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Salam sejahtera

and greetings from


Malaysia

Solar photovoltaic (PV) industry has been growing


exponentially and excitingly over the last ten years. PV
companies which were started pre-millennium, were
mostly very small with less than ten employees. But
today their market values are in billions with hundreds
of staff all over the world. Still, their future prospects
are as bright as the SUN.

Recognising the opportunity, on 18th August 2006, the


YAB Prime Minister of Malaysia launched the Third
Industrial Master Plan (2006-2020), with solar PV
identified as one of the focus technology. Through the MBIPV Project, Malaysia is pedantically
building the right infrastructure to create a sustainable PV market, and a strong local PV industry.
The emphasis towards local industry is to enhance the service quality and establish successful PV
manufacturers.

To achieve these goals, MBIPV Project is currently working with MPIA to set up a competency
based PV training programme, and a quality scheme called ‘Approved Service Provider’ (APVSP).
We aspire for our local PV service providers (PVSP) to provide quality services locally and beyond
Malaysia. As such, we offer opportunities for our PVSP to hone their skill through the National
SURIA 1000 programme.

We also invite international PV companies to collaborate and work with our property developers
through the ‘SURIA for Developer’ programme. Our aim is to create the first property development
which incorporates BIPV as a standard feature, to achieve our PM’s aspiration of Wawasan SURIA.

We are also working very closely with MIDA to make international PV manufacturers to select
Malaysia as the preferred location for their manufacturing facilities. Malaysia can provide many
attractions that can make any decision to relocate to Malaysia as a wise decision. But, our challenge
has always been to create adequate awareness of what Malaysia can offer.

Therefore, it is my greatest wish to see the Malaysia PV Industry Days become a fruitful platform
for international and local PV partners to find business opportunity, and to facilitate your plan to
establish PV manufacturing facilities here in Malaysia.

Ir. Ahmad Hadri Haris


National Project Leader, MBIPV Project
August 2007

PV Industry Magazine August 07 3


3 Message from National
C Project Leader, MBIPV Project –
Ir. Ahmad Hadri Haris

O 6 Message from President of


MPIA – Shamsudin Khalid

N 9 Global and National Photo-


voltaics Business – Daniel Ruoss

16 Local and Global


T Manufacturing Opportunities in
Photovoltaics – Daniel Ruoss

E 21 The PV Industry Value Chain


– An International Snapshot
– Greg Watt

N 25 Latest PV Business News –


Daniel Ruoss

T 28 Market Movers of Solar


Photovoltaics in Malaysia –
Wei-nee Chen

S 31 Overview of Japan’s PV
Industry – Izumi Kaizuka

33 Global PV Industry
Development Since 15 Years –
Daniel Ruoss

About us
MEDIA SPONSOR SPONSORS
(www.roofandfacade.com)
• Bandar Eco-Setia Sdn Bhd
FrontMedia Network Sdn Bhd • Envision Sdn Bhd
Julie Chong Cheng Sim • HUBER+SUHNER (Malaysia) Sdn Bhd
julie@medialink-mail.com
• Malaysian Industrial Development Authority (MIDA)
Dr Parvathy Subhadra
paru@medialink-mail.com • Mitsubishi Electric Asia Pte Ltd
• Malaysian Photovoltaic Industry Association (MPIA)
Benjamin Ng
ben.ngha@gmail.com • Multi-Contact (South East Asia) Pte Ltd
• OC Oerlikon Balzers Pte Ltd
Pamela De Silva
production@medialink-mail.com • Pegasus Business and Market Advisory Sdn Bhd
• Phoenix Solar Pte Ltd
MEDIA CONTRIBUTORS • Solamas Sdn Bhd
Ir. Ahmad Hadri Haris; Daniel Ruoss; Wei-nee Chen; • SolarWorld Pte Ltd
Malaysian Industry Development Authority (MIDA); • Sputnik Engineering AG
Greg Watt; Izumi Kaizuka; Shamsudin Khalid • SunTechnics Pte Ltd

4 PV Industry Magazine August 07


Dear Industry Members,

The Malaysian Photovoltaic Industry Association


or MPIA was formed to bring industry players
together to develop and expand the photovoltaic
(PV) market in Malaysia. It also seeks to bridge the
industry and policy makers, acting as the industry’s
voice, seeking to propel the industry forward in a
positive manner.

Though Malaysia, in general, is highly accessible


to grid power, still there remain many rural areas
suffering from unavailability of electricity even today. Since the launch of 9th Malaysia Plan,
much has been said about solar applications, especially solar hybrid systems. Solar PV
awareness has also improved significantly, particularly at governmental levels and with the
general public. The implementation of the Suria 1000 programme will further help propagate
this understanding.

The MPIA hopes that this development will bring about an expansion of the PV market.
Inconsistent quality of past installations has added to the perception that solar is not only
expensive but also unreliable. The MPIA seeks to rectify this notion and improve the situation
by assisting the industry to ensure quality for the systems being applied. Tax and duty issues
continue to hinder competitive pricing when compared with more established markets in
Europe, Japan, or the US.

The MPIA looks forward to the abolishment of duties and sales tax for relevant components
of PV systems. Lower prices will certainly go towards motivating an even larger portion of
the population to adopt PV as their way of contribution to the environment preservation.
With this in mind, we look forward to further adoption of photovoltaic (PV) power in both
commercial and government projects in the near future. We look forward to bright and sunny
days ahead.

Shamsudin Khalid
President
Malaysian Photovoltaic Industry Association

6 PV Industry Magazine August 07


MALAYSIAN PHOTOVOLTAIC
INDUSTRY ASSOCIATION
The Driving Force & Voice of Malaysian Photovoltaic Industry…..

FORMED in the Year 2006, Malaysian Photovoltaic Industry Association, MPIA, is committed to bring
effectiveness and sustainability in the implementation of Photovoltaic Technology for successful &
reliable Renewable Energy Projects implementation in Malaysia with consistent quality control.

OBJECTIVES & GOALS OF MPIA:

1. Be a Resource Centre for the Photovoltaic Industry Stakeholders.


2. Be the Watchdog in the implementation of various PV Projects to ensure Quality.
3. Provide Training and Workshops for its Members to enhance competency.
4. Be the Voice of the Industry for Government and Policy makers.
5. Create Awareness of PV potential among the Organisations and General Public.
6. Make technical recommendations or set standards to avoid inconsistent quality in PV projects.
7. Set up a One Stop Centre for PV, Stand Alone & Grid Connected. The Centre would benefit the
Industry stakeholders/ PV Service Providers as well as for the PV system users and of course the
General Public.

The PV Technology is a renewable energy solution that helps us in energy conservation to combat
Global warming and Climate change. With support from all the stakeholders, MPIA can become
instrumental in ensuring PV to be an effective and sustainable solution.

MPIA ENVISIONS COST EFFECTIVE AND RELIABLE PV INSTALLATIONS

MPIA COMMITTEE MEMBERS (2006-07):

Standing from Left: Mak Hong Seng (Putra Perdana),


Kenneth Chang (Mitsubishi Electric), Udupi Krishna
Kumar (Matrix Energy) and Paul David Millot (Australian
Solarvoltaic)

Sitting from Left: Lionel Yap (Solamas), Shamsudin


Khalid (Sharp-Roxy), Zairul Azren (Matrix Energy) and
Sivaganthan J. (Bestium Technologies)

SECRETARIAT
PERSATUAN PERUSAHAAN FOTOVOLTAIC MALAYSIA
Unit 510, 5th Floor, Block A, Kelana Business Centre,
No.97, Jalan SS 7/2, Kelana Jaya, 47301 Petaling Jaya,
Selangor Darul Ehsan
Tel : +603 78809499, Fax : +603 78809433
Email : sivag@bestium.com.my, aznura@bestium.com.my
Web Page : www.mpia.org.my
Global and
National
Photovoltaics
Business

Global and National


Photovoltaics Business
due to bottleneck in silicon supply.
By Daniel Ruoss, The fact is that the PV market Cost (estimated in US$ billion)
International Consultant is growing rapidly! The following
Cost for FiT = 4.4
MBIPV figures presented are based on
research and comparing data from Increased cost for stand-by
REN21, Photon International, IEA- charges = 0.14
15 GWp (source: PVPS, Greenpeace, Paul Maycock,
Photon
International) or 7 GWp (source: and others. In the last seven years Transaction cost = 00027
EPIA) cumulative installed PV the overall PV market was growing
capacity by 2010? More than 1 GWp between 35% to 42%, and grid- Total = 4.54
(source: Photon International) connected PV exceeded 40% growth
Benefit (estimated in US$ billion)
installed capacity in Germany in in the last five years. The grid-
2006 or 750 MWp ‘only’ (source: connected PV market accounts for Reduction of tariff for VL
International Energy Agency approximately 77% (~5.6 GWp as at consumers (Merit order effect) = 6.87
Photovoltaic Power Systems end of 2006) of the overall installed
Programme, IEA-PVPS)? Correct PV capacity and is the fastest Savings from energy import = 1.237
values are of great importance and growing RE market worldwide. 23%
provide the industry verifiable (~1.7 GWp as at end of 2006) are off- Socio-economic benefits - 4.672
means of benchmarking and grid PV systems and few
planning of the production. (approximately 5%) are already Total = 12.8
Unfortunately today the values for installed economically viable
forecast and even annual installed without the need for subsidies. The Table 1: Cost vs. benefits of EEG in
Germany (Source: BMU, June 2007)
capacity are in dispute, e.g. rest (~18%) receives financial
European PV Industry Association support from NGOs, donor countries through aid program, from donor
(EPIA) vs. Photon agencies, such as United Nations
International, a leading Programmes (e.g. Development or
PV magazine, and the Educational), Global Environment
IEA-PVPS, where data Facility (GEF) or World Bank. By
is often very End of 2006 the cumulative
conservative compared installed PV capacity was
to Photon International approximately 7.2 GWp resulting in
figures. The IEA-PVPS total annual revenues in 2006 of
covers member US$ 12-13 billion (RM45 billion).
countries only and is But we have to keep in mind that
strongly depending on the grid-connected PV market,
individual country although booming like mushrooms,
expert (often only one) the PV growth is completely driven
to provide accurate by sustainable policies implemented
data. by governments in various
Market size matters countries, such as Germany, Spain,
– the industry and other USA, Italy, France, South Korea,
stakeholders have to Greece, and others. In fact, it is not
know the status quo of the industry that is driving the
the market to plan for market but politicians with
the mid and long-term. commitment and a long-term
Presently one has to use perspective for a sustainable future.
the published data with Policy driven programme helped
care and compare with the global PV industry to expand
one or two other sources quickly and position itself stronger
c l o s e l y. F u r t h e r m o r e , against conventional energies. As at
one should compare mid of 2007, the PV industry has
statistics for installed created more than 300,000 new jobs
PV with the annual PV worldwide (source: Greenpeace),
production. Production whereas in Germany alone
will follow demand and approximately 50,000 jobs were
in 2007, production created (source: Bundesverband
should meet demand, Solarwirtschaft BVS). It is
whereas in the last few Governor Schwarzenegger – a committed PV estimated that in Germany by 2020,
years the demand was champion with muscles to implement a sustainable jobs created in RE manufacturing
exceeding production, PV programme in California. • See page 11

PV Industry Magazine August 07 9


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We can provide you with all mass production steps including metrology and www.oerlikon.com/solar
guaranteed production ramp up. Our goal is to secure your success with the
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Global and
National
Photovoltaics
Business

• From page 9 i n v e s t e d g o t o ? Ta k e
will exceed those in machinery and Germany as an example,
in vehicle manufacturing! PV and Germany has a well
RE in general, is a job spinner and designed FiT pro-
brings great benefits to the country. gramme, including wind,
But we need to ‘fuel’ this spinner, biomass, PV, hydro and
and the ‘fuel’ today is a well geothermal. The pro-
designed, economically viable feed- gramme started in 2000,
in-tariff (FiT) policy. Today more and in a recent review it
than 40 countries have a FiT policy was presented that the
introduced. Some country benefit so far outweighs
programmes offer an economically the cost (source:
viable FiT, e.g. Germany, Spain, Bundesministerium für
South Korea, Italy, France, Greece, Umwelt, Naturschutz
and many more. Other countries und Reaktorsicherheit,
have a FiT but either timeframe of Figure 1: 10.5 kWp semi-transparent BIPV report on EEG
FiT is too short (e.g. Thailand – application at PTM-ZEO. experience, June 2007).
7 years only), or the cap on And what is the
the maximum cumulative installed significantly, create jobs, ensures status of PV policy in Malaysia? As
PV capacity is set too low energy s u p p l y, guarantees per August 2007 grid connected PV
(e.g. Switzerland, Portugal, investment security and grows the in Malaysia enjoys the following
Luxembourg), or the available tariff local PV i n d u s t r y, drives benefits:
is too low to make the PV system technological innovation and • Permission to connect such power
economically recoverable within the provides fair market conditions for generating equipment to the
15 to 20 years (e.g. Norway, Sweden, REs. The question is “Do the TNB’s low voltage distribution
Turkey, and other countries). benefits for the country supply network (240/415 volts 1
But a well designed feed-in tariff implementing a FiT scheme phase / 3 phase).
scheme is a policy to change the outweigh the cost resulting from the • Net Metering for TNB “purchase”
world. FiT reduces CO2 emission FiT policy?” Where do the billions of the PV generated electricity,
where the interconnection may be
at the point of TNB supply
connection (“Direct Feed”) or at
the user ’s internal distribution
board (“Indirect Feed”). Under
these conditions the PV generated
electricity sale equates to TNB
valuing the PV generated
electricity at the same rate it sells
the electricity to its customers.
• Accelerated Capital Allowance
(ACA) for commercial investors in
BIPV installations under the “RE
for own use” category of SREP
fiscal incentives.
In the pipeline; MBIPV project
Graph 1: Investment trends for manufacturing along the PV value chain. through the Ministry of Energy,
Wa t e r a n d C o m m u n i c a t i o n , h a s
proposed for PV incentives to be
enhanced through the National
Budget, to make it more attractive
for Malaysians to invest in PV
systems.
Over the last two years the
annual installed PV capacity in
Malaysia was in average 1 MWp to
1.5 MWp including off-grid PV
applications, which represent
approximately 70% of the total
i n s t a l l e d P V c a p a c i t y. S e v e r a l
initiatives in off-grid PV
application, such as ‘Schoolnet’, or
island electrification with hybrid
systems (Pulau Kapas), or projects
for rural electrification in Sabah
and Sarawak, initiated mainly by
Government agencies and TNB.
To d a y grid-connected BIPV
Graph 2: Profit trends for manufacturing along the PV value chain. applications are under the
• See page 12

PV Industry Magazine August 07 11


Global and
National
Photovoltaics
Business

• From page 11 potential for grid-connected PV in developed nation by 2020 (Wawasan


supervision of MBIPV Project and the built environment was 2020). In Sabah and Sarawak, few
concentrating mainly in the Klang estimated (in 2003) to be at least are still without access to proper
Valley due to better appreciation of 6500MWp. electricity supply.
the technology by the urbanities. It is important when developing Off-grid applications are an
But in SURIA1000 and also the the market and its stakeholders, to important and still growing sector
‘SURIA for Developer ’ programmes, follow a realistic learning curve and of PV business, in many cases very
BIPV applications can be installed to address the current industry depending on Government support,
in East and West Malaysia and capabilities in the design of a policy. but in some cases already
receive, if successful in bidding, The scenario for post MBIPV (2010 economically viable without any
Government subsidy. For example
in Indonesia, where the PV market
has been revitalized for the past two
years, thanks to strong demand of
PV hybrid solution for
telecommunication application on
hundreds of islands. And just few
years ago, a Government sponsored
solar-home systems programme in
Indonesia failed because no
ownership was created (100 percent
subsidized) and very poor
maintenance was provided. In an
economical viable market such as
telecommunications, the growth
and demand for PV becomes self-
driving and this makes PV business
a profitable venture.
The entry barrier for PV
business varies, depending which
Graph 3: Global PV market outlook (Source: Own estimations based on EPIA, part of the value chain one targets,
REN21, Greenpeace, Photon International) the investment can be up to several
hundreds million Dollars. Becoming
attractive financial incentives for onwards) proposes that the a PV system integrator or proving
the investment and the BIPV Malaysian PV industry (service service in design, consulting, and
systems are allowed net metering providers and manufacturers) other activities is with the least
with TNB and later on, with SESCO should become competitive before a barrier path to PV business. As
and SESB. In August 2007; the grid- follow-up high-impact (e.g. feed-in such, companies can easily fly by
connected cumulative installed tariff) PV programme is introduced. night and may be gone the next day
BIPV capacity in Malaysia Otherwise, Malaysia will not to the next attractive PV market
surpassed the 600 kWp level and benefit from the investment into PV with cash. Similar to module
the off-grid market is estimated to and justification for the PV program manufacturing, which requires
be 5-6 MWp cumulative installed to benefit the local stakeholder is minimal investment - for a 10 MW
PV capacity. very difficult. The PV industry has production facility US$1.1-1.7
Besides the proposed changes to two to five years (2010 to 2012/ million (RM4-6 million) – and can
the various Government agencies on 2015) to build capacity and become be set-up and operated quickly, but
procedures to facilitate RE PV competitive in the local and can be also dismantled and
growth, MBIPV is working towards international market. This follows relocated fast. The scene is different
a sustainable environment for the a realistic scenario similar to if one targets front end
widespread use of grid-connected lessons learned from Germany, US manufacturing, such as polysilicon
PV in Malaysia. The realistic target and Japan. production, ingot and wafer
until 2020 is to install 20 MWp The market in Malaysia will fabrication or cell manufacturing;
cumulative installed grid-connected develop in due course, although it this can incur investment cost
PV capacity, however the technical may not be as fast as in Europe but between US$70 to 125 million
hopefully more stable (RM250 up to RM450 million) for a
than in other Asean 100 MWp production facility. Graph
countries, e.g. 1 presents investment trends for
Thailand, Indonesia. different PV products in the value
Off-grid PV will be the chain. Please note, this graph
majority of PV should not be used for any design
applications and may of business plans as it presents
exceed 2 MWp annual trends only.
installed PV capacity One could compare the
by 2010 onwards due to investment in the different sectors
increasing support with the trends in profits (see graph
from Government on 2). On a normalized scale (100%),
Figure 2: Characteristics of the PV value chain (Source:
rural electrification, polysilicon and ingots/wafer
Pegasus Sdn Bhd) but will dwindle as manufacturing tend to achieve the
Malaysia becomes a • See page 14

12 PV Industry Magazine August 07


Global and
National
Photovoltaics
Business

• From page 12 profit tends to be high and for PV available considering a BAU
highest profit followed by solar module manufacturing profit tends (business-as-usual) scenario (35%
cell manufacturing. Module to decrease slightly, because any growth rate) for the development of
manufacturing tends to result in cost reduction is used to maximize the global market – see graph 3.
less profit than the upstream to a certain level the profit for the The annual revenues in 2010 are
manufacturers but profit still front-end manufacturers first. estimated to exceed US$40 billion
exceeds those in BOS manu- In 2007, FOB (free on board) (RM150 billion) and could reach
facturing or services sector sales price for high quality US$380 billion (RM1,400 billion) in
(installation and consultation). crystalline PV modules from China 2020 estimating an annual market
Yes, the future is promising for ranges from US$3.20-3.80/Wp of 120-140 GW – replacing over
PV business. Established PV (RM11.5-13.7/Wp) for an order of hundred to hundred fifty big size
companies are expanding around one to five 40ft containers nuclear reactors installed per year.
significantly their production (100 to 500 kWp). Production cost For reference and to provide a
capacity and numerous new is estimated at US$2.60-2.80/Wp perspective on the potential market
companies are entering the PV (RM9.4-10.1/Wp), which result in size of PV; in 2007 thirty three
business worldwide. profits of 20-35% for module nuclear reactors were under
In some business, e.g. inverter manufacturing. construction totalling 27 GW.
and module, competition is In a few years, due to decreasing How are we going to get there?
aggressive and almost every month, silicon prices the module production By economies of scale and new
new market entrants are trying to cost should decrease as the cost developments – upscaling and
get a share of the booming PV reduction in silicon manufacturing commercializing new technologies
market. But before one rushes is passed on through the PV value are keys to price reduction and
heedlessly into PV business, one chain. Photon International further market growth.
has to understand and consider Consulting estimated production In the next few years the
some important (but not limited) cost of high-quality crystalline PV spotlight will be on the European
requirements: modules in 2009/2010 in the range and US market, and demand will be
• Company should understand the of US$1.50/Wp (RM5.4/Wp). high thanks to Governments which
PV value chain and the market Cost reduction in end products understood the benefits of an RE
drivers and have a regional or will open new PV markets and add policy (including PV) and hence,
international network for to the increasingly attractive coming up with a long-term
procurement and sale of products. business environment. This leaves perspective to achieve a sustainable
• Establish strong collaborations plenty of room for future growing national energy policy.
with experienced partners, e.g. profit and new companies entering In the next two to three years,
JV, technical collaboration (MoA), the PV business. the industry should try to
and others. Here, an increasing number of consolidate, as today the market is
• Succeed in long-term supply companies are targeting the fast overheated, and this will help
contracts of your raw product. public listing to attract quick cash companies to improve their
• Have reliable power supply, low and achieve their aggressive and strategies over the next ten years.
electricity tariff and good access ambitious growth targets, e.g. We will have more IPO’s, new
to talented manpower. Chinese companies. partnerships between established
• Reduce dependence on export Other companies are attracting PV enterprises and newcomers to
market only. Create a sustainable venture capital or private equity to tap into the network and experience
local home market. fund their business strategy and a from a strong industry partner,
It is crucial to do extensive due few PV companies are closed for some bankruptcies may be possible,
diligence on market and close outside investment and still several companies with idling
competitors. Furthermore, one has perform very well. production equipment and few
t o a s s e s s o n e ’s o w n f i n a n c i a l There are different approaches; mergers & acquisitions.
capabilities, preferred location, each with its benefits, to diversify To d a y t h e h y p e f o r P V
infrastructure, accessibility to into PV business, either way the technology and business is at its
ports, etc. and come up with a sound question for new market entrants is peak, and the PV industry should
SWOT analysis leading to decisions often “where to enter the PV be mindful to use the momentum
before venturing into PV business. businesses”. and carry the positive support from
Support on above analysis can be As presented in figure 2, in back- the public and Government into a
obtained from several international end manufacturing (PV modules, long term sustainable business.
and local consulting companies and BOS) and system integration, an Once grid-parity is achieved i.e.
also from MBIPV team. Please feel increasing numbers of players are PV electricity price is competitive
free to contact any of the MBIPV established and investment is low, to conventional energy generation,
team, if your company has the whereas in silicon manufacturing the PV market will sky-rocket and
resources to invest in PV (see graph only few companies dominated the open avenues for new technologies
1) and if you are interested to enter market, but investment is very and innovative manufacturing
or diversify to the PV business in high. Wafer and PV cells production concepts to upscale. The industry
Malaysia. Also, please visit requires a high investment but less has to drive the market in the short
www.ptm.org.my/bipv to download than silicon, but competition is to mid term and not policy makers,
our facts & figures on business getting stronger as more companies who today have strong muscles
opportunities. establish in this sector of the value (commitment) to support PV, but as
Looking ahead, for front-end chain. we all know muscles tend to weaken
products (e.g. solar cells, wafers), But there is plenty of business over time.

14 PV Industry Magazine August 07


Local and Global
Manufacturing
Opportunities in
Photovoltaics

Local and Global Manufacturing


Opportunities in Photovoltaics
• Assist companies in the
By MIDA (Malaysian implementation and
Industrial Development operation of their projects,
Authority) and Daniel and offer assistance
Ruoss, International through direct
Consultant MBIPV consultations and
cooperation with the
Malaysian Industrial Development relevant authorities at both
Authority (MIDA) is Malaysia’s the federal and state levels
one-stop centre for local and;
manufacturing. With focus on PV • Facilitate cross border
business, MIDA is supported by Mr. investments and assisting
Daniel Ruoss and Mr. Mohd Nazri Malaysian companies to
Mohd Nawi from the MBIPV team to Figure 1: Leading PV players in Eastern Germany identify markets and
facilitate international and local investment abroad;
business contacts and provide updates the Federal Industrial Development • Facilitate the exchange of
on latest technologies and companies’ Authority Act, 1965, is the information and coordination among
news. MBIPV team is very experienced Government’s principal agency for the institutions engaged in or connected
in the PV business along the value promotion and coordination of with industrial development.
chain and familiar with local and industrial development in Malaysia. As a measure to further enhance
international PV stakeholders. To MIDA is the first point of contact for MIDA’s role in assisting foreign and
facilitate the growing interest from investors who intend to set up projects domestic investors, senior
local companies, we have designed a in the manufacturing and its related representatives from key agencies are
business development program, services sectors in Malaysia. Foreign stationed at MIDA’s headquarters in
including free consultation and investors can also contact MIDA for Kuala Lumpur. These officials are from
business plan. To upgrade local assistance in planning their fact- the Immigration Department, Royal
industry and support their business finding trip to Malaysia. Customs Malaysia and Tenaga
interest, we have designed our Headquartered in Malaysia’s capital Nasional Berhad. Other Government
programme in six thrusts: city of Kuala Lumpur, MIDA has representatives from relevant
T1: To understand the needs and established a global network of 16 ministries such as the Ministry of
requirements of the local industry; overseas offices covering North Finance, Ministry of Human Resources,
T2: To improve the image of the local America, Europe and the Asia Pacific Department of Environment and
PV industry and PV in Malaysia; to assist investors interested in locating Department of Occupational Safety and
T3: To stimulate interest and identify manufacturing operation in the Health, are also assigned to MIDA to
interested local companies to shift ASEAN region. MIDA will be opening assist in expediting various approvals.
towards PV; 10 new offices in Guangzhou, Dalian, MIDA has successfully implemented
T4: To design tailored programmes to Bangalore, Ho Chi Minh City, Jakarta, the ISO 9002 Quality Management
enhance local industry; Dubai, Johannesburg, Munich, System and has been awarded for the
T5: To explore Government support Bangkok and Houston, by the end of promotion of foreign and domestic
and collaborate with relevant this year. Within Malaysia, MIDA has investments in Malaysia’s
agencies on design for new 10 branch offices in 10 states, including manufacturing sector. For further
incentives two offices in Sabah and Sarawak. enquiries, please contact us at:
for industry development; and
T6: To guide and facilitate The main functions of MIDA are to: Malaysian Industrial Development
collaboration between industries • Undertake planning and co- Authority
(local and foreign). ordination of industrial development Block 4, Plaza Sentral, Jalan Stesen
Together with MIDA we are in Malaysia; Sentral 5, Kuala Lumpur Sentral,
working towards local manufacturing • Promote foreign and domestic 50470, Kuala Lumpur, Malaysia. Tel:
of PV products serving the global investments in the manufacturing (603) 2267 3633 Fax: (603) 2274 7970
market and establishing strong local and services sectors; E-mail: promotion@mida.gov.my
service providers competent to operate • Recommend policies and strategies MIDA with support from MBIPV is
business in the ASEAN region. Please on industrial development to the enhancing and attracting international
feel free to contact MBIPV team any Government; PV companies to establish
time. Contact: Mr Nazri • Evaluate applications for manu- manufacturing in Malaysia and enjoy
(Nazri@ptm.org.my) facturing licences and expatriate the numerous benefits and advantages.
posts; tax incentives for manu- First success story of local PV
The role of MIDA can be presented facturing activities, tourism, R&D, manufacturing exceeding 10 MW is
as follows: training institutions and software First Solar, a leading US company in
The Malaysian Industrial development; and duty exemption on thin film module production. First
Development Authority (MIDA), raw materials, components and Solar is establishing a 220 MW
incorporated as a statutory body under machinery; • See page 17

