photovoltaics

Polysilicon – the raw material an entire industry depends on. Photo: Wacker Chemie Solar : the new “black gold” When will silicon shortages relax? Established manufacturers are expanding their capacities. New companies are increasingly launching production of silicon and wafers. Headmost: Chinese players. But is this enough?

fter the broad overview on cell and module could break up towards 2009 and 2010. “We believe manufacturers in the issue 4/2008, SUN & that the really serious projects will more or less elimi- WIND ENERGY now turns towards the down- nate the silicon shortages. However, an excess of capac- stream products. S&WE surveyed the silicon ities will likely not arise. Market researchers are forecast- industry on the worldwide production sites ing that the worldwide silicon production will reach Aand capacities for 2007 and 2008. In total, a number of 100,000 tons in 2010 and we think that this volume will 29 companies participated in the survey that are either definitely sell”, said Raymund Sonnenschein, CEO of already producing silicon or will launch production be- Joint Solar Silicon, Germany. fore the end of the year. Another 10 companies indicat- ed to launch production after 2009. Major players expanding capacities With the boom of the PV sector, even the chip indus- try’s silicon “waste” that is still useful for pro- Today, the four largest manufacturers are looking on in- duction fails to meet the demands. In consequence, so- creases of their capacities. U.S.-American Hemlock in lar silicon demand and supply have been dispersing. 2007 and 2008 almost redoubled its capacities from Accordingly, a sellers market has emerged in the last 10,000 to 19,000 tons and is planning an expansion years where manufacturers of downstream products to 27.500 tons until 2010. At Norwegian REC Silicon, were well-advised to enter long-term supply contracts. capacities in the range of 13,500 tons will be added in But in some corners of the sector confidence has mean- Moses Lake (Washington) and Butte (Montana) until while arisen that the bottlenecks in the silicon supply 2009. According to the company, more capacities will

114 Sun & Wind Energy 5/2008 follow before the current expansion period ends. In the Canadian Bécancour, there will be a brand new silicon factory launched. Although the size has so far not been determined, the plant will be of similar dimensions as the production site in Moses Lake, the company in- formed. Expansion has also been an issue for Wacker Chemie from Germany that currently produces a capac- ity of 10,000 tons. Until 2010, Wacker will redouble its capacities to more than 22,000 tons. More defensive expansion plans are held among the established Asian manufacturers. Japanese Tokuyama began expansion of the Higashi plant in the Yamaguchi prefecture in 2007 and plans to go from 5.200 tons to 8.200 tons until the beginning of 2009.

High silicon prices attract Asian companies High prices and profit margins have also attracted new companies that are now trying to enter the silicon pro- duction sector. Most of these newcomers come from Asia. “Nearly 60 Chinese enterprises have meanwhile in- vested in polysilicon products and announced that the Ready for production. output would not fall below 300,000 tons per year after Photo: Evergreen Solar expansion”, said Hu Yuncheng, Superintendent of Emei silicon: Supply, Demand & Implications for the PV In- ­ Material Institution. Although silicon dustry” by the U.S.-based Prometheus Institute for Sus- production asks for a lot of expertise, it has only taken tainable Development, the Russian company Nitol two or three years of planning for several new compet- would need more investors for expansion of the 3,600 itors to enter the market and to be able to launch their tons factory. Others fail for reasons of technical imple- production until the end of the year. mentation. “There are dozens of companies that speak It is interesting to note that most of these new com- of progress. We believe that few of them will ultimately panies rely on the prevalent and mature Siemens pro­ succeed in mastering the technological and financial cess. “This technology is used in 75 % of the worldwide challenges”, said Travis Bradford of Prometheus Institute installed capacities”, explained Peter Fath, Chief Tech- who is responsible for the study. nology Officer at the German engineering company Interesting has been the question of how an expan- Solmic, on occasion of the 5th Solar Silicon Conference sion of the capacities will in mid-term affect silicon pric- in the Chinese Shenzhen. One such example is the wa- es. That rarity of goods ultimately leads to higher prices fer manufacturer LDK Solar that has expanded the busi- is a principle that applies as much to the silicon market ness area on the downstream silicon production stage as to any other markets. In the last years, the price for and is currently building a factory in the Chinese Xinyu silicon on the spot market has seen high increases. But in the province of Jiangxi. Before 2008, a capacity of prices have soared also for long-term supply contracts. 6,000 tons will be reached. Xiaofeng Peng, Managing While the first capacities have already been added and Director at LDK expects that a range of 100 to 350 tons more factories have begun to launch production, a of silicon is already realistic for this year. In total, the price decrease for silicon seems not to exist. One reason production capacity will after completion range at for this could be that far from all of the planned capac- 15,000 tons per year. This would enable the company to ities have gone on stream. Expansion is also an issue for enter the ranks of the world leaders of silicon produc- the downstream products of the value added chain tion such as Hemlock, Wacker and REC Silicon. Another such as ingot, cell and module production, which means newcomer is DC Chemical that has in March completed that the rising silicon production is accompanied by an a manufacturing in Gunsan, South Korea, with an annu- even stronger demand. Still, chances are that the mar- al capacity of 5,000 tons and already plans an expan- ket might relax. According to the Silicon Price Index that sion of up to three times the current volume in the next was published by U.S.-American market researcher New year. But also PV Crystalox that is today known as ingot Energy Finance in August this year, the silicon prices and wafer manufacturer has decided to enter the sili- might drastically fall in the next year. As expected, the con production. Next to the wafer production in Erfurt, average silicon prices for forward contracts might de- Germany, a factory with an annual silicon capacity of crease by 43 %. In the opinion of New Energy Finance, 900 tons will go on stream in 2009. The next step will be independent provider of information and research to the expansion to 1,800 tons per year. investors in clean energy and the carbon markets, this trend should continue until 2015. Prices per kilogram Financing and technological expertise silicon could then be below US$ 67 until 2013. But not everybody has been optimistic of the price But not all manufacturers with plans to enter silicon development. Critique has mainly been directed at the production are successful. According to the study “Poly- silicon manufacturers that today seem to expand their

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plant would require to move into different location “, said Sonnenschein. Solarworld has for now secured the largest part of the silicon supplies though long-term contracts. As re- cently as August, the Group had signed a contract worth about US$ 580 million with the South Korean DC Chem- ical to regulate the supply of polysilicon between 2010 and 2016. In the future, the S&WE silicon world map will prob- ably be filled with further locations. From interviews with potential manufacturers, it became clear that the expansion in 2008 is not yet closed and that more ca- pacities will be added in the next few years. At the same time, the amount of silicon needed per Watt will de- crease as the share of thin-film technologies on the to- tal market is steadily growing and wafer slices get in- creasingly thinner.

