a Delaware corporation and the authorized shares were changed to 50,000,000 par value $0.0001.          

These unaudited interim financial statements have been prepared in accordance with United States generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q of Regulation S-K. They may not include all information and footnotes required by United States generally accepted accounting        principles for complete financial statements. However, except as disclosed herein, there has been no material changes in the information disclosed in the notes to the financial statements for the year ended December 31, 2008 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. The interim unaudited financial statements should be read in conjunction with those financial statements included in the Form 10-K. In the opinion of        management, all adjustments considered necessary for a fair presentation, consisting solely of normal and recurring adjustments have been made. Operating results for the three months ended March 31, 2009 are not necessarily indicative of the results that may be expected for the year ending December 31, 2009.

**NOTE 2 – Summary of Significant Accounting Policies**

This summary of significant accounting policies of Solar Energy Limited is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to        accounting principles generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements.          

Accounting Method

The Company’s financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid investments and short-term debt instruments with original maturities of three months or less to be cash equivalents.           

 

8

Return to Table of Contents

----

**Solar Energy Limited**

**(A Development Stage Company)**

**Condensed****Notes to the Consolidated Financial Statements**

**March 31****, 200****9**

**NOTE 2 – Summary of Significant Accounting Policies****- Continued**

Derivative Instruments

The Financial Accounting Standards Board issued Statement of Financial Accounting Standards (“SFAS”) No. 133, “Accounting for Derivative Instruments and Hedging Activities,” as amended by SFAS No. 137, “Accounting for Derivative Instruments and Hedging Activities –        Deferral of the Effective Date of FASB No. 133”, SFAS No. 138, “Accounting for Certain Derivative Instruments and Certain Hedging Activities”, and SFAS No. 149, “Amendment of Statement 133 on Derivative Instruments and Hedging Activities”, which is effective for the Company as of its inception. These statements establish accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and        for hedging activities. They require that an entity recognize all derivatives as either assets or liabilities in the balance sheet and measure those instruments at fair value.

If certain conditions are met, a derivative may be specifically designated as a hedge, the objective of which is to match the timing of gain or loss recognition on the hedging derivative with the recognition of (i) the changes in the fair value of the hedged asset or liability that are attributable to the        hedged risk or (ii) the earnings effect of the hedged forecasted transaction. For a derivative not designated as a hedging instrument, the gain or loss is recognized in income in the period of change. Historically, the Company has not entered into derivatives contracts to hedge existing risks or for speculative purposes.

The Company issued convertible debt and accounts for that debt according to SFAS 133 and subsequent pronouncements. Consequently, management recognizes its convertible debt contract as containing a derivative instrument and accounts for the derivative according to generally accepted accounting principles in        the U.S.

During the year ended December 31, 2006, the Company issued a debenture for a total of $100,000. The debenture included provisions for the conversion of the debt and interest into shares of the Company’s common stock or into CO2 Tonnesto be generated by Planktos, Inc. SincePlanktos, Inc. has discontinued operations, the conversion into CO2 Tonnes is no longer available and the debenture is accounted for as a promissory note with fixed interest. See Note 7.          

Development Stage Activities

The Company has been in the development stage since inception. The Company has no revenues from its planned operations. The Company is in the development stage according to Financial Accounting Standards Board Statement No. 7 and is currently focusing its attention on raising capital in order to pursue its goals.

Earnings (Loss) Per Share 

The Company adopted Statement of Financial Accounting Standards No. 128, which provides for calculation of "basic" and "diluted" earnings per share. Basic earnings (loss) per share includes no dilution and is computed by dividing net income (loss) available to common shareholders by the weighted        average common shares outstanding for the period. Diluted earnings (loss) per share reflect the potential dilution of securities that could share in the earnings of an entity similar to fully diluted earnings per share. For the fiscal year 2008, diluted net loss per share was the same as basic net loss per share as the common stock equivalents outstanding were considered anti-dilutive. For the fiscal year 2008, the Company had a net loss from continuing operations and net income from        discontinued operations, therefore earnings per share on a fully diluted basis to include common stock equivalents is disclosed.

9

Return to Table of Contents

----

**Solar Energy Limited**

**(A Development Stage Company)**

**Condensed****Notes to the Consolidated Financial Statements**

**March 31****, 200****9**

**NOTE 2 – Summary of Significant Accounting Policies****- Continued**

Earnings (Loss) Per Share- Continued

As of March 31, 2009, the Company had outstanding common stock options of 500,000 and common stock warrants of 1,250,000. The above common stock equivalents were deemed to be antidilutive for the Company during the three months ended March 31, 2009.                   As of December 31, 2008, the Company had outstanding common stock options of 500,000 and common stock warrants of 1,250,000. The above common stock equivalents were deemed to be antidilutive for the Company’s year end of December 31, 2008. 

Fair Value Measurements

The Company's financial instruments as defined by Statement of Financial Accounting Standards No. 107, "Disclosures about Fair Value of Financial Instruments," include cash, trade accounts receivable, accounts payable and related party payables. All instruments are accounted for on a historical cost basis, which, due to the short maturity of these financial        instruments, approximates fair value at March 31, 2009 and December 31, 2008.                  Effective January 1, 2008, the Company adopted Financial Accounting Standards Board (FASB) SFAS No.157, *Fair Value Measurements*(SFAS 157). The provisions of SFAS 157 are applicable to all of the Company’s assets and liabilities that are measured and recorded at fair value. SFAS 157 defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a        liability in the principal or most advantageous market in an orderly transaction between market participants. SFAS 157 establishes a fair value hierarchy that gives the highest priority to observable inputs and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy defined by SFAS 157 are described below.          

Level 1:     Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. The Company has no Level 1 assets or liabilities; and

Level 2:     Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. The Company has no Level 2 assets or liabilities; and

Level 3:     Pricing inputs that are generally unobservable inputs and not corroborated by market data which require the reporting entity to develop its own assumptions. The Company has no Level 3 assets or liabilities.

Going Concern 

As of March 31, 2009, the Company had negative working capital of $1,040,842 and an accumulated deficit of $15,004,175. The Company is currently seeking out a new business opportunity that might, if successful, mitigate those factors which raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not        include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

10

Return to Table of Contents

----

**Solar Energy Limited**

**(A Development Stage Company)**

**Condensed****Notes to the Consolidated Financial Statements**

**March 31****, 200****9**

**NOTE 2 – Summary of Significant Accounting Policies****- Continued**

Principles of Consolidation

The March 31, 2009 financial statements include the accounts of Solar Energy Limited and its wholly owned subsidiaries: Hydro; Sunspring; REEL; and D2 Fusion, Inc. All intercompany accounts and transactions have been eliminated in the consolidation.

On November 13, 2008, the Company sold its 45,000,000 restricted shares of Planktos Corp. to Maidon Services Limited for $200,000 of which $125,000 in cash was received on closing and $75,000 was due within fourteen months with an option to convert into Planktos Corp. shares at $0.25 per share. These financial statements include the losses        from January 1, 2008 to November 12, 2008 of Planktos Corp. and its wholly owned subsidiary, Planktos Inc.

Provision for Taxes 

Effective November 1, 2007, the Company adopted the Financial Accounting Standards Board (“FASB”) Interpretation No. 48, *Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109*(“FIN 48”).        FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB Statement No. 109, *Accounting for Income Taxes*. FIN 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Additionally, FIN 48        provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The adoption of FIN 48 did not have a material impact on the Company’s financial position, results of operation or liquidity.                    Income taxes are provided based upon the liability method of accounting pursuant to Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes.” Under this approach, deferred income taxes are recorded to reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end. A valuation allowance is recorded against deferred tax assets if management does not        believe the Company has met the “more likely than not” standard imposed by SFAS No. 109 to allow recognition of such an asset.

Revenue Recognition 

The Company recognizes revenue for product sales when there is a mutually executed sales contract, when the products are shipped and title passes to customers, when the contract price and terms are fixed, and when collectibility is reasonably assured.

 

Use of Estimates

The process of preparing financial statements in conformity with accounting principles generally accepted in the United States of America requires the use of estimates and assumptions regarding certain types of assets, liabilities, revenues, and expenses. Such estimates primarily relate to unsettled transactions and events as of the date of        the financial statements. Accordingly, upon settlement, actual results may differ from estimated amounts.

11

Return to Table of Contents

----

**Solar Energy Limited**

**(A Development Stage Company)**

**Condensed****Notes to the Consolidated Financial Statements**

**March 31****, 200****9**

**NOTE 3 – GOING CONCERN**

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the financial statements, the Company has limited cash, no revenues, and an accumulated deficit since the inception of $15,004,175. These factors indicate that the Company may be unable to continue in existence. The        Company is currently putting business plans in place which will, if successful, mitigate these factors which raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans includes the following: (1) obtaining funding from private placement sources; (2) obtaining additional funding from the sale of the Company’s securities; (3) establishing revenues from commercializing its project; and (4) obtaining loans and grants from various        financial institutions, where possible. The financial statements do not include any adjustments related to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue existence.

**NOTE 4 – Stockholders’ Equity Transactions**

There were no transactions for the three months ended March 31, 2009.

**NOTE 5 – Notes Payable - Related Party**

The loan from Regal RV Resorts, Inc., a shareholder, as of December 31, 2008 was $376,521 of which $175,000 is uncollateralized and bears no interest while $201,521 of the loan is uncollateralized and bears 6% per annum and is due upon demand. The accrued interest owing on this loan        at March 31, 2009 and December 31, 2008 was $30,719 and $27,738, respectively. 

