Nanosolar to Build a thin-film manufacturing plant in San Jose, California
By Jennifer Kho / December 12, 2006
Source: RedHerring
http://www.redherring.com/Article.aspx?a=20207&
Nanosolar announced Tuesday it will build a thin-film manufacturing plant in San Jose, California, on the site of a former Cisco facility, and another near Berlin. The startup says it’s ‘on track.’ The world’s largest solar PV factory will begin production in Bay Area in 2007. The Red Herring 100 company says the sites total 647,000 square feet, and will be used for manufacturing solar cells and panels, for research and development, and for offices.
The startup is starting to move into the facilities now. It is renting the San Jose facility, and bought the German building from foreclosure, a spokesperson said. Both factories are expected to be completed in 2007. The company didn’t say what initial production numbers would be, or how long it would take to ramp up to full capacity.
In June, the Palo Alto-based startup announced it raised $75-million in a Series-C round of venture funding—along with $25 million in government subsidies—and said it would used the money to build the world’s largest photovoltaic solar factory in the Bay Area, and a panel assembly factory in Berlin (see Nanosolar Gets $100M for PV).
The company said the Bay Area facility would have an annual capacity of 430 megawatts once it’s fully built, churning out about 200 million cells per year, and the Berlin site would produce more than 1 million solar panels per year. News that the sites have been secured indicate the thin-film technology could be stepping closer to reality.
A Tech With A Past
Thin-film solar cells use little or no silicon, the costliest part of most solar cells, and companies claim they will be able to lower costs beyond silicon-based cells. But researchers have been working on thin films for years. Thin-film solar has a long history of disappointments, due to manufacturing difficulties and reliability problems, among other things.
Nanosolar is one of a number of thin-film startups that claim new materials and manufacturing technologies could solve the problems. The facilities are a chance for Nanosolar to prove itself, and the viability of thin films. So far only a few thin-film companies have begun manufacturing, including First Solar, Energy Conversion Devices’ Uni-Solar, and Global Solar Energy, and they are still at low levels.
Analysts say there are plenty of risks in ramping thin-film solar up to full-scale manufacturing, including a tendency to be overly optimistic. “In general, for smaller, newer tech companies, there is an unrealistic optimism about equipment purchase deadlines, the specifications of feedstocks, and the [speed at which] they can learn,” said Michael Rogol, managing director for Photon Consulting. “Those three things together seem to be potential areas where they might not achieve their goals.”
He added that thin-film companies such as Nanosolar are trying to move as quickly as possible, and “maybe even faster than possible.” “They are moving at breakneck speed with processes that are new, teams that are new, and technologies that are new,” he said. “It might not work the first time.”
Risks and Rewards
Jesse Pichel, a vice president and senior research analyst for Piper Jaffray, also warned of risks. “There’s a significant ramp risk involved with a company that’s not in production, and Nanosolar’s not in production in meaningful scale or volumes,” he said. “With a thin-film company, it’s all about the ramp to production, because you can make anything in the lab, but getting it to run on volume-production machines is a completely different issue. It’s a big theme there in thin film.”
Still, he said Nanosolar is one of only a handful of companies that have the potential to ramp a low-cost, thin-film product up to meaningful production quantities. He added others might be further along, though, naming such competitors as Miasolé, Greatcell Solar, Sharp, and Q-Cells subsidiaries Calyxo and Brilliant 234. “Until they’re running, it’s a venture-capital company,” he said.
Nanosolar certainly is well-funded, one advantage as it sets up a supply chain. Aside from the Series-C round, the company had already raised $58 million (see 10 Cleantech Companies to Watch, Nanosolar Raises Funding). It hasn’t disclosed what government subsidies it received or even which government they are coming from.
Mr. Roscheisen says Nanosolar is on track to reach mass production next year. The company has already defined its requirements and selected its suppliers, he says, although he wouldn’t disclose names or details. “We’ve figured it all out; we have a lot of the key supply agreements in place,” he says. “Now we’re doing the last bit of process development to take it to the level where we’re commercially impactful.”