Wafer: much more than a slim difference Opening ceremony of new Joint Solar Silicon production S&WE is for the first time giving a comprehensive over- in German Rheinfelden. capacities only as far as could already be sold through view of the world’s wafer manufacturers. Of the 127 sur- Photos (2): JSS existing long-term contracts. Both, the silicon shortag- veyed, 52 provided information on their capacities be- es and the high prices, are in the long run preserved. tween the years 2007 and 2008. However, as not all par- So far, manufacturers continue to profit from the ticipants were able or willing to specify MW amounts, high and lasting price levels and list a promising turn­ the results are not on the whole comparable and in- over and revenues. Compared to the first quarter, the clude numbers of item, tons and, in the case of BP So­- Wacker silicon division was able to raise sales by 24 % in lar, even surface in square decimetre. Similar to the the second quarter. Looking back at the year-ago quar- module, cell and silicon industry, the wafer manufactur- ter, sales almost redoubled to US$ 281 million. The com- ing sector has in the last few years seen profound pany is now confident that the existing long-term sup- changes with new companies entering the market and ply contracts will generate an income of US$ 1.2 billion trying to push aside former market leaders. In 2006, the until the year ends. leading companies in terms of capacities were REC (Norway), Deutsche Solar and PV Crystalox (both from Alternative to the Siemens process Germany). REC and Solarworld subsidiary Deutsche So- Raimund Sonnenschein, CEO lar indicate unbroken market lead in 2007. Vertically in- of Joint Solar Silicon. Regardless of high profits, the silicon manufacturers tegrated Solarworld in the last year had a capacity of have been researching alternative methods to the es- 385 MW and will expand to 450 MW until the end of tablished but immensely energy intensive Siemens 2008. The company only directs about half of the out- process. In August 2008, Joint Solar Silicon (JSSI), a col- put to the in-house cell and module production. Of the laboration of German based Solarworld and Evonik De- 50 % that is being sold, about 90 % is floated on export gussa, launched a new silicon factory in Rheinfelden markets. REC does not disclose details on capacities, but (Southern Germany). JSSI produces silicon by refining its outputs are unambiguous. In 2007, the company silicon powder from monosilane instead of using arrived at 506 MW. For the current year, a volume of chlorsilane. Evonik Degussa’s existing silane production 630 MW is expected. in Rheinfelden was an impetus for choosing the pro- duction location. Different from the Siemens process, Established and new wafer the reactor has not to be shut down and the silicon can manufacturers push capacities continuously be obtained. But the decomposition of si- lane is also less energy intensive. “Compared to the tra- Similar to the industry on other stages of the value- ditional Siemens process, our method saves 90 percent added chain, the wafer manufacturers are in a process energy”, said Raymund Sonnenschein, CEO of JSSI in of expansion. Many newcomers, especially from China, August 2008 on occasion of the opening ceremony. will this year launch their production. One example is In the beginning, the pilot plant is designed to pro- Jiangsu Grand Photoelectric Company from Yancheng duce 850 tons per year. This means that silicon from in the province of Jiangsu, which in 2008 achieved a ca- Rheinfelden currently covers only 20 % of the demands pacity of 120 tons of wafers. Another company in this at Solarworld AG. If the process, however, delivers respect is Furi Electronic Material from Shanghai that optimal performance, the partners are thinking entered business with a capacity of one million mono­ about construction of larger plants in the next year. crystalline 6 inch wafers. But there are also other man- “The idea of a small expansion of the production in ufacturers that started their wafer production in 2007 Rheinfelden is not so far off. Since there is, however, on- and that are trusting in growth. One such example is ly limited space available, the construction of a larger the Chinese Desun Solar Energy that last year started to

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About 50% of silicon is lost when slicing ingots with saw wires. Impurities through slurries at the same time prohibit recycling.

Conventional saw wire – new techniques with less silicon waste are being developed around the globe.

produce moncrystalline wafers of 125 x 125 mm2 and 156 x 156 mm2 dimension in Shangrao in the province of Jiangxi. The initial capacity of 100 MW will in 2008 be driven up to strike the target of 350 MW. But also well-established manufacturers are expanding their capacities. One of the most impressive examples is Chi- nese Sunoasis from the province of Xinjiang. The company ramped up production in 2006 and this year wants to raise ca- pacities by 25 times from 20 MW in 2007 to 500 MW. Another

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Silicon production capacities are given in tons, wafer production capacities in MW or as pieces. If wafer producers did not report their capacities in MW or pieces, only the production site is marked on the map.

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example is Chinese Renesola from Jiashan in the prov- ince of Zhejiang. The company wants to raise last year’s capacities of 378 MW to 645 MW before the end of the year. In contrast, Jiangsu Shunda Group from the prov- ince of Jiangsu keeps to the amount of 70 million items produced in 2007. For the next year, however, the Group has announced to go public, which is expected to wash US$ 1 billion into the corporate asset. Part of this vol- ume will be directed at the construction of a new silicon factory.

Kerf loss pushing up costs Today, the production method with the widest applica- tion is the slicing of ingots with wire saws. However, the method’s disadvantage is that for every wafer an almost equal amount of silicon is lost in form of kerf that can- not be returned to the process after contact with slurry. In order to increase the number of wafer slices pro- duced from the rare material, manufacturers have been looking for ways of reducing the wafer width. While a regular wafer today measures 200 µm, manufacturers are ambitious to obtain even thinner diameters. Norwe- gian REC Group, for example, has been collaborating with U.S.-American SiGen on a new wafer technology to do away with lubricants, saw wires and the kerf prob- lem in one fell swoop. At mid year, a prototype of 50 µm was for the first time obtained. But with wafers becoming more and more fragile, the issue rises of whether a fully automated down- stream processing will still be possible or whether the further handling would have to be taken out by em- ployees. However, adding manual steps to the produc-

