SOLAR:

New Southwest factories to make advanced panels, but will they transform sun power?

LA JOLLA, Calif. -- A large solar panel sits atop a 22-foot tower at the University of California, San Diego, tilted toward the sun on a late spring morning. It appears similar to others in this beach city, but some say it will revolutionize the solar business.

The panel at the school makes two to three times as much electricity as a similar-sized conventional solar, said Soitec, the France-based manufacturer. Lenses on the surface focus sunlight onto solar cells while a tracking system shifts the panel every 10 seconds to always face the sun.

"From the moment the sun comes up over the horizon in the morning, our tracker is focused on it and remains focused on it throughout the day," said Mike Armstrong, Soitec's head of U.S. business development.

"At the end of the day as the sun goes down," Armstrong added, "it will come all the way back to the eastern horizon and wait precisely where the sun will rise the next morning."

Soitec's panel uses a technology known as concentrated photovoltaics, or CPV. The company, which calls its Concentrix CPV panels an important advance in green energy, recently announced it would manufacture the panels in San Diego County and sell them to developers in the southwestern United States.

That comes after fellow CPV maker Amonix Inc. in May opened an $18 million factory in north Las Vegas, built with the help of a $5.9 million investment tax credit from the 2009 stimulus legislation.

The moves could provide an important test of whether CPV represents a real advance, analysts said. The technology has existed for several years but so far has not resulted in a market shift.

"There are a lot of companies that have tried to do it, but no one has really broken through and been able to be a major producer," said Ken Zweibel, director of the GW Solar Institute at George Washington University. It is not yet possible to determine whether the technology is a significant advancement, he said, because "nobody has enough data in the marketplace."

Soitec, Amonix and other CPV companies hope to change that.

Soitec, a semiconductor maker, has signed contracts with San Diego-based utility San Diego Gas & Electric Co. to build 155 megawatts of panes, enough to power 55,000 homes. Tenaska Solar Ventures has struck a deal with SDG&E to use Soitec's Concentrix panels for a 150-MW project. The modules can be made in an economic way, Armstrong said

In addition to the deal with SDG&E, the company is in discussions with developers in Arizona and Nevada, Armstrong said.

In a "year or two" concentrated photovoltaics will have a significant market presence, predicted Geoffrey Kinsey, director of research and development for Amonix Inc., an Orange County, Calif.-based competitor to Soitec.

"These big projects are what we need to get to scale," Kinsey said. Prices of the technology will drop, he said, as developments reach the 100-MW range. "We've got what it takes," he said. "This is our chance."

Amonix has "a little more of a foot in the door" than Soitec in commercial production, Zweibel said

For San Diego, Soitec's manufacturing plan represents a major advance for the region's clean technology push (Greenwire, April 23, 2009).

Previously the area had seen manufacturers leave for less expensive places to operate. Siliken Renewable Energy last year moved its solar panel-making operation from San Diego to Mexico. (The company still has offices and a warehouse in San Diego County.)

There have been some green energy advances in the region, although on a smaller scale than what Soitec is proposing. Kyocera, a Japanese conglomerate that makes a host of products, opened a solar panel-making operation in San Diego last year.

The company already had a solar panel manufacturing plant in Tijuana, Mexico, that opened in 2004 and a San Diego plant that makes microelectronic components. That meant a ready manufacturing capacity, said Cecilia Aguillon, director of market development & government relations for Kyocera Solar Inc.

California is the largest solar market in the United States, and within the state, San Diego boasts the most households with solar rooftops (see related story).

"As a manufacturer, you need to look at the time and cost of shipping," Aguillon said. "You would like to be as close to the market as possible."

California's renewable power mandate added to the decision to locate in the state for both Kyocera and Soitec.

The Golden State has the country's most aggressive mandate for green power generation, requiring that clean sources represent 33 percent of power sold by 2020. The state's climate law A.B. 32 in 2013 will place mandatory caps on carbon emissions.

The Soitec factory would create about 450 jobs at the plant and another 1,000 indirect employment positions, Armstrong said. If Soitec goes through with the plant, it will mark a major success for San Diego clean technology efforts, said Jacques Chirazi, San Diego's clean-tech program manager.

Soitec's manufacturing process is similar to that of semiconductors, he said, and requires a labor pool with "a higher level of expertise.

"We've been working with them for a long time," Chirazi said of Soitec. "It's the goal of what we've been working for here."

Making more power

Although concentrated photovoltaics have existed for about 20 years, they were not commercially competitive until about 2006, said Kinsey with Amonix. There was then a major leap in the technology, the solar cells were able to turn 30 percent of sunlight into electricity.

"That just shifted the system economics," Kinsey said. "Suddenly the cost of building these big trackers finally made sense."

Concentrated photovoltaics turn more of the sun's power into electricity than conventional solar.