16 PV Industry Magazine August 07


Local and Global
Manufacturing
Opportunities in
Photovoltaics

• From page 16
production facility in Kulim High-
Tech Park, Malaysia. Currently the
production facilities are under
construction and production should
be operational in mid 2008. Other
local manufacturers in PV products
cover the production of garden lamps
(up to 50,000 pieces per month) and
street safety products for Middle East
countries. Malaysia has many
opportunities for local manufacturing
and such opportunities have yet to be
explored and understood by global PV Figure 2: Kulim High Tech Park, Malaysia.
companies. Today semi-conductor globally for venture capital and private been and is still talking about the
companies are well established, e.g. equity investment and investment in silicon bottleneck, which hindered the
in Penang, Shah Alam and Kulim, PV (21%) is the second largest after rapid expansion of the PV industry. The
and have benefited from the Biofuels with 34%. Considering these problem seems to be properly
conducive and profitable business and facts and estimating that around 60% addressed and more than 120,000
manufacturing environment in of the VC and PE money goes into tonnes of annual silicon production
Malaysia. PV companies with interest California and around 30% into the ‘PV capacities will be on-line from 2008
towards front-end manufacturing Valley’, more than US$180 million onwards, able to supply a demand of
have the potential of strong earnings (RM648 million) of VC and PE at least 10 GW annually. The industry
from the existing skilled labour and investment went into new companies is positive that the issue has been
established manufacturing and new technologies in the ‘PV Valley’ addressed and solutions are in place to
environment for silicon, wafer and in 2006 alone. resolve this bottleneck, and forecasts
cell production. PV is BIG business! Today many that the growth rate of PV will resume
Similar to the clustering of semi-con Industrial Development Agencies the escalation rate as before. But
companies in Malaysia, a growing responsible for Foreign Direct what’s next? Bottleneck on human
number of PV companies is Investment (FDI) are participating in capital? Yes, this is most likely! But
establishing manufacturing in Eastern exhibitions and are collaborating with some say, let’s harvest today – the
Germany, e.g. Thuringen, Berlin and respective country chambers of future is now and is definitely PV. But
Saxony. Today Eastern Germany has commerce to woo international PV we have to be cautious and should
attracted significant number of parties to the country. And exhibitions reconsider our main objectives ‘to bring
companies for local manufacturing, with focus on industry and products are the cost down’ and ‘serve the global
thanks to generous incentives from the mushrooming. Soon we will have a market, including also undeveloped
European Union and State section or day dedicated for investors countries’.
Government for production facility and to inform about local PV The focus shifted in the last 5
manpower. The cluster in Eastern manufacturing in respective countries. years towards the high-profit
Germany has already been renamed as Until now, this is not addressed and markets in Europe and the USA and
Solar Valley; since 1996 the Solar may become an important platform in the off-grid market is given less
Valley has created more than 20,000 the future. The race is on – everyone attention. Profit is high in grid-
jobs in tooling business (related to PV) has recognized the huge potential of PV connected markets with a feed-in-
and along the PV value chain. And in and revenues, especially the tariff (FiT) programme and every
2007 and 2008 alone, 15 new solar fabs manufacturing of PV products and industry player like to profit as fast
will be built, creating up to 10,000 new exporting the final products to the as and as much as possible. What if
jobs. booming markets. Countries not known policies change and markets become
Another cluster location for on the PV map so far, but known for less attractive?
growing PV manufacturing is Oregon, abundant solar sources, such as Hopefully there will be new FiT or
USA, with focus on silicon and cell Singapore, United Arab Emirates (with Renewable Portfolio Standard (RPS)
manufacturing because of low-cost Sharjah, Fujairah) and Mexico (Baja markets, but we have to keep our
hydro power, very stable power supply California) are wooing international objectives in focus and achieve PV
and highly skilled labour from existing PV companies and attracting an system cost of less than US$3/Wp
semi-conductor industry. Start-ups increasing number of them with (RM10.8/Wp) from 2010 onwards, as
with focus on 2nd and 3rd generation of attractive packages, including up to 50 once promoted to our politicians. The
PV cells concentrate in the Silicon years tax holiday (UAE), equity industry needs to cut back their high
Valley in California. The Silicon Valley participation (Singapore) and low-cost profit and reduce system cost to
is attracting the highest venture labour (Mexico). But for investors it is sustain a long-term development of
capital (VC) and private equity (PE) becoming increasingly difficult to the PV market in order to achieve
investment and investors have differentiate between all the offers, all grid-parity, and also to be able to
renamed the Silicon Valley to ‘PV of them appear to be an eye-catching supply the off-grid market in rural
Valley’. A recent report by the United bouquet of flowers but start to wither areas again.
Nations Environment Programme after few days. Adding to the difficulties The industry has to balance the
(UNEP) concludes that in 2006, US$4.9 are ‘consultants’, who act as middle- market development with the
billion (RM17.6 billion) VC and PE man trying to make their cut and use socioeconomic impacts; which is
investment were poured into new clean the opportunity to ride the ‘PV business somewhat a delicate balance between
energy companies and renewable wave’. serving ‘the have-not’, e.g. undeveloped
energy (RE) projects in the USA. The For the past two years and possibly countries and ‘the investors’ interest’,
US is the largest single destination inclusive of next year, the industry has e.g. FiT markets.

PV Industry Magazine August 07 17


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The PV Industry
Value Chain – An
International
Snapshot

The PV Industry Value


Chain – An International
Snapshot
The PV industry may be industry. There are many attempts to
subdivided into the following groups replace the current expensive
representing different steps in the purification process based on
PV value chain: producers of chemical gaseous purification by
upstream materials, ie feedstock, cheaper alternatives; however these
ingots, blocks/bricks and wafers; are not likely before 2008 at the
producers of semi-finished and earliest. In 2006 there continued to
finished PV products, ie PV cells be four major producers of solar grade
and modules; producers of balance- silicon: Wacker in Germany, REC
of-system components for PV Solar Grade Silicon and Hemlock
systems, ie charge regulators, Semiconductor Corporation in the
inverters, batteries, mounting USA, and Tokuyama in Japan.
structures and appliances. Between them, they produced about
The total value of business in 60% of the feedstock required by the
2006 amongst the International PV industry in 2006. The USA is a
By Greg Watt, Operating Energy Agency PV Power Systems large exporter at this level of the PV
Agent for IEA PVPS Task 1 Programme1 countries was industry value chain. It is reported
approximately 10 billion USD, that the selling price of solar grade
along the length of the value chain silicon increased by about 20% from
from feedstocks to PV system 2005 to 2006.
deployment. In parallel with the Ingots are of two types: single
business value of PV production and crystal and multicrystal. Ingot
markets, the economic value in the producers are in many cases also
IEA PVPS countries can be producers of wafers. European and
characterized by the total direct Japanese companies feature most
employment of about 70,000 people prominently in this section of the
across research, manufacturing, industry value chain. Some
development and installation. companies are vertically integrated,
To make single crystal silicon controlling the process from ingots
ingots, multicrystalline silicon ingots to cells and modules. The companies
or multicrystalline silicon ribbons, having their own feedstock or
the basic input material is highly having secured long term contracts
purified silicon. The process is the are those best able to grow. An
same as for producing semiconductor interesting trend is the decrease of
grade silicon. However, the producers wafer thickness, probably strongly
have simplified some steps in their motivated by the rising price of
processes for supplies to the PV • See page 23

PV Industry Magazine August 07 21


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The PV Industry
Value Chain – An
International
Snapshot

• From page 21 its lead, with the German producer 58 % respectively.


silicon feedstock, and an ongoing Q-Cells in second position, followed Some consistent themes emerged
focus on improving manufacturing by Kyocera, Sanyo Electric and during 2006: cell supply problems are
efficiency. Mitsubishi Electric. These five creating dire circumstances for many
2006 provided some interesting companies accounted for about 60% smaller, disaggregated module
cell and module growth stories in of total cells produced in 2006. In the producers; foreign product and price
individual countries and also at the United States, the third largest offers are able to strongly impact
global level. The total photovoltaic producing country, production of cells domestic markets; access to a
cell production volume for 2006 in the increased by 29% from 2005, while booming foreign market can provide
IEA PVPS countries was reported to module production remained flat. not only a lifeline but a goldmine for
be about 1,900MW, up from However, US output of thin-film the industries in some countries
1,500MW in 2005, or an increase of technologies saw another dramatic where the domestic market has
27%. In reality global growth is even production increase of 94%, on the collapsed; and East Asia is the
stronger since production is also back of a 109% increase the previous emerging powerhouse for PV cell and
increasing rapidly outside the area year. module production internationally.
covered by the reporting countries. In 2006 module production in Provided PV can retain the
Non-PVPS countries (particularly Europe clearly surpassed that of political favour it currently enjoys in
China, Taiwan, India, and the Japan for the first time. Crystalline a number of key markets for the next
Philippines) now possibly account for silicon technologies maintained their decade or so, continuing very high
over a quarter of global cell dominance, accounting for 91% of the market growth rates of 30-40% per
production and over 30% of global market. However, this percentage has annum seem assured. This presents
module production. Japan was the slipped three percentage points from a very attractive proposition for
leading producer of cells (920MW) the previous year. Interestingly, total investors of all kinds, as the
and modules (645MW) during 2006. 2006 module production only increasing spate of public listings for
Production of cells and modules in increased by about 9% over 2005 PV companies attests. The steady
this country accounted for 48% and production. The cell production march of the main manufacturing
39% respectively of the IEA PVPS capacity in the IEA PVPS countries, centres towards countries with lower
countries’ production, with Germany defined as the maximum output of a production costs – notably East and
in second place with 27% and 21% manufacturing facility, increased by South East Asia, but also central
of production respectively. The 29%, largely due to growth in Europe - seems inevitable. This will
relative German market share in Europe. Utilization of capacity was at accelerate PV’s convergence with the
2006 increased at the expense of the 69%. The increase in the module price of conventional electricity
Japanese market share. The production capacity and the supplies, provided quality control is
Japanese producer Sharp maintained utilization of capacity were 15% and not compromised.

PV Industry Magazine August 07 23


Latest PV
Business News

Latest PV Business News


Following the latest news on PV business from around the globe collected from various sources
such as www.solarbuzz.com or www.photon-international.com or
www.renewableenergyaccess.com or www.renewableenergymagazine.com. Please browse the
recommended indicated links to be informed about the latest development in the PV market.

EUROPE: European Photovoltaic Industry and engineers when fully operational.


Association estimates that the total SGX Sesdaq-listed Equation Corp
Bonn, Germany: SolarWorld plans installed capacity in 2010 could be Limited (“Equation”) through its newly-
manufacturing expansion to 1 superior to 300 MW if the right decisions acquired subsidiary Solar Morph Pte.
Gigawatt are taken. Portugal has not yet measured Ltd. (“SolarMorph”), a Singapore-
Against the backdrop of a booming export how developing a local market is registered company will undertake the
business, the SolarWorld Group is to synonym to creation of jobs, local construction and operation of the plant
build another integrated solar factory industry and reduction of CO2 emissions in Singapore, commencing with
(GigaFab) in Freiberg, thereby (potentially 300,000 tonnes in 2010) establishing a 20 MW manufacturing
increasing the capacity of wafer contributing therefore to Kyoto targets. line by mid-2008 and continue to expand
production in Saxony by 500 MW to 1.0 to its full 60 MW annual capacity by
Gigawatt. The doubling of the previous Phönix SonnenStrom AG renamed to 2010. Groundbreaking of the plant is
expansion target is due to the high Phoenix Solar scheduled to take place in fourth quarter
international demand for the silicon Phönix SonnenStrom AG, a leading of 2007. Production is scheduled to start
wafers of the SolarWorld AG subsidiary international photovoltaic systems in July 2008 and will be ramped up to
Deutsche Solar AG, one of the world integrator is to be renamed as Phoenix full capacity by early 2009. SolarMorph
leaders in the production of the super- Solar AG. Upon changing the company has already secured a three-year off-take
thin silicon wafers. name to “Phoenix Solar”, the Group, agreement worth US$120 million
which is positioned in the international (RM430 million).
Pfäffikon, Switzerland: New thin film arena, will bear the same name in all
process developed by Oerlikon Solar countries. Phoenix Solar is established Seoul, South Korea: Dongyang
Oerlikon Solar, a Swiss solar company, in Singapore with a regional office and Holding commissions SunTechnics to
has been able to develop a transparent services also the Malaysian market. construct 20 MWp PV system
conductive oxide process, which will be Before the year is over, the largest
used in a new production plant. Oerlikon New process to speed up solar PV photovoltaic plant in Asia will be
Solar is so far the only company to offer module assembly constructed in SinAn, southwest of the
this technology, known as TCO process, Société d’Energie Solaire (SES), a Swiss Korean capital Seoul. The leading
integrated in the thin film production company, has just patented a new system construction company in Korea,
process. Oerlikon Solar will open a new that promises to offer numerous Dongyang Engineering & Construction
plant in Germany focusing on this new advantages through material savings Corporation of Seoul, commissioned the
technology, using low-cost, and automation. In the new SES process, German company SunTechnics, a
environmentally friendly zinc oxide the strings, instead of being soldered to subsidiary of Conergy AG with the
instead of the commonly used fluoride the peripheral end-ribbon, are folded over planning and implementation of the ¤90
doped tin oxide. “This customer activity the back of the cells, where they are million (RM425 million) solar power
further solidifies our leadership position soldered with a simple machine onto a plant. The sun-tracking photovoltaic
over our competitors in the marketplace,” flexible circuit. The circuit substrate is a system, with a total maximum output of
said Mr Uwe Kruger, CEO of Oerlikon. DuPont™ Tedlar® PVF film laminated 19.6 MWp, is the size of some 80 football
with DuPont Teijin Films™ Mylar® PET fields (600,000 m≤), and will produce
Portugal: Solar sector waits for polyester film; the circuit has special annually more than 27,000 MWh of
Government signal contacts for attachment to the junction environmentally-friendly electricity from
Portugal is the sunniest country of box and also serves to insulate the strings the sun in the future. This will
Europe but remains amongst the last from the cells. After lamination, a special correspond to the annual power
ones in developing solar photovoltaic junction box, made by Huber & Suhner, consumption of more than 6,000
electricity. If adequate steps to revise the is simply placed over the circuit and the households.
current framework to support the connections are soldered.
development of photovoltaic electricity Japan: New solar cell performance
are taken, the potential to develop this record by Mitsubishi
clean source of energy is huge. The ASIA: Mitsubishi Electric has achieved an
Government has limited to 150 MW the impressive performance of 18% for a
capacity to be installed by 2010. The Thin film manufacturing plant planned polycrystalline cell. The unit has an area
for Singapore 150 mm2 and has recorded a performance
Singapore is set to launch its first solar 1.2% higher than the previous record.
panel manufacturing plant using Thin- The new technology will be presented in
Film Amorphous Silicon Technology in a solar fair at Fukuoka coming
the fourth quarter of this year – making December. Such a high performance has
it the first country in this region to been achieved thanks to a low-reflection
operate one. The 10,000 m 2 plant, texturized area and a process that prints
utilising a fully automated the electrodes on the silicon, thus
manufacturing process with a final reducing shadow areas.
annual capacity of 60 MW, is expected to The new technology will be used as
employ 200 high-tech skilled operators • See page 26

PV Industry Magazine August 07 25


Latest PV
Business News

• From page 25 expansion of PV industry. China has in the first four months of the year
ambitious plans towards developing the through the Canadian province’s new
from the end of 2007. Mitsubishi will then renewable energy sources, however, coal is Renewable Energy Standard Offer
achieve the highest performance level in expected to remain the principal source of Contract Program. The program officially
the industry, which will increase the energy in near-term. went live late last year but did not
electricity production of its clients, execute its first contracts until 2007. It
commented the Japanese firm. offers PV projects the highest price for
AMERICA: renewable energy fed into the Ontario
First Solar expands manufacturing in grid at a non-declining 42¢ CAD
Malaysia Tucson, USA: SOLON to start module (RM1.38) per kWh over 20 years. So far,
First Solar announced that its board of manufacturing towards End of 2007 the program has attracted mostly large-
directors has approved the construction SOLON AG, one of Europe’s largest scale projects, including a 9.12 MW
of an additional manufacturing plant in manufacturers of solar energy systems has project to be installed southwest of
Malaysia with an annual production opened a new subsidiary in Tucson, Toronto by large US-based project
nameplate rating of 120 MW, Arizona. SOLON will commence module developer and installer SunEdison LLC
representing an investment of manufacturing operations in Tucson (US) and Canadian joint-venture partner
approximately US$150 million (RM510 in late 2007. The company will produce high SkyPower Corp. This is the first of
million). The additional production efficiency solar modules, and provide solar several joint projects being pursued by
capacity of the new plant is scheduled to integrated design and installation services the two companies that has been
come on line in the first half of 2009. to large-scale commercial, municipal and approved by the OPA, which caps the size
utility customers throughout the United of any given project at 10 MW. The
Kazakhstan drafts Renewable Energy States. companies have said they intend to build
legislation at least 50 MW by 2009.
Kazakhstan could become the next General Electric, USA: The quest to
country to pass legislation supporting the develop low cost solar PV technology USA: Nearly 90% of Americans think
development of renewable energy after GE Global Research Center recently was solar should be new home option
Government ministries declared support awarded a three year, US$46.7 million According to a recent Roper survey
for the development of draft legislation (RM160 million) program from the commissioned by Sharp Electronics
regulating this new industry. Ambitions Department of Energy to develop low-cost Corporation, nearly 90 percent of
for RE in Kazakhstan remain fairly solar PV technology. This new program was Americans think that solar electricity
modest, the power sector modelling granted through the “Solar America should be an option for all new home
carried by UNDP shows that 1,000 MW Initiative”, which is a part of President construction, up significantly from one
of small scale hydro power and 2,000 MW Bush’s Advanced Energy Initiative. The year ago (79 percent). Three-quarters of
of wind power can be constructed by goals of this project are to decrease the cost survey respondents perceive solar power
2024. Nevertheless, the significance of of manufacturing and distributing solar to be more important than ever, the
this is immense in a country whose energy to ultimately report says. The survey was conducted
economy is so linked to the hydrocarbon bring the cost of solar in May 2007 among 1,004 adults to
markets. As a consequence Kazakhstan energy to parity with measure their perceptions of solar power.
is the largest per capita emitter of the grid. GE will be “More and more, consumers are
greenhouse gases in Central Asia. looking at three interested in solar energy, as the results
d i f f e r e n t of this survey clearly show. The message
PV industry in China confronts huge technologies for the from consumers to homebuilders is
potential risk solar cell: high clear—builders can differentiate
Production of solar cells in China has efficiency silicon- themselves while satisfying customer
shown an impressive growth over the last based cells, moulded needs by offering solar electricity on any
few years. But the PV market overseas silicon wafers, and home they build,” said Ron Kenedi, vice
remains unsatisfactory in contrast to the flexible thin films. president, Solar Energy Solutions Group,
vigorous expansion Sharp Electronics Corporation.
of production Santa Clarita, USA: BioSolar builds bio-
capacity. Currently, based prototype solar cell USA: Lockheed Martin solar arrays to
German market – BioSolar™ Inc., developer of a be launched to space station
that’s the world’s breakthrough technology to produce thin The third of four pairs of massive solar
largest consumer of film, flexible solar cells on bio-based plastic arrays and a second Solar Alpha Rotary
solar cells – and substrates announced that the company Joint (SARJ), built by Lockheed Martin
other overseas has achieved another milestone in its at its Space Systems facility in
markets are previously announced development Sunnyvale, Calif., was launched aboard
growing slowly. As program to create the world’s first bio-based the space shuttle Atlantis to the
over 94% of the solar cell. BioSolar’s bio-based proprietary International Space Station (ISS) in
China’s solar cell films can withstand the environment of the June, 2007. The Space Systems ISS solar
products are photovoltaic lamination oven, and working arrays are the largest deployable space
exported, this slow solar cells can be made using BioSolar’s bio- structure ever built and are by far, the
rate of growth in foreign lands comes as based film as part of the packaging for most powerful electricity-producing
important reason why Chinese PV industry crystalline silicon-based PV modules as arrays ever put into orbit. The eight array
is at risk. Unlike developed countries, no well. The three fully functional prototype wings were designed and built under a
specific subsidy policy is provided by China solar cell modules using BioSolar’s US$450 million (RM1,550 million)
for its PV industry. It is still far behind the proprietary bio-based backsheets contract from the Boeing-Rocketdyne
developed countries, for example Japan and performed to the cell specifications. Division in Canoga Park, Calif., for
Germany, in both scientific research system delivery to the Boeing Company and
and infrastructure. Therefore, the Chinese Canada: Ontario inks over 50 MW of NASA. When fully deployed in space, the
govt. should offer incentives and subsidies PV projects in first four months active area of the eight wings, each 107
for solar energy-based electricity generation The Ontario Power Authority (OPA) by 38-feet, will encompass an area of
since this will encourage demand in reports that it has approved 27 contracts 32,528 square feet, and will provide
domestic PV market and also ensure the for over 50 MW of PV generating capacity power to the ISS for 15 years.

26 PV Industry Magazine August 07


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Always a sunbeam ahead
Market Movers
of Solar
Photovoltaics
in Malaysia

Market Movers of Solar


Photovoltaics in Malaysia
call was coy; at only
Graph on Result of 1st Bid for SURIA 1000 40kWp, it served to flirt
with the market. At the
closing of the first call,
the market reacted with
a positive signal; there
By Wei-nee Chen were 39 applicants with
When Nik Fadzrina Hussain received a total of 155kWp,
a call from her PV service provider, she almost four times the
couldn’t believe she is one of the target PV capacity.
successful bidders for the first call for The first call for
SURIA 1000 programme. Nik Fadzrina SURIA 1000 puts a cap
and her husband have been planning of 75% on the maximum
to build a new home in the State of rebate offered by the
Pahang and the key feature of their programme. The
dream home is being environmentally average rebate for the
friendly. Today, the lucky couple is first batch of recipients
among one of the 14 recipients for the is 53% and this
first call for SURIA 1000 programme. highlighted the
willingness of the public
What is SURIA 1000? to pay in order to secure
SURIA 1000 is a national programme their bid. The bidders’
initiated under the 9th Malaysia Plan contribution was
to encourage solar building integrated forecasted at a total of
PV market to grow. The programme is RM300,000; the actual
similar to the Japanese Sunshine amount contributed by
Programme and the German’s Rooftop the bidders amounted to
Programme. It offers attractive capital RM800,000.
incentive to those interested in As a result of the
installing solar BIPV and the lower financial
programme is for both residential and contribution requested
commercial properties. by the successful
However, unlike the Japanese and bidders, the total PV
German’s programmes, the SURIA capacity being awarded
1000 is based on bidding process in is increased from 40kWp
which the bidders compete among each to 58kWp.
other for the financial incentive. The Does investment in
selection of recipients is based on least solar PV makes any
amount of financial contribution sense? Apparently so;
requested by the bidders from the 65% of the successful
SURIA 1000 programme. introduced to the public on 26 th recipients operate their own business
November 2006 by the Minister of and the idea of being able to hedge
The First Call for SURIA 1000 Energy, Dato’ Sri Dr Lim Keng Yaik. against imminent future electricity
The first call for SURIA 1000 was The PV capacity reserved for the first tariff hike makes more sense out of the
dollar invested.
For detailed analysis of the first call
Bidding Schedule for SURIA 1000 for SURIA 1000, please visit http://
www.ptm.org.my/bipv/S1.html
Call for Bidding Maximum Capacity Available Maximum Bidding
for bidding (kWp) Discount (%)
The Second Call for SURIA 1000
SURIA 1000 programme was officially
1st Dec 2006 – 1st Apr 2007 40 (residential only) 75 launched on 22nd June 2007. The event
was officiated by the Minister in the
1st Jun 2007 – 1st Oct 2007 60 (residential only) 70
Prime Minister’s Department, Dato Sri
3rd Dec 2007 – 1st Apr 2008 80 60 Mohd Effendi Norwawi on behalf of the
2nd Jun 2008 – 1st Oct 2008 120 55 Prime Minister of Malaysia.
1st Dec 2008 – 1st Apr 2009 140 50 In the Prime Minister’s speech,
which was delivered by Dato Sri
1st Jun 2009 – 1st Oct 2009 160 45 Effendi, the Prime Minister pledged the
1st Dec 2009 – 1st Apr 2010 180 40 Government’s support and
• See page 29