120 Sun & Wind Energy 5/2008 new vogt group serving the PV industry worldwide

Meyer Burger wafer slicer: Details on the existing production capacities in the wafer factory in Frank- furt/Oder are not disclosed by Conegry. tion also increases the danger of wafer breakage. A technical solution to continue the automated process- ing of the wafers has been developed by Germany Fraunhofer IZM. The delicate wafer slices are here elec- trostatically fixed to a carrier wafer. While the thinness of the wafers is improving, the application range also The newly established vogt group SE grows. Slender wafers are not just leading to better flex- ibility but to a larger applicability on curved surfaces. bundles services covering all aspects of PV factory design and factory life Pulling an alternative to slicing cycle support. Next to the widely established slicing method, the pro- duction of wafers from a silicon ribbon has been intro- duced. U.S.-American Evergreen Solar makes use of a Visit us at 2008 String Ribbon technique. In this method, the wafers are October 13 - 16 pulled directly from the silicon melt with two wires. The San Diego, USA, Booth 1823 advantage towards wafer slicing is on the one hand that no impure kerf is produced and on the other hand that only 5 g of silicon per Watt are needed. Evergreen is already looking for growth. It is expected that capac- 10 years experience in PV factory design ities will increase by six times from 15 MW in 2007 to 90 MW until the year ends. The company’s new produc- tion lines already rely on a quad technique in which four silicon bands are simultaneously extracted from the silicon melt. services for operation and optimization But there are also other companies with an interest of production lines in this technique. EverQ will ramp up production in 2009 in Thalheim, Germany, and license the Evergreen technology. “Our own expansion plans that foresee a Helmholtzstraße 2-9 10587 Berlin · Germany raise of capacities to 500 MW until 2012 plus the expan- Phone +49 30 39 74 40-0 [email protected] Fax +49 30 39 74 40-10 www.vogtgroup.com photovoltaics

Daqo New materials: www.daqo.com DC Chemical: www.dcchemical.co.kr Dongfang Electric Corp.: www.dongfang.com.cn Elkem: www.elkem.no Emei Semiconductor Material: www.emb739.com GCL Silicon: www.gcl-silicon.com Hemlock Semiconductor Corp.: hscpoly.com Honbridge Holdings: www.8137.hk Jaco Solarsi: www.solarsi.com Jiangsi Shunda: wwshundasolar.com Jinglong Group: www.jinglong.net Jingxin Technology Corp.: www.Jingxin-tech.com Jinhua Smelting: www.lhjhyl.com Joint Solar Silicon (JSS): www.js-silicon.de LDK Solar: www.ldksolar.com Linzhou Zhongsheng Semiconductor Silicon Material: www.renesola.com Maharishi Solar Technology: www.maharishisolar.com MEMC Electronic Materials: www.memc.com Nan´an Sanjing Silicon Refining: www.fjsjsi.com PCMP (Podolsky Chemical & Metallurgical Plant JSC): www.pcmp.ru Wafer production at Qinghai New Energy: www.qhsolar.com PV Crystalox. RSI Silicon: www.rsi-silicon.com Sharp Corp.: www.sharp-eu.com Photo: PVCrystalox sion of EverQ will help to turn the String Ribbon tech- Solargiga Energy Holdings: www.solargiga.com nique into a leading production method in the PV sec- Sumitomo Corp.: www.sumitomocorp.co.jp tor”, said Richard M. Feldt, CEO of Evergreen Solar. Tokuyama Corp.: www.tokuyama.co.jp Wishing to grow independent from the rare solar sil- Wacker Chemie: www.wacker.com icon material, several manufacturers are meanwhile al- so trusting in upgraded metallurgic silicon (UMG). One Wafer producers: Aide Solar Technology: en.aidesolar.com such example is the Chinese LDK that in the second Amex: www.amex.narod.ru quarter sold its first UMG-based Nova wafers. The com- BP Solar: www.bpsolar.com pany is one of the world’s largest wafer producers and Central Electronics: www.celsolar.com Changzhou Eging: www.eging.cn continues a growth trend. Before the year ends, produc- Cixi Hongyu Electric Appliance: www.cnhongyu.com tion will be boosted from 580 MW in 2007 to 1.2 GW. By Dacheng Silicon Technology: www.chinadacheng.com.cn August this year, the company had already announced Desun Solar Energy: www.desunsolar.com to have touched the 1 GW mark. Expansion towards Deutsche Solar: www.deutschesolar.de Ersol: www.ersol.de 3.2 GW is planned until 2010. To achieve this ambitious ET Solar China: www.etsolar.com target, the company has closed a contract over US$ 220 Evergreen Solar: www.evergreensolar.com million with Applied Materials for the supply of wafer EverQ Solar: www.everq-solar.com GSMSolar Kunshan: www.gsmsolar.com production equipment. As recently as August, LDK had Hebei Jinglong Group: www.jinglong.net in addition signed an agreement with Korean Hyundai Helios Resource: www.hr-pv.com Heavy Industries for the supply of wafers in the range of Jiangsu Huantai Silicon Science and Technology: www.jshuantai.com Jiangsu Province Xunshi Group: www.xun-shi.com 440 MW over the next six years. Jiangsu Shunda Group: www.shundasolar.com Wafer production delivers the second largest profit Jiaxing Winsaint Photovoltaic: www.winsaint.com margin after solar silicon along the value-added chain. Jinggong P-D Shaoxing Solar Energy Technology: www.jgsolar.com In 2006, the wafer industry had exhibited an EBIT mar- Jinxiyuan Science & Technology: www.jinxiyuan.com Kaihua Huayou Monocrystalline Silicon Electronic Technology: gin of 23 % to 30 %. While Solarworld’s wafer division www.zjhuayou.com had pillared only one quarter of the Group’s turnover Kinko Engery: www.kinkosolar.com picture, the production of wafers had however deliv- KinVe Solar Power: www.kinve.com LDK Solar High-Tech: www.ldksolar.com ered 50 % of the profits. Photowatt International: www.photowatt.com Similar to the silicon market, both, the expansion of Prolog Semicor: www.semicor.ukrpack.net capacities and the sharpening competition, are paving PV Crystalox Solar: www.pvcrystalox.com the way for a price decline in the next few years. “Aver- Q-Cells: www.q-cells.com Qinghai New Energy: www.qhsolar.com age wafer prices will at least in the case of forward con- ReneSola: www.renesola.com tracts remain high in 2009. In course of the five subse- Shanghai Comtec Solar Technology.(SCST): www.comtecltd.com.cn quent years, we are expecting prices to drop by 41 %”, Solarfun Power: www.solarfun.com.cn Solargiga Energy: www.solargiga.com said Michael Liebreich, CEO of the research firm New Sushou Semi-Materials: www.semimaterials.com Energy Finance Limited in London. Following the re- Suzhou Shenglong PV-Tech: www.shenglong-solar.com/ searcher’s Silicon and Wafer Price Index, wafer prices Swiss Wafers: www.swisswafers.ch Tianwei Yingli Solar: www.yinglisolar.com will be falling below US$ 6 per item or US$ 1.62 per Watt Trina Solar: www.trinasolar.com with the turn of 2011. Wacker Schott Solar: www.schott.com/photovoltaik Stefan Hausmann Wafer World: www.waferworld.com Wuxi Konca Solar: www.konca.cn Xi’an Lijing Electronic Technology: www.xalijing.com Further information: Xinjiang Sunoasis: www.sunoasis.com.cn/ Youze Technology: www.youzetech.com/ Silicon producers: Zhejiang Jinxiyuan Science and Technology: www.jinxiyuan.com 6N Silicon: www.6nsilicon.com Zhejiang ShiBo Mechanical & Electrical: www.mc88.com.cn Advanced Silicon Materials (REC): www.recgroup.com Zhejiang Sino-Italian Photovoltaic: www.sipv.com.cn CSG Holding: www.recgroup.com ZNSHINE Techology and Renewable Energy: www.znshine.com

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