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A N E R A C P U B L I C A T I O N

In the Publication

Introduction ................................................................................1

Thin films are the wave of the future .........................................1

US players to watch ...................................................................2

Chinese players to watch4 Rising Stars ....................................3

The Future ..................................................... .............................6

About the Author ........................................................................8

About Nerac ...............................................................................8

References .................................................... .............................8

ANALYST REPORT

China & the Future of SolarPhotovoltaic echnology:CIGS Tin-Film Solar Cells Will Rock the Industry

Written by:

Gerri Potash, Nerac Analyst



Nerac Inc. | 1 Technology Drive, Tolland, Connecticut 06084 | 860.872.7000 or visit us on the web at www.nerac.com

© 2009 Nerac Inc. All rights reserved.

Introduction

New technologies for exible photovoltaic cells show promising signs of transforming solar

power generation. Thin lm photovoltaic (PV) cells composed of copper, indium, gallium, and

selenium (CIGS) use only one percent of the material used in conventional crystalline-based

silicon solar cells and are expected to prove cost-effective alternatives to fossil fuels.

China is a natural t for the manufacturing and commercial development of CIGS solar cells: it

is the world’s most populous country, holds vast natural resources, has experienced explosive

industrialization and modernization with nearly-insatiable energy requirements, and faces

serious industrial pollution problems. In addition, the Chinese government is developing its

own stimulus plan to increase the focus on renewable energy industries. China, the world’ssecond-biggest consumer of energy, now derives 80 percent of its electricity from burning

coal. The country’s alternative energy goals include boosting renewable energy to 10 percent

of total energy consumption by 2010 (and 15 percent by 2020) from 7.5 percent in 2005.

In China in 2008 there were more than 200 manufacturers of solar panels, in aggregate

accounting for nearly half of the world’s total solar power generation.[1] Although China has a

relatively strong base of solar production infrastructure and know-how, most of China’s manu-

facturing focus and documented innovation (in the limited patent portfolios held by Chinese

companies in this space) has been on production of older silicon-based cells.

Thin films are the wave of the future

While photovoltaic cells have been predominantly based on crystalline silicon technology, thinlms are now sufciently advanced to offer signicant commercial opportunity. The efcien-

cies of amorphous silicon, cadmium telluride, gallium arsenide, and copper indium diselenide

or copper indium gallium diselenide are high enough to now compete with crystalline silicon.

Analysts are projecting up to $1.3 billion in revenues for competing technologies in the thin lm

space this year, such as amorphous silicon based photovoltaics, and market growth to $4.1

billion in 2014 for these types of technologies. The market potential for thin lms will be real-

ized when their integrated use in roong shingles and other building materials is more feasible

and cost-effective.

The balance between energy efciency and cost of production is shifting as CIGS technol-

ogy advances, through a new controlled alkaline addition technique and the development of

new materials. CIGS solar cells are not as efcient as crystalline silicon solar cells, but they

are expected to be substantially less expensive once fully commercialized. The efciency of

thin-lm photovoltaics is approaching 20 percent, and new advances are expected to confer

additional improvements. [2]

There are other challenges to bringing CIGS technology into the mainstream. Current technol-

ogy leaders have found it difcult to bring high-performance exible CIGS photovoltaic cells

to the marketplace due to their extreme sensitivity to water and the need for protective lms



that meet stringent requirements. They must be compatible with the CIGS energy conversion

process, transparent, exible, durable, handle temperature extremes, and have life expectan-

cies of 20 years (the benchmark lifetime for roong materials). However, with a front side

barrier technology in development at companies including 3M, Fuji, Mitsubishi, Vitex Systemsand Protoex, the state of commercialization in CIGS cells is rapidly changing.

Another challenge inherent in PV development is resource availability, with the depletion of

traditional sources.[3] Indium, an important component of the conducting oxide used in at-

panel displays and photovoltaic cells, is the main concern. The National Renewable Energy

Laboratory predicts constraints on indium availability once production reaches the tens

of gigawatts levels. Thomas Jansseune of Compound Semiconductor commented on the

rising prices and limited availability in 2005: “[t]he business closures and start-ups that have

been announced could trigger a shift in the supply base. Integrated manufacturers of indium

products, which have indium production and recycling in house, will be in a winning position.

For whatever application, be it InP chips or ITO coatings, control over the supply chain will be

crucial.”[4] New indium production from China and South Korea will be important to building thin

lm production capacity.

US players to watch

Academic and corporate researchers around the world continue to study preparation tech-

niques of the various layers of CIGS thin lm solar cells, such as pulsed layer deposition, to

increase performance.[5] Current leaders in this space include Global Solar Energy, Solopow-

er, Miasole, Nanosolar and Solyndra. Nerac’s proprietary patent analytics provide insights into

the areas of focus for solar technology development. The area of greatest patenting activity is

batteries (thermoelectric and photoelectric); Global Solar, Nanosolar and Solyndra collectively

have ten patents in the class. Multiple recent patents have been granted for semiconductor

device manufacturing processes (Nanosolar and Solopower), coating processes (Nanosolar),

and active solid-state devices (Global Solar, Miasole and Nanosolar).

The early entry of Global Solar into the thin lm space is evident from a review of the patent

landscape, Figure 1: Timeline for Filing of US Patents in Thin Film Space.

Figure 1: Timeline for Filing of US Patents in Thin Film Space

Global Solar’s head start helps to explain why that company is one of the two market leaders

with commercial-scale operations today.

Further analysis reveals that Global Solar is the only one of the leaders showcased that does

not have an existing portfolio of pending applications in the World Patent and US patent ofces

2



3

(see Figure 2: Innovation Leaders). This is a sign that s gs s s

the market for thin lms matures.

Figure 2: Innovation Leaders

The leading US thin lm developers have adopted various strategies for technology develop-

ment and commercialization. These are summarized as follows:

― Global Solar, TucSon, arizona

Global Solar is nanced, owned and operated by MMA Renewable Ventures, LLC, a

subsidiary of Municipal Mortgage & Equity, LLC. The company’s 100,000 square-foot

manufacturing facility was the rst commercial-scale deployment of its CIGS cells. The

company has thus become the only CIGS leader to have its own technology powering

a commercial-scale solar array. SOLON Corporation produced and installed the PV

modules and designed the array. The installation covers 310,000 square feet, featuring

a ground-mounted array that uses 6,600 SOLON solar modules utilizing Global Solar’s

CIGS thin-lm solar cells.

― MiaSole, SanTa clara, california

Miasole’s manufacturing process for solar cells differs from other companies’ processes,

using a sputtering process to deliver active material to substrates of glass and foil. This

process is similar to that of the sputtering method used to deliver magnetic materials

to hard drives in the computer industry. (The founder of Miasole, Dave Pierce, is a

transplant from the computer industry.) Miasole’s progress toward commercial-scale

production has been somewhat slower than its competitors’. Recent reports indicate that

commercial production “isn’t expected to begin until 2009.”[6] Changes in management

and an increase in burn rate of venture funds highlight the company’s struggle to achieve

its performance goals.

― nanoSolar, San JoSe, california

Although Miasole was attracted to the CIGS solar cell space at approximately the same

time frame as Nanosolar, Nanosolar has joined Global Solar as the second US-based



4

leader in commercial production. After ve years of venture-funded development, product

was rst shipped to a power plant in Eastern Germany for commercial use. The econom-

ics of printing non-vacuum/solution coated material is realized in the Nanosolar products,

which have allowed Nanosolar the distinction of being “the rst solar manufacturer ca-pