The idea that green is the new tech was brought home this week in San Francisco when one of the chip industry’s biggest trade shows, SEMICON West, was held in conjunction with a huge solar trade show, Intersolar North America. The geeks and the eco-freaks together under one roof.
Not surprising, really. It has been oft-observed that much of the solar cell industry today is essentially an offshoot of the chip biz; both use the same basic building blocks – silicon – and common manufacturing processes. Cypress Semiconductor saw that early on and has profited greatly from an acquisition that has eclipsed its chip business, solar module maker SunPower (SPWR).
Almost two years ago, Applied Materials (AMAT), the world’s biggest manufacturer of the machines that make computer chips, jumped into the solar business. It reconfigured equipment used to produce flat-screen televisions and displays to print thin-film solar cells on the same plates. (Thin-film technologies vary, but essentially solar cells are printed or layered on sheets of glass or flexible materials.)
Applied has sold $3 billion worth of contracts for a dozen solar-cell factories that will be able to crank out 1.5 gigawatts’ worth of modules a year by the end of 2010, said Applied chief technology officer Mark Pinto at a lunch Green Wombat attended on Wednesday at Intersolar. To get an idea of just how hot solar is, consider this: Pinto estimates that in just two years solar will bring in 20 to 30 percent of Applied’s revenues.
“Energy generation has been void of technological development for 50 years and that makes it ripe for change,” said Applied CEO Mike Splinter. “It’s all about engineering and the environment.”
For photovolatics, it’s all about getting the costs per watt down to compete against fossil fuels. Part of that involves improving the efficiency of solar cells, but it’s just as much about reducing manufacturing and installation costs.
To that end, Applied was showing off its latest product (or to be exact, the product made by its machines): Out on a deck at the Metreon center across from the San Francisco convention hall sat a supersized thin-film solar panel measuring 5.7 square meters (7.2 feet by 7.5 feet) that is but an inch or so thick. The panels, which produce about 500 watts each, are designed for solar farms. The large size means that a 10-megawatt solar power plant would require 20,000 Applied panels versus 150,000 conventional-sized panels, cutting overall costs by 17 percent, the company claims. Installation costs fall dramatically as the panels attach to mounting racks with just two screws and plug into the circuit with two wires.
“We think the cost to produce and install is less than the average cost of electricity in California,” said Pinto.
Thin-film panels like the one in the photo above cost less to make than conventional bulky solar modules, but they are much less efficient at converting sunlight into electricity – around 6 percent versus 20 percent. However, they tend to work well in diffuse sunlight – i.e. foggy San Francisco – and can be integrated into building facades. The panels could also be made semi-transparent and transformed into electricity-generating windows for skycrapers.
Don’t expect Applied’s booming solar business to translate into a lot of green collar jobs in the United States. So far, it has not sold one solar cell factory here. Europe’s solar tax incentives have made it the market for Applied, with Asia set to become another big play in the coming the years. At home, meanwhile, the looming expiration of a crucial investment tax credit for renewable energy is discouraging expansion of the solar economy.
That doesn’t mean that demand has slowed. Southern California Edison (EIX), for instance, this year announced plans to install 250-megawatts of solar arrays on warehouse rooftops in the Southland. (This week it awarded the project’s first contract to thin-film company First Solar (FSLR) to build a 2-megawatt array in the sun-baked city of Fontana.)
But given that there’s only one thin-film factory currently in commercial operation in the United States – First Solar’s – the panels for Edison’s project and others will be coming from overseas. It makes no economic or environmental sense, of course, to ship huge pieces of glass across the ocean to California. (CORRECTION: As a couple of readers have pointed out, Energy Conversion Devices of Michigan operates a thin-film factory in the U.S.) But as Splinter put it about the lack of a coherent U.S. renewable energy policy and the investment tax credit mess, “This is the biggest miss in a long, long time.”
Green Wombat 
http://greenwombat.blogs.fortune.cnn.com/2008/07/18/applied-materials-solar-success/?source=yahoo_quote
AMAT is far from a success here. First, they are bleeding cash for little profit solar will ever get them. Remember, solar cells are manufactured with the same equipment that make ordinary chips and even 4 inch tools can produce very efficient solar devices. AMAT is way too big to adjust do market demand and technology leaps in this domain. I put my money elsewhere.
In my view, solar energy is a really good thing. It has a lot of advantages and just one major disadvantage: high cost of production and installation. Its main advantages are a free maintenance, low price, clean air, and protected environment.
Ok article for the most part, but factually wrong on at least one fact. Author states that the only commerical thin film factory is FSLR. Try ENER (Energy Conversion Devices) as well with thin film silicon. Or does Michigan not count as part of the U.S.?
FSLR is not the only manufacturer of thin film PV in the U.S. Energy Conversion Devices, Nanosolar, Konarka and others have factories in the U.S.
fair enough, but it is frigthening to realize that 7 years after 7/11 the US still does not have a comprehensive feed-in tariff.
AMAT is not using semiconductor equipment to make solar panels. It’s using flat screen machines to make solar panels. Do you remember paying $5000 for the first LCD television that you pay $500 for now… AMAT made the equipment that mass produced the LCD’s for Samsung, Sharp, and just about every other major player. The key is that you first need the manufacturing capability to mass produce in order to drive overall cost of solar panels down.
AMAT has shown tremendous foresight to capture the entire factory cycle of equipment including the factory building and the process controls. Now instead of selling just equipment, they will be selling factories with guaranteed performance.
Now if someone or a hedge fund could start a manufacturing plant in California our economy would see a direct benefit.
Todd,
I believe you left out the single most important thin film solar company-Nanosolar (see nanosolar.com). Nanosolar is located near San Jose, CA and has the most advanced thin film technology in the world. In June of this year Nanosolar demonstrated a thin film ‘printer’ that is capable of producing 1 gigawatt of solar film per year. If you were to compare the cost of producing electricity from coal (formally the cheapest way to produce electricity) and the cost of producing electricity from Nanosolar’s solar film, solar film handily wins. For this reason alone Nanosolar is poised to become the largest and most influential company of the next 20 years (at least this is my prediction).
Another CEO who doesn’t know squat about what he’s talking about! Having spent 40 years in power plant engineering and construction, I can assure you that many advances have happened in the last 50 years. Take gas fired combined cycle for instance – 50 % efficiency compared to high 30’s to 40 for standard steam plants, rapid start gas turbine simple cycle for peak loads, not to mention the new generation of advanced BWR and PWR nuclear plants being built around the world by US companies ( unfortunately none as yet planned where they will be needed most as we move toward electricity 24-7 for cars and rail in the US). Who knows maybe we can all find employment in the “Think and Know” economy while China gets rich and we listen to the chattering class tell us we don’t need any heavy industry – just let Vietnam and China do all the “hard,dirty” work. Has anybody forgotten that they are still hardline totalitaian states with no personal freedom – wake up you CEO eggheads – smell the air -its filled with the pollution of American self doubt. Its time to reign in the political trade giveaways and make Americans competitive again in all areas – don’t buy anything Chinese until they have free labor with bargaining rights to help equalize working conditions and environmental controls, etc.
It’s fun to live in the 21st century ! we can finally grasp all this free energy (that’s been here all along), but, we will need incentives to mass market this energy. Did you know that in CA, you need a permit to install solar cells on your roof ? all the more complicated. In Europe, the IRS gives tax breaks to whoever wants to install it… and it’s quite a tax-break. So, Mr. Bush, clean out the federal tax mess and, for a few dollars more, unleash this energy.
we need to be more eco-friendly and money wise it will prevail over ever increasing cost of finite resources.