28 PV Industry Magazine August 07


Market Movers
of Solar
Photovoltaics
in Malaysia

• From page 28
commitment towards solar BIPV as one
of the renewable energy strategy
outlined for energy security and
climate change mitigation efforts by
Malaysia.
The Prime Minister, Dato’ Seri
Abdullah Ahmad Badawi shared
passionately with his people, his vision
he coined “Wawasan SURIA” in which
he aimed to replicate what he saw in
his recent trip to Osaka, Japan.
According to Dato’ Seri Abdullah, he
saw solar PV systems aesthetically
integrated with both residential and
commercial buildings and generating
clean electricity at the same time. A
sight which was rapidly transformed to
a vision for a nation blessed with
abundant and consistent sunlight.
The second call for SURIA 1000 is
only for residential with a target PV
capacity of 60kWp and maximum
rebate of 70% to the bidders. All
applications for SURIA 1000 must go
through the listed PV Service Providers property development projects BIPV systems installed by the year
( h t t p : / / w w w. p t m . o r g . m y / b i p v / • Can either be landed or non-landed 2010. Although the market for solar
APVPS.html) which act as a 1-stop properties. BIPV is largely in embryonic stage, the
BIPV centre for the bidders. • Maximum of two (2) property MBIPV Project focuses on developing
Commercial bidders would be able to developers will be selected, subject to soft infrastructure to sustain BIPV
bid from the third call for SURIA 1000 targeted BIPV capacity. growth in the country. SURIA 1000 is
which will be from 3rd December 2007 • Interested housing developers (or the forerunner of bigger things to come.
to 1st April 2008. architects/contractors) can submit But first it must succeed.
the application (form, guidelines,
SURIA for Developers T&C will be available from 16th July
Recognizing the influential role of 2007) that includes: If at first you do not succeed,
property developers in changing the • Profile of the developer. you try again..
lifestyle of the people, the Prime • Development concept, including Tunku Ahmad Burhanudin is among
Minister Dato’ Seri Abdullah masterplan indicating the allocated the 25 bidders who did not succeed in
announced a special financial incentive parcel for SURIA development, securing the bid for the first call for
programme only for the property approved planning permission, SURIA 1000. According to Tunku
developers. converted land title. Ahmad, “I understand why I did not
The “SURIA for Developers” is a • Architectural drawings and concept succeed; I need to be more competitive
special one-time programme which is of solar BIPV (compulsory), and with my bidding. My request for
part of the SURIA 1000. The objective passive or active energy and water financial contribution from the
of the programme is to promote the efficiency features (optional). Government is too high”. In fact,
development of sustainable solar BIPV • Indicative cost of solar BIPV system. Tunku Ahmad has pledged that he
housing in Malaysia. • Solar BIPV capacity for each unit of will not give up bidding for each call
SURIA for Developers will provide house must be minimum 4kWp and until he finally succeeds in securing
financial incentive of 3 million maximum of 10kWp, subject to a his share for electricity generated
Ringgit Malaysia for a target PV minimum total of 100kWp per from the sun.
capacity of 340kWp. With the development. For more information on SURIA
installation of solar BIPV in their • For landed property, each house in 1000, please visit http://
project development, the property the allocated parcel shall incorporate www.ptm.org.my/bipv/suria.htm or
developers can finally declare their solar BIPV feature. email to suria1000@ptm.org.my
homes as ‘truly sustainable’ with • For non-landed property, solar BIPV SURIA 1000 programme is
electricity generated from a source feature shall be incorporated as the administered by the Malaysia Building
which is guaranteed to be free and prominent feature covering a total Integrated Photovoltaic (MBIPV)
contributing to the betterment of the area of 750m 2 (crystalline solar Project. The Project is implemented by
environment. BIPV) or 1500m 2 (thin-film solar Pusat Tenaga Malaysia for the Ministry
The call for developers will be from BIPV). of Energy, Malaysia with further
16th July 2007 until 1st January 2008. • Letter of commitment to invest and financial support from Global
Property developers can expect free construct the SURIA homes, with a Environment Facility disbursed via
technical consultancy and market- target to complete and provide United Nations Development
ing support from the MBIPV team. vacant possession by year 2011. Programme. The MBIPV Project
The total grid-connected BIPV objective is to reduce the long-term cost
Property Developers: How do I systems in Malaysia stand at 578kWp. of BIPV technology by creating a
participate? The objective of SURIA 1000 is to see sustainable and widespread BIPV
• Eligible for new, on-going, or existing at least 1200kWp of grid-connected market.

PV Industry Magazine August 07 29


Suria 1000
and SfD

Sustainable Development

19th September 2007


Kuala Lumpur Convention Centre (KLCC)
Malaysia
www.roofandfacade.com/forum.html

Hosted by: TECHNOLOGY COMMUNICATIONS PTE LTD

Supporting Media :

In conjunction with MALBEX 2007


& INTERNATIONAL CONSTRUCTION CONFERENCE 2007
Overview
of Japan’s
PV Industry

Overview of Japan’s PV
Industry
PV manufacturers in Japan by manufacturers of raw material and
By Izumi Kaizuka, Currently, 10 companies are manu- component for PV,
Manager facturing PV cell/ module manufacturers 4) Formulation of the sales channel of
in Japan; Sharp, Kyocera, Sanyo Electric, residential PV system.
RTS Corporation These movements will contribute to
Mitsubishi Electric, Kaneka, Mitsubishi
Heavy Industries (MHI), Hitachi, Fuji the establishment of the supply
Electric Systems, Honda Motor and framework. In the domestic PV system
FujiPream/ CleanVenture 21 (CV21). market, product development of PV
Production volume of PV cell/ Among them, latecomers manufacture system for public, industrial and
module in Japan differential PV products. Hitachi started commercial use as well as residential use
2006 production volume of solar cells and manufacturing bifacial silicon solar cell will be advanced. Moreover,
PV modules in Japan increased for 10 from 2003. demonstrative research of MW-scale PV
consecutive years, and recorded 927.5 FujiPream and Clean Venture 21 system will be advanced, aiming at power
MW, which is an 11% increase from the jointly produce spherical Si PV module. supply. Users of PV system including
previous year. While Japan has been the Fuji Electric Systems completed a 15- individuals, private companies and local
largest PV production country in the MW/year plant in Kumamoto Prefecture governments will understand the
world since 1999, and the share of Japan and manufactures flexible amorphous Si significance of achieving the targets of
in the worldwide PV production has been module. Kyoto Protocol and are becoming more
decreasing in recent years due to Honda established “Honda Soltec”, a willing to introduce the PV system.
globalization of solar cell/module subsidiary for manufacturing, in It is expected that the PV industry in
production and increase of production Kumamoto Prefecture to produce CIGS Japan will establish collaborative and
volume in all over the world. PV module. Showa Shell Sekiyu also cooperative framework with other
completed a 20-MW/year ministries (besides METI) and agencies,
plant for CIGS solar cell in local governments, related industries as
Miyazaki Prefecture well as users; in conjunction with
aiming at starting national energy strategies and enhance
operation in 2007. the efforts to achieve full-scale
Production Volume (MW)

dissemination of PV system.
Towards self- Examples of PV systems in Japan

sustainable PV
market
Expansion of PV system
introduction in Japan
aiming at self-sustainable
PV market will be
advanced by the measures
Trends of production volume of PV cell/module by manufacturer. taken by the government
Source: PV News, March 2007, partly modified by RTS Corporation
and the efforts of the PV
industry. Framework of
dissemination measures are promoted by
the Ministry of Economy, Trade and
Industry (METI) and the Ministry of the
Environment (MoE). Following METI
that has been leading Japan’s PV policy,
the MoE launched several measures to
introduce PV system to achieve Kyoto
Protocol.
In the supply framework of PV cell/
Hitachi Bifacial solar cell module, the PV industrial structure will
be enhanced and expanded over the
whole value chain in several aspects as
well as increase of production capacity
by PV manufacturers. The mechanism
to achieve this are:
1) New entry of thin-film PV
manufacturers previously described,
2) New entry of raw material
manufacturers into production of
Flexible PV module from Fuji Electric silicon feedstock for PV,
Systems 3) Enhancement of production capacity

PV Industry Magazine August 07 31


2006 Developments and Prospects on the Global PV Industry
An industry report by Pegasus Business and Market
Advisory in collaboration with Pusat Tenaga
Malaysia (Malaysia Energy Centre)
Contents of the report:
World economy and energy overview including
fossil fuels and electricity generation….
Description of the PV value chain including
industry trends and outlook….
Developments, industry and market trends in
Germany, Japan, United States, China, Taiwan,
Spain and South Korea….
Description of major companies in the PV value
chain including module, cells, polysilicon, thin film
and inverter manufacturers….
Short case studies on China’s Suntech and Yingli
Solar….
Report serves a useful tool for decision makers
already involved, venturing or considering to enter
the PV industry and market. Body of the report is
130 pages accompanied by charts, diagrams and
tables.

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Global PV
Industry
Development
Since 15 Years

Global PV Industry
Development since 15 years
important feedback that crystalline PV is closing rapidly and PV is already
By Daniel Ruoss, technology is well understood and competitive in peak power pricing. In
International Consultant mature. The photos (figure 1 and 2) a few years grid-parity will be achieved
MBIPV were taken in 2004 and both PV in urban centres of Japan and also in
components are still operational today. some parts of the USA. Grid parity is
These first market implementations when cost for electricity generated by
were critical as their successes lead to PV system matches the conventional
1992: Bill Clinton is elected as 42nd increased confidence for the policy electricity cost can be achieved when
president of the USA - Former stakeholders to design and implement cost for PV system decline and
Czechoslovakia voted to split the sustainable PV programmes to conventional electricity prices are
country into the Czech Republic and widespread PV technology. reflecting true cost.
Slovakia - Pope John Paul II issued an Compared to 1992 the global
apology, and lifted the edict of the 2007: The PV market has finally taken market experienced module cost
Inquisition against Galileo Galilei - off and is booming. Driven by reduction of 30% (1992: US$5/Wp /
And the Photovoltaic industry was committed and long term policy 2007: US$3.4/W and 1992: RM18/Wp /
cracking 100 MWp cumulative programmes implemented in Germany, 2007: RM12.2/Wp) and an increase of
installed power capacity. In 1992, the Spain, USA, Italy, France and Korea efficiency of 150% (1992: 12% / 2007:
annual revenue from doing business in the annual revenues End of 2007 will 18%) for mono-crystalline PV cells. The
the PV sector was between US$0.2-0.3 exceed US$14 billion (RM50 billion), industry is developing fast to achieve
billion (RM0.7-1.0 billion – applying resulting in a growth factor of 50 to 60- module prices of less than US$1/Wp
today’s exchange rate RM3.6 for US$1). fold compared to 1992. The biggest (RM3.6/Wp). From time to time the
The United States of America was annual market – for the fourth time in industry experienced some hiccups but
dominating the global market in terms a row – will be Germany with an they have reacted fast towards
of cumulative installed PV capacity annual installed PV capacity exceeding increasing production capacities and
(~45 MWp) and product 1.6 GW (End of 2007). The United cost reduction. In 1988-1990 and then
manufacturing, e.g. Siemens (formerly States of America secured their once again 2005-2007, supply shortages of
ARCO Solar), Mobil Solar and AMOCO/ top spot in the PV ranking (annual crystalline silicon wafer scraps led to
ENRON Solar (with Solarex as installed capacity) and become the No.2 briefly higher prices of PV modules.
business unit). In 1992, the PV module market worldwide overtaking the After 2008-2009, it is predicted that
price dropped for the first time to below Japanese (End of 2007). In Japan the prices will decrease, owing to additional
US$5/Wp (RM18/Wp) and system policy changed few years ago and solar-grade silicon capacity coming on-
prices were around US$12-15/Wp Government subsidy programme for line and new technologies to use metal-
(RM43-54/Wp). residential PV application had grade silicon feedstock for acceptable
Products installed in the first concluded. This resulted in PV cell efficiencies. But prices for modules
markets (USA, Switzerland, Japan and becoming less attractive due to the still will not resume back to normal price
Germany) are performing as higher cost of generating electricity for reduction trend, because today’s
manufacturers had forecasted, PV compared to conventional policies implemented support higher
guaranteed and in turn, provided electricity. But in Japan this price gap sales prices for modules and benefiting
high profit and growth along
the value chain.
But what can be said
about long-term forecasts?
When will production cost for
PV module be below the
US$1/Wp mark? Today the
race is on to be the first
company to promote products
which will achieve grid
parity. The estimated PV
system cost should be around
US$3/Wp (RM10.8/Wp) –
with module prices close to
US$1/Wp – to achieve grid
parity in markets such as
Japan, USA, and partly
Europe. There is enormous
potential for further PV cost
reduction through
technological innovation and
economies of scale. This
Learning curve for production cost of PV modules (Source: United Nations University Press, modified by Daniel Ruoss)
• See page 34

PV Industry Magazine August 07 33


Global PV
Industry
Development
Since 15 Years

• From page 33 aggressively to get a market


situation is depicted in the ‘PV learning share. Even a 1% market share
curve’ shown in figure 3, which will result in revenue of
presents the module production cost approximately US$140 million
estimated in 1994. For crystalline (RM500 million) in 2007. Many
technology the PV learning curve is companies worldwide have
well on track and according to recognized the huge and fast Latest successful IPO by Sunergy
predictions. Thin film technologies are growing business in
expected to achieve faster cost Photovoltaics and have considered the business by number of IPOs and
reduction but due to a demand diversifying their businesses to PV. In market capitalization. In fact one could
outstripping the supply in the past, the the balance of systems (BOS), the almost conclude in order to have a
prices are kept high and modules are development of inverters is worth successful IPO, the company must be
sold only slightly below (around commenting. In 1992; the drive was vertically integrated or front end
US$0.4-0.8/Wp, RM1.5-2.9/Wp) the towards string inverters and first manufacturing and from China.
prices for crystalline modules. design of transformerless inverters As highlighted first generation PV
Thin film is expected to be the first were presented at international cell, crystalline technology, will
to achieve production cost at US$1/Wp conferences. The reaction was strong; dominate the market for the next ten
– as per figure 3 when market reaches transformerless inverters were labelled years, but the second generation, thin
10 GW; some companies claim to as a ‘danger for human safety’ and film technology, is upscaling their
achieve the benchmark already. But the ‘deadly piece of electronic chunk’. In production output fast to reduce
crystalline technologies still have room 2007 the market share (in MW) of production cost of solar modules. But
for improvements and will continue to transformerless inverters is at least as depicted in figure 3, thin film
dominate the market in the next five 30% and increasing. The advantages of production cost was expected to achieve
to ten years. Today c-Si technology has transformerless inverters have been the US$1/Wp (RM3.6/Wp) level with a
a market share of 94% and achieves cell fully recognized and the products are market of around 7 GWp cumulative
efficiency of 18% to 20%, and this is two complying with international safety PV capacity installed but so far has not
to three times the efficiency of thin- standards and not posing any harm to achieved the target. Even with several
film. Improvements can be made on the installer and end-user. hundreds of Megawatt new production
increasing manufacturing speed or Development on inverters has reached announced and thin film technologies
higher efficiency or increasing the a peak and a new product is introduced being the darling of investors and new
production yield, e.g. towards Gigawatt to the market almost every four weeks. start-up companies, we have to
production facility. In 1992, the No.1 Existing inverter manufacturers are consider the time and the difficulties,
PV module manufacturer (Siemens, aggressively defending their market especially with large area glass
USA) had an annual production output share or increasing their market share. substrates, to upscale the production
of ~10 MW/year. 15 years later, the No. New multinational enterprises are process into full operation (e.g. up to
1 PV module manufacturer (Sharp, entering this business to secure part 100 MW). And the focus is already
Japan) has an annual output of close of the PV cake or at least the icing. shifting towards third generation solar
to 600 MW/year; 60 times higher than Competition is fierce but end-users are cells, such as of organic or
15 years ago, which means the all smiles as they get the cost reduction nanostructure substance. All these
production output doubles passed on. Inverter cost reduced activities will finally drive the cost
approximately every 2.5 years. around 60% from 1992 to 2007 (1992: down and contribute to the widespread
Following this manufacturing US$2/W AC = RM7.2/W AC and 2007: use of PV in today’s life.
upscaling process, we can expect to see US$0.7/WAC = RM2.5/WAC) and further 15 years into the future; i.e. 2007
the first 1,000 MW (1 Gigawatt) cost reductions are expected. to 2022, PV has reached grid-parity
production facilities from 2010 Photovoltaic in 2007 has certainly in most of Europe, Japan and the
onwards. This is certainly one of the caught the eye of the industry and also United States of America and is a
approaches to bring the cost down – via the finance sector. The market in 2005 mainstream product for power
economics of scale – another is to have to 2007 is in upheaval and does not production and as building element.
innovative manufacturing techniques, follow the PV value chain as it used to Major power utilities have invested
e.g high-efficiency back-contact cell by do. Today investors deal with engineers over the last 10 years (2010 onwards)
Sunpower (figure 4) or PV modules and go from silicon into power production by
where the strings of the cells are manufacturing to module PV to meet their
interconnected by folding over the back manufacturers to get a exponential growing
of the cells and soldered with a simple fast profit. Long-term energy demand. The
machine onto a flexible circuit. The planning becomes difficult power structure is finally
circuit substrate has special contacts and quality is often of shifting from the more
for attachment to the junction box and lesser priority. In the last than 100 year old
also serves to insulate the strings from 15 years, we saw more centralized grid structure
the cells. than 50 IPOs from PV Organic solar cell by towards decentralized and
An identical impressive growth was companies only, Plextronics the market is
experienced for other PV products and generating a market internationally liberalized
manufacturing equipment. In 1992; the capitalization of > US$50 billion (> to allow IPPs to negotiate their feed-in
annual market was only 20 MWp per RM180 billion) and venture capital tariff independently. Market growth is
year and equipment manufacturer did (VC) investment in start-ups and finally not depending on policy
not consider the market at all. In 2007; innovative approaches exceeded programmes anymore but only on the
any major company from the tooling US$280 million (RM1 billion) in the industry to sustain and growth factor
business promotes his product range last 4 years. Companies in the USA is substantial resulting again to
and the possibility to modify easily to attracted the largest share of risk almost 60-fold, as it did the last 15
PV manufacturing and is competing capital, and Chinese companies lead years from 1992 to 2007.

34 PV Industry Magazine August 07