 

**NOTE 6 – Debenture Payable**

This loan bears interest at 10% per year for a three year term. Principal and interest may be converted into common shares of the Company at an average trading price of the previous 10 days once the holder has given the Company notice of conversion. Upon such notice, the maximum conversion price is $0.75 per common share. The holder of the        debenture also had the right, at its option, to convert the principal and interest amount due into CO2 tonsat any time prior to the end of the three year term, at a rate of one United States Dollar ($1.00) per CO2 ton, subject to Company’s ability to deliver such CO2 tons at the time of conversion. During 2008, Planktos Inc. discontinued operations thus eliminating the conversion option into CO2 tons and the market price of the Company’s        common stock at year end was below the conversion price of $0.75. 

The original $100,000 debenture was discounted by $29,551 in order to reflect the derivative portion of the note. During 2008, this discount was amortized by $18,739 to the full discounted derivative portion of $29,551 when Planktos Inc. discontinued operations. As of March 31, 2009, the Company owed $100,000 in principal and accrued interest        of $29,184. 

 

 

12

Return to Table of Contents

----

**Solar Energy Limited**

**(A Development Stage Company)**

**Condensed****Notes to the Consolidated Financial Statements**

**March 31****, 200****9**

**NOTE 7 – STOCK OPTIONS AND WARRANTS**

The Company did not issue any new stock options or share purchase warrants during the three months ended March 31, 2009.

**NOTE 8 – DISCONTINUED OPERATIONS**

In December 2007, the Company’s former minority owned subsidiary Planktos Corp.’s wholly owned subsidiary, Planktos Inc., suspended its Iron-Fertilization Prove-Out operations,and initiated negotiations for the sale ofthe        related assets.  Accordingly, this business component has been presented as discontinued operations within the consolidated financial statements in accordance with SFAS No. 144, “ Accounting for the Impairment or Disposal of Long-Lived Assets” and EITF 03-13. 

13

Return to Table of Contents

----

**Item 2****.     ****MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND        RESULTS OF OPERATIONS**

This *Management’s Discussion and Analysis of Financial Condition and**Results of Operations*and other parts of this quarterly reportcontain forward-looking statements that involve        risks and uncertainties.Forward-looking statements canbe identified by words such as “anticipates,”“expects,”“believes,”“plans,”“predicts,”and similar terms.        Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include but are not limited to those discussed in the subsection entitled *Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition*below. The following        discussion should be read in conjunction with our financial statements and notes thereto included in this report. Our fiscal year end is December 31. All information presented herein is based on the threemonthperiodsended March 31, 2009. 

**Discussion and Analysis**

The Company’s plan of operation for the coming year is to actively pursue development stage assets and emerging businesses with which to merge or acquire. We intend to function as a business incubator for assets and businesses that focus on (i) cost-effective renewable energy sources that do not threaten the environment, and (ii) practical        solutions to mitigate the effects of traditional energy sources’ unintended consequences concerning global climate change. We will fund the process of driving emerging technologies towards commercial applications through debt or equity offerings tied to our common stock. 

We have not yet entered into any agreement, nor do we have any commitment or understanding to enter into or become engaged in any transaction, as of the date of this filing.          

The Company’s plan of operation over the next twelve months will require a minimum of $100,000 to identify a suitable business opportunity for development through merger or acquisition. Should the Company decide to develop a business opportunity through merger or acquisition, our funding requirements        will change. We will also require up to $1,000,000 to satisfy current amounts payable. Financing to meet these cash requirements is not currently available.

**Results of Operations**

During the three month periodended March 31, 2009, the Company was focused on (i) pursuingfinancing commitments for its plan of operation, (ii)        continuing thesearch for a business opportunity to develop through merger or acquisition,and (iii) satisfying continuous public disclosure requirements. 

The Company hasnot generated any revenues from inception and has discontinuedoperations.Since wehavenocurrent ability to        generate revenue, we expectto incur losses for the foreseeable future.

 

***Net Losses*** 

For the period from January 5, 1994 (inception) to March 31, 2009the Company recorded a net loss of $15,004,175. Net losses for thethree monthsended March 31, 2009were $25,485as compared to $294,581for the three monthsendedMarch 31, 2008.The decrease in net losses over the comparative three month periods can be attributed to the fall ingeneral and administrative expensesas the result of our        discontinuation of operations related to “iron fertilization” and “cold fusion”. We expect to continue to incur net losses over the next twelve months aswe seek out another business opportunity fordevelopment through merger or acquisition.

14

Return to Table of Contents

----

***Capital Expenditures*** 

During 2007PlanktosCorp., formerly amajority owned subsidiaryof the Company,purchased a research vessel for $800,000 which vessel was sold during 2008 for $1,000,000.Otherwise, the Company has expended no significant amount on capital expendituresfor the period from inception toMarch 31, 2009. 

***Income Tax Expense (Benefit)***

TheCompanymay have a prospective income tax benefit resulting from a net operating loss carryforward and start up costs that could offset future operating profits.

