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How long will the PV venture funding boom continue? September 14, 2007

Posted by fukumimi in Economy & Business, Energy, Japan, Overseas.
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Lots of and lots of money being ploughed into photovoltaics at the moment, especially hot is non-Si thin film solar. Nanosolar, Heliovolt, Miasole, Solyndra, DayStar, the list goes on. Each one has raised tens of millions of $ of VC financing. Most of these non-Si PV companies are doing CIGS (Cu-In-Ga-Se) thin films or variations thereof, but it seems things are not going to plan in the world of thin film solar ventures. Lots of reported management changes, including this latest one, but the money keeps pouring in.

It appears the companies are finding the transition from the lab to factory a bit more difficult than they had imagined.

To be fair, First Solar (NASDAQ:FSLR)seems to be doing great, recently closing a $1B+ deal with EdF. (Current market cap $7.2B) They have a different technology, based on a CdTe thin film process.

Meanwhile, Si-based PVs keep on being cranked out, and the supply side issues for Si are being addressed with PV grade Si production ramping up.

Of course, some people are further along the path to mass production CIGS-type PV cell production. Whilst Japan is recognized as a significant player in Si PV production, the competition to the thin film PV ventures from Japanese interests have not really been convered in much detail (the cleantech community seems aware of these Japanese players, but the investment community seems to prefer to pretend this competition does not exist). You see statements like this from the above CNET article –

“CIGS aren’t in mass manufacturing yet anywhere and cracking that problem is proving tricky. There are several companies trying to bring products out and each has a slightly different manufacturing technique.”

Honda Soltec, a 100% subsidiary of Honda Motor Company, has been selling CIGS modules since June 2007. Soltec’s manufacturing facility is currently just 27.5MW/yr, but it is expected that Honda will ramp up as large scale manufacturing techniques are validated.

Showa Shell also announced that they are building a second factory to produce CIS based modules adding a further 60MW/yr to the current 20MW/yr from their first factory which began operations last year.

Both companies have years/decades of R&D behind them, and they have immense resources in manufacturing at their disposal. I know what kind of company I would bet on to succeed in the lab to mass production transition, all else being equal. (My investment thesis focuses on this qualifier. There are plenty of areas for improvement in the current state of the art in thin film manufacturing)

Interesting to note, both companies have their PV factories in Kyushu. Kyushu, which was already dubbed Silicon Island due to its strength in the semiconductor sector (major players with production facilities include Sony, Toshiba, Mitsubishi Electric, Rohm, Toyoda Gosei, TI Japan,Canon, Kyocera, Renesas, NEC, AKM, Matushita, Yamaha, Pioneer) is rapidly becoming photovoltaic island as well, with Honda Soltec and Showa Shell being joined by players such as Fuji Electric and Mitsubishi Heavy Industries (both a-Si manufacturers), and SUMCO recently announcing that they are building a new PV silicon wafer plant in Imari with a n equivalent capacity of 300MW/yr.

Comments»

1. Chang - September 16, 2007

I’ve always expected to Martin Roscheisen’s Nanosolar to take off. He’s a hell of entrepreneur with an awesome track record. But it’s been 4 years and no big surprise from Nanosolar yet – maybe these things do take time.


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