With flat panel photovoltaic systems, about 12.5 percent of the heat that is generated ultimately becomes electricity, and for thin film solar, it is about 8 percent Armstrong said. The rest goes unused.

Concentrix CPV panels with the trackers, he said, convert about 25 percent of the solar rays into usable power. The panes capture three wavelengths compared with the one wavelength of light most solar grabs.

But because the cost of the energy typically is still more expensive than traditional flat-panel solar, questions remain about its marketability, analysts said.

Efficiency is important but not the only factor that affects the success of solar manufacturers, said Joshua Linn, a fellow at Resources for the Future.

"At the end of the day, what matters is going to be the cost of the energy that you're creating," Linn said. "That's going to be the most important thing."

Even if you can convert 100 percent of sunlight "if your costs are 100 times higher," you won't succeed, Zweibel said. Makers of concentrated photovoltaics, he added, "have a ways to go in terms of credibility to ultimately prove that their cents per kilowatt is better than the cents per kilowatt-hour for a flat plate."

For utilities, the price of power is not the only factor, said Jim Avery, senior vice president of power supply for SDG&E.

Traditional solar hits peak power generation once a day, when the sun is at its highest level, Avery said. After that, the amount of power it can make drops steadily. But demand for power typically rises in the afternoon and peaks around 4 or 5 p.m., he said.

Because a concentrated photovoltaics panel sits on a tracker that moves throughout the day, it continues making steady amounts of energy when utilities need it most, Avery said.

"They not only provide us energy, they provide us capacity," Avery said. "The amount of energy that they can provide us over the day is considerably higher," than that of rooftop photovoltaics.

The price that Soitec wanted for the panels also was "very competitive," Avery said.

Concentrated photovoltaics also can reduce some costs, Linn said, such as land and wiring needed for larger systems. Less space is needed because they are more efficient.

"If the cost of the module is higher, that's working against you," Linn said. But there is "a lot of excitement" about the concentrated photovoltaics, he said, adding "they could be pretty promising.

Concentrix panels benefit from economies of scale, Armstrong said. A thin-film solar project that took up about 10 acres could be done in about 6 acres with Concentrix panels, he said, adding "you really do get a significant savings there. You get to buy 40 percent less land. All of that eventually makes it into the consumer's pocket."

The panels, because they sit off the ground and rotate, also can be put in areas with grazing of animals or crops growing underneath, Soitec said.

The solar panel market is very competitive right now, said Chirazi with the city of San Diego, and manufacturers look for ways to lower their costs.

"The prices [of panels] have dropped substantially over the past three years," Chirazi said, falling to about $1.50 per watt from about $5 a watt. That is for the traditional solar panel and does not include installation and other costs.

But in addition to the higher costs, concentrated photovoltaics are limited in where they can be used. They are best in high sunlight areas like Arizona, Nevada and the Southern California desert, Zweibel said.

"It's really competing with flat plates in the sunniest places," Zweibel said.

Picking factory sites

Soitec's decision to open a factory in San Diego came as the deals came together with SDG&E and Tenaska. SDG&E had asked developers to submit proposals for power, Avery said. The utility prioritizes efficiency and renewable power where possible, he said.

SDG&E had been negotiating with Tenaska separately, he said. At that point Soitec was looking at various locations throughout the Southwest that could be sites to manufacture their CPV technology.

Tenaska, Avery said, proposed bringing the three parties together. Tenaska said that it would use Concentrix panels for some of the solar development contracts that it had with SDG&E, if that helped bring the Soitec factory to the region. Soitec then separately submitted other proposals for solar, Avery said.

Soitec already had decided to put the North America headquarters of its solar operation in San Diego. The factory location choice came in part, Armstrong said, because of relationships the company developed with the University of California, San Diego, which allowed space for the demonstration Concentrix panel, and SDG&E.

"They entertained the idea of negotiating with us the opportunity to possibly place a factory here," Armstrong said. "One of the things that obviously drives factories is orders." SDG&E, he said, agreed to talk about buying power at a set price. Through those agreements, he said, "you create a pipeline for the factory."

The Kyocera plant, meanwhile, makes 30 MW of panels per year, about enough to power 8,580 homes, assuming each project has an average size of 3.5 kilowatts. The plant in Tijuana is far larger, manufacturing 240 MW per year, an amount able to power 68,570 homes. That plant has been increasing capacity every year, Aguillon said.

Kyocera, which makes conventional photovoltaic panels, decided to add some manufacturing to San Diego so that it could be close to multiple locations where the panes are sold, said Aguillon. From San Diego, the company has a perch to serve both the western United States and Mexico.

"You have access to two large markets from the border region," Aguillon said.

As well, she said, San Diego universities are working on the wind, solar and algae innovations. And electric utilities in the state cooperate with energy-related businesses, she said.

"California has really been active in incubating companies and helping companies grow," Aguillon said. "The market here is promising."