***Impact of Inflation***

TheCompanybelieves that inflation has had a negligible effect on operations over the past three years. 

***Liquidity and Capital Resources*** 

The Company is in the development stage and, since inception, has experienced significant changes in liquidity, capital resources and stockholders’ equity.We have been funded since inception from public or private debt or equity placements or by major shareholders in the form of loans.All of our projects have been experimental in nature and virtually all of the financingraised to date has been either allocated foror related to general and administrative or research and the development activities.

The Company had a working capital deficit of $1,040,842as of March 31, 2009, upfrom$1,015,357 as of December 31, 2008. As of March 31, 2009our current and total assets were $40,587,        consistingof cashin the amount of $2,754 and a receivable related to the sale of our interest in Planktos Corp.Our current liabilities totaled $1,081,429, which included a note payable to a related party of $376,521, advances payable of $444,650, and accounts payable with accrued expenses of $100,355. Net stockholders' deficit in the Company was$1,040,842as of March 31, 2009, up from$1,015,357 at December 31, 2008. 

Cash flow used in operating activities was $9,010,973for the period from inception toMarch 31, 2009. Cash flow used in operating activities for the threemonthsended March 31, 2009was $11,099as compared to $608,175for the threemonths ended March 31, 2008. The decreasein cash flow used in operating activities in the current periodwas due primarily to the decrease in cash flow used in operating activities and the decrease in cash flow used by        discontinued operating activities over the comparative periods. 

Cash flowprovided byinvesting activities was $3,040,494for the period from inception to March 31, 2009. Cash flow provided by investing activities for thethreemonths ended        March 31, 2009was $0as compared to cash flow provided by investing activities of $1,000,000for thethreemonths ended March 31, 2008. Cash flows providedby investing activities in the priorperiod can be attributed to the sale        of the research vessel formerly owned by Planktos Corp. 

Cash flow provided by financing activities was $5,973,233for the period from inception to March 31, 2009. Cash used infinancing activities for the threemonths ended March 31, 2009was $0as compared tocash used infinancing activities of$184,138for thethreemonths ended March 31, 2008. Cash flow used infinancing activities in the priorperiod        can be attributed to the repayment of related party loans andadvances.

         

15

Return to Table of Contents

----

The Company’s current assetsare insufficient to conduct itsplan of operation over the next twelvemonths and we will have to seek additional debt or equity financing to fund operations. The Company has no current commitments or arrangements with        respect to, or immediate sources of funding. Further, no assurances can begiven that funding isavailable or available to the Company on acceptable terms. The Company’s shareholders would be the most likely source of new funding in the form of loans or equity placements though none have made any commitment for future investment and we have no agreement formal or otherwise. The Company’s inability to        obtain funding has had a material adverse affect on our plan of operation and will continue to diminish our ongoing businesses.         

The Company does not expect to pay cash dividends in the foreseeable future.         The Companyhad no lines of credit or other bank financing arrangements.          The Companyhas no defined benefit plan or contractual commitment with any of its officers or directors. 

The Companyhas no current plans for the purchase or sale of any plant or equipment. 

The Company currently has no employees and has no plans to hire any employees in the near future.

***Off Balance Sheet Arrangements***

As of March 31, 2009, we have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that arematerial to        stockholders.

***Critical Accounting Policies***

In the notes to the audited consolidated financial statements for the year ended December 31, 2008included in the Company’s Form 10-K, the Company discussed those accounting policies that are considered to be significant in determining the results of operations and our financial position. We believe that the accounting        principles utilized by us conform to accounting principles generally accepted in the United States of America.

The preparation of financial statements requires management to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. By their nature, these judgments are subject to an inherent degree of uncertainty. On an on-going basis, we evaluate our estimates, including those related to bad debts,        inventories, intangible assets, warranty obligations, product liability, revenue, and income taxes. We base our estimates on historical experience and other facts and circumstances that are believed to be reasonable, and the results form the basis for making judgments about the carrying value of assets and liabilities. The actual results may differ from these estimates under different assumptions or conditions.

16

Return to Table of Contents

----

***Going Concern***

The Company’s audit expressed substantial doubt as to the Company’s ability to continue as a going concern as a result of recurring losses, lack of revenue-generating activities and an accumulated deficit of $14,978,690 as of December 31, 2008. Our accumulated deficit increased to $15,004,175as        of March 31, 2009. The Company’s ability to continue as a going concern is subject to our ability to obtain funding from outside sources. Management’s plan to address our ability to continue as a going concern, include: (i) obtaining funding from private placement sources; (ii) obtaining additional funding from the sale of our securities; (iii) generating revenues from the development of a business opportunity through acquisition or merger; and (iv) obtaining loans and        grants from various financial institutions, where possible. Although management believes that it will be able to obtain the necessary funding to allow us to remain a going concern through the methods discussed above, there can be no assurances that such methods will prove successful.

***Forward Looking Statements and Factors That May Affect Future Results and Financial Condition***

The statements contained in the section titled *Management’s Discussion and Analysis of Financial Condition and**Results of Operations*,with the exception of historical facts, are        forward looking statements. A safe-harbor provision may not be applicable to the forward looking statements made in this current report Forward looking statements reflect our current expectations and beliefs regarding our future results of operations, performance, and achievements. These statements are subject to risks and uncertainties and are based upon assumptions and beliefs that may or may not materialize. These statements include, but are not limited to, statements concerning:        

|  | ·      | the sufficiency of existing capital resources; |
|--|----------------------------------------|------------------------------------------------|

|  | ·      | our anticipated financial performance; |
|--|----------------------------------------|----------------------------------------|

  ·      our ability to raise additional capital to fund cash requirements for future operations;

 

|  | ·      | uncertainties related to the development of our technologies; |
|--|----------------------------------------|---------------------------------------------------------------|

|  | ·      | the volatility of the stock market; and |
|--|----------------------------------------|-----------------------------------------|

  ·      general economic conditions.

We wish to caution readers that our operating results are subject to various risks and uncertainties that could cause our actual results to differ materially fromthose discussed or anticipatedincluding the factors set forth in the section entitled        *Risk Factors*included elsewhere in this report. We also wish to advise readers not to place any undue reliance on the forward looking statements contained in this report, which reflect our beliefs and expectations only as of the date of this report. We assume no obligation to update or revise these forward looking statements to reflect new events or circumstances or any changes in our beliefs or        expectations, other thanis required by law.

***Stock-Based Compensation***

We have adopted Financial Accounting Standards Board(“FASB”)No. 123 (revised 2004) (Statements of Financial Accounting Standards (“SFAS”) No. 123R), Share-Based Payment, which addresses the accounting for stock-based payment transactions in which an enterprise receives employee services in exchange for (a) equity instruments of the enterprise or (b) liabilities that are based on the fair value of the enterprise’s equity instruments or that may be        settled by the issuance of such equity instruments. 

17

Return to Table of Contents

----

**We account for equity instruments issued in exchange for the receipt of goods or services from other than employees in accordance with SFAS No. 123 and the conclusions reached by the Emerging Issues Task Force (“EITF”) in Issue No. 96-18. Costs are measured at the estimated        fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services as defined by EITF 96-18.**

***Recent Accounting Pronouncements***

In November 2008, the FASB issued EITFNo. 08-7, *Accounting for Defensive Intangible Assets*(“EITF 08-7”). EITF 08-07 applies to all acquired intangible assets in which the acquirer does not intend to actively use the assets but        intends to hold (lock up) the asset to prevent its competitors from obtaining access to the asset (a defensive asset), assets that the acquirer will never actually use, as well as assets that will be used by the acquirer during a transmission period when the intention of the acquirer is to discontinue the use of those assets. EITF 08-7 is effective as of January 1, 2009. The Companydoes not expect the adoption of EITF 08-7 to have a material impact        on its consolidated financial statements.

InJune 2008, the FASB issued Staff Position EITF 03-6-1, *Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities,*(“FSP EITF 03-6-1”). FSP EITF 03-6-1 addresses whether instruments        granted in share-based payment transactions are participating securities prior to vesting, and therefore need to be included in the computation of earnings per share under the two-class method as described in FASB SFASNo. 128, “Earnings per Share.” FSP EITF 03-6-1 is effective for financial statements issued for fiscal years beginning on or after December 15, 2008 and earlier adoption is prohibited. We are not required to adopt        FSP EITF 03-6-1; neither do we believe that FSP EITF 03-6-1 would have material effect on our consolidated financial positionand results of operations if adopted.

In May, 2008, the FASB issued SFASNo. 163, *Accounting for Financial Guarantee Insurance Contracts—an interpre**tation of FASB Statement No. 60*(“SFAS 163”). SFAS        163requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. SFAS 163 also clarifies how SFAS60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities. Those        clarifications will increase comparability in financial reporting of financial guarantee insurance contracts by insurance enterprises. SFAS 163requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of SFAS 163will improve the quality of information provided to users of financial statements. SFAS 163is effective        for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years, except for some disclosures about the insurance enterprise’s risk-management activities. SFAS 163requires that disclosures about the risk-management activities of the insurance enterprise be effective for the first period (including interim periods) beginning after issuance of SFAS 163. Except for those        disclosures, earlier application is not permitted.  The adoption of this statement will have no material effect on the Company’s financial condition or results of operations.           

In May, 2008, the FASB issued SFASNo. 162, *The**Hierarchy**of Generally Accepted Accounting Principles*(“SFAS No. 162”). SFAS        162identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles (GAAP) in the United States (the GAAP hierarchy). The sources of accounting principles that are generally accepted are categorized in descending order of authority as follows:

18

Return to Table of Contents

----

a.      FASB Statements of Financial Accounting Standards and Interpretations, FASB Statement 133 Implementation Issues, FASB Staff Positions, and American Institute of Certified Public Accountants (AICPA) Accounting Research Bulletins and Accounting Principles Board Opinions that are not superseded by actions of the        FASB

b.      FASB Technical Bulletins and, if cleared by the FASB, AICPA Industry Audit and Accounting Guides and Statements of Position 

c.     AICPA Accounting Standards Executive Committee Practice Bulletins that have been cleared by the FASB, consensus positions of the FASB Emerging Issues Task Force (EITF), and the Topics discussed in Appendix D of *EITF Abstracts* (EITF D-Topics)

d.      Implementation guides (Q&As) published by the FASB staff, AICPA Accounting Interpretations, AICPA Industry Audit and Accounting Guides and Statements of Position not cleared by the FASB, and practices that are widely recognized and prevalent either generally or in the industry. 

The adoption of SFAS 162will have no material effect on the Company’s financial condition or results of operations. 

In March 2008, the FSAB issued SFASNo. 161, “Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133” (SFAS No. 161). SFAS 161changes the disclosure requirements for derivative instruments and hedging        activities. Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under SFAS133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS 161is intended to        enhance the current disclosure frameworkin Statement 133. SFAS 161requires that objectives for using derivative instruments be disclosed in terms of underlying risk and accounting designation. This disclosure better conveys the purpose of derivative use in terms of the risks that the entity is intending to manage. Disclosing the fair values of derivative instruments and their gains and losses in a tabular format        should provide a more complete picture of the location in an entity’s financial statements of both the derivative positions existing at period end and the effect of using derivatives during the reporting period. Disclosing information about credit-risk-related contingent features should provide information on the potential effect on an entity’s liquidity from using derivatives. Finally, SFAS 161requires cross-referencing within the        footnotes, which should help users of financial statements locate important information about derivative instruments. The adoption of SFAS 161will have no material effect on the Company’s financial condition or results of operations. 

**ITEM 3.     ****QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

Not required.

19

Return to Table of Contents

----

**ITEM 4T.     ****CONTROLS AND PROCEDURES**

***Evaluation of Disclosure Controls and Procedures***

        In connection with the preparation of this report on Form 10-Q, an evaluation was carried out by the Company’s management, with the participation of the chief executive officer and the chief financial officer, of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)). Disclosure controls and procedures are designed to ensure that information        required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission’s rules and forms and that such information is accumulated and communicated to management, including the chief executive officer and the chief financial officer, to allow timely decisions regarding required disclosures.          

Based on that evaluation, the Company’s management concluded, as of the end of the period covered by this report, that the Company’s disclosure controls and procedures were effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Commission’s        rules and forms, and that such information was accumulated and communicated to management, including the chief executive officer and the chief financial officer, to allow timely decisions regarding required disclosures.

***Changes in Internal Control over Financial Reporting***

 

There have been no changes in internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during theperiodendedMarch 31, 2009, that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

**PART II****– OTHER INFORMATION**

**ITEM 1.     LEGAL PROCEEDINGS         **

Legal proceedings were initiated by Mary Ruth Ladd against the Company, PlanktosCorp.and certain individuals affiliated to the Company on October 3, 2007 in the Superior Court of the State of California, County of San Francisco in connection with allegations of discrimination and        retaliation against a whistle blower, wrongful termination, fraud, breach of contract, wrongful business acts and intentionally causing injury in the workplace. The claim seeks $58,280 in lost wages in addition to certain employee benefits and punitive damages. The Company has retained counsel to respond to these allegations and denies any liability for these alleged causes of action.

20

Return to Table of Contents

----

**ITEM 1****A****.****     RISK FACTORS         **

The Company’s operations and securities are subject to a number of risks. Below we have identified and discussed the material risks that we are likely to face. Should any of the following risks occur, they will adversely affect our operations, business, financial condition and/or operating results as well as the future trading price and/or the value of our        securities. 

**Risks Related to the Company’s Business**

***The C******ompany’s ability to continue as a going concern is in question***

The Company’s auditors included an explanatory statement in Note 2 of their report of financial statements for the years ended December 31, 2008 and 2007, stating that there are certain factors which raise substantial doubt about the Company’s ability to continue as a going concern. These factors include alack of        revenue generating activities in place and losses since inception.

***We have a history of significant operating losses and such losses may continue in the future***         Since our inception in 1994, our operations have resulted in a continuation of losses and an accumulated deficit of$15,004,175at March 31, 2009. The Company has never realized revenue from operations. We expect tocontinue to incur operating losses as we seek ways toidentify additional business opportunities while maintaining operations        and satisfying public disclosure obligations. Should we be unable to transition current losses to future profits by developing or acquiring a revenueproducing business, our ability to maintain operations will be severely compromised. 

***Our busines******s will not******be profitable in the next twelve months and may never be profitable.*** 

All of ourresearch and development operations are currently suspended and as such we have noexpectation of realizing profitable operations within the next twelve monthsor ever. Any possibility of future profit from operations is highly        speculative.

***The Company’s limited financial re******sources cast severe doubt on its******ability to******develop******or******acquire******a profitable business opportunity.*** 

The Company’s future operation is dependent upon the development or acquisition of a profitable business opportunity. However, the prospect of such development oracquisition is doubtful due to the Company’s limited financial resources. Further, due to the suspension of all research and development        activities, the Company is not in a favorable position to improve itsfinancial condition through debt or equity offerings. Ultimately, this limitation may causeus to cease operations.

***Our limited financial resources cast severe doubt on our ability to pursue our business plan of incubating new business opportunities.***

The Company’s future operation is dependent upon its ability to realize sufficient financing to incubate business opportunities through merger or acquisition. We cannot be certain that financing for our intended purpose will be forthcoming. Our inability to finance new business opportunities will prevent us from developing our business plan        and may act as a deterrent in any future negotiations with merger or acquisition candidates. Should the Company be unable to realize financing and develop what might become a profitable business opportunity, it will, in all likelihood, be forced to cease operations.

21

Return to Table of Contents

----

**Risks Related to the Company’s Stock**

***The C******ompany will need to raise additional capital to fund operations which could adversely affect our shareholders***

The Company will need to raise additional capital. However, we have no commitment from any source of financing to provide us with this necessary additional capital. Should we secure a commitment to provide us with capital such commitment may obligate us to issue additional shares of the Company’s common stock or warrants or other rights to        acquire common stock which will result in dilution to existing shareholders. Nonetheless, if we are unable to obtain additional capital, then we will need to restrict or even cease operations, which action would adversely affect our shareholders.

***The market for our stock is limited and our stock price may be volatile.***

        The market for our common stock has been limited due to low trading volume and the small number of brokerage firms acting as market makers. Because of the limitations of our market and volatility of the market price of our stock, investors may face difficulties in selling shares at attractive prices when they want to. The average daily trading volume for our stock has varied significantly from week to week and from month to month, and the trading volume often varies widely from day to        day.

 

***We incur significant expenses as a result of******the Sarbanes-Oxley Act of 2002******, which******expenses may continue to******negatively impact our        financial performance.***         We incur significant legal, accounting and other expenses as a result of the Sarbanes-Oxley Act of 2002, as well as related rules implemented by the Commission, which control the corporate governance practices of public companies. Compliance with these laws, rules and regulations, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002,as discussed in the following risk factor, hassubstantially        increased our expenses, including legal and accounting costs, and madesome activities more time-consuming and costly. Further, expenses related to our compliance may increase in the future, as legislation affecting smaller reporting companies comes into effect that may negatively impact our financial performance to the point of having a material adverse effect on our results of operations and financial condition.

***Our internal controls over financial reporting may not be considered effective******in the future******, which could result in a loss of investor confidence in our financial reports and in turn have an adverse effect on our stock        price.***

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 we arerequired to furnish a report by our management on our internal controls over financial reporting. Such report must contain, among other matters, an assessment of the effectiveness of our internal controls over financial reporting as of the end of        the year, including a statement as to whether or not our internal controls over financial reporting are effective. This assessment must include disclosure of any material weaknesses in our internal controls over financial reporting identified by management. If we are unable to continue to assert that our internal controls are effective, ourinvestors could lose confidence in the accuracy and completeness of our financial reports, which in turn could        cause our stock price to decline.

***The Company’******s shareholders may face significant restrictions on their stock.***

The Company’s stock differs from many stocks in that it is a “penny stock.” The Commission has adopted a number of rules to regulate “penny stocks” including, but not limited to, those rules from the Securities Act as follows:

22

Return to Table of Contents

----

3a51-1     which defines penny stock as, generally speaking,those securities which are not listed on either NASDAQ or a national securities exchange and are priced under $5, excluding securities of issuers that have net tangible assets greater than $2 million if they have been in operation at least        three years, greater than $5 million if in operation less than three years, or average revenue of at least $6 million for the last three years;

15g-1     which outlines transactions by broker/dealers which are exempt from 15g-2 through 15g-6 as those whose commissions from traders are lower than 5% total commissions;

15g-2      which details that brokers must disclose risks of penny stock on Schedule 15G;

15g-3      which details that broker/dealers must disclose quotes and other information relating to the penny stock market;

15g-4      which explains that compensation of broker/dealers must be disclosed;

15g-5      which explains that compensation of persons associated in connection with penny stock sales must be disclosed;

15g-6      which outlines that broker/dealers must send out monthly account statements; and

15g-9     which defines sales practice requirements. 

 

Since the Company’s securities constitute a “penny stock” within the meaning of the rules, the rules would apply to us and our securities. Because these rules provide regulatory burdens upon broker-dealers, they may affect the ability of shareholders to sell their securities in any market that may develop; the rules themselves may limit the        market for penny stocks. Additionally, the market among dealers may not be active. Investors in penny stock often are unable to sell stock back to the dealer that sold them the stock. The mark-ups or commissions charged by the broker-dealers may be greater than any profit a seller may make. Because of large dealer spreads, investors may be unable to sell the stock immediately back to the dealer at the same price the dealer sold the stock to the investor. In some cases, the stock may        fall quickly in value. Investors may be unable to reap any profit from any sale of the stock, if they can sell it at all. Shareholders should be aware that, according to Commission Release No. 34-29093 dated April 17, 1991, the market for penny stocks has suffered from patterns of fraud and abuse. These patterns include: 

|  | ·      | control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; |
|--|----------------------------------------|-------------------------------------------------------------------------------------------------------------------------|

|  | ·      | manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; |
|--|----------------------------------------|---------------------------------------------------------------------------------------------------------------------|

|  | ·      | “boiler room” practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons; |
|--|----------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------|

|  | ·      | excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and |
|--|----------------------------------------|--------------------------------------------------------------------------------------------|

|  | ·      | the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the inevitable collapse of those prices with consequent investor losses. |
|--|----------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**ITEM 2.     UNREGISTERED SALES OF EQUITY SECURITIES****AND USE OF PROCEEDS**

 

None.

**ITEM 3.     DEFAULTS ON SENIOR SECURITIES**

None.          

**ITEM 4.     ****SUBMISSION OF MATTERS****TO A VOTE OF SECURITY HOLDERS         **

None.

23

Return to Table of Contents

----

**ITEM 5.     OTHER INFORMATION         **

None.

**ITEM 6.     EXHIBITS**

Exhibitsrequired to be attached by Item 601 of Regulation S-Kare listed in the Index to Exhibits on page 26of this Form 10-Q, and are incorporated herein by this reference.

24

Return to Table of Contents

----

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.          

***Solar Energy Limited******                              Date***

/s/ Michael James Gobuty                         Date: May 20,2009

Michael James Gobuty

Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer and Director

25

Return to Table of Contents

----

**INDEX TO EXHIBITS**

***Exhibit     Description***

3(i) *      Articles of Incorporation (incorporated by reference to the Company’s Form 10-SB filed with the Securities and Exchange Commission on January 28, 1999).

3(ii) *      By-laws (incorporated herein by reference to the Company’s Form 10-SB filed with the Commission on January 28, 1999).

10(i)*     Stock Purchase Agreement dated April 27, 2004 between Renewable Energy Limited, Los Alamos Renewable Energy , LLC, Renewable Energy Corporation and the Company (incorporated by reference to the Company’s Form        10-QSB filed with the Securities and Exchange Commission on August 24, 2004).

10(ii) *     Acquisition Agreement with Planktos, Inc., dated August 10, 2005 (incorporated by reference to the Company’s Form 8-K filed with the Commission on August 19, 2005).

10(iii) *     Acquisition Agreement with D2Fusion Inc., dated August 18, 2005 (incorporated by reference to the Company’s Form 8-K filed with the Commission on August 19, 2005).

10(iv) *     Iron-Fertilization Prove-Out and Purchase Agreement with Planktos Corp. (formerly Diatom Corporation), dated August 18, 2005 (incorporated by reference to the Company's Form 8-K filed with the Commission on August 19, 2005).

10(v) *     Consulting Agreement with Bay Cove Capital Corp. dated December 1, 2005 (incorporated by reference to the Company's Form 10-QSB filed with the Commission on August 12, 2007).

10(vi) *     Securities Exchange Agreement and Plan of Exchange with Planktos Corp. (formerly Diatom Corporation) dated January 12, 2007 (incorporated by reference to the Company’s Form 8-K filed with the Commission on January 19, 2007).

10(vii) *     Amendment to Consulting Agreement with Bay Cove Capital Corp. dated May 1, 2007(incorporated by reference to the Company's Form 10-QSB filed with the Commission on August 12, 2007).

10(viii) *     Securities Exchange Agreement and Plan of Exchange with Enwin Resources, Inc. dated May 31, 2007 (incorporated by reference to the Company’s Form 8-K filed with the Commission on June 4, 2007).

10(ix) *     Release and Settlement Agreement with Russ George dated February 22, 2008 (incorporated by reference to the Company’s Form 8-K filed with the Commission on March 21, 2008). 

14*          Code of Ethics adopted March 30, 2004 (incorporated herein by reference to Form 10-KSB dated April 1, 2004).

21*          Subsidiaries(incorporated herein by reference to Form 10-Kdated April 15, 2009).

31      Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (attached).

32     Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(attached).

      *      Incorporated by reference to previous filings of the Company.

               

26

Return to Table of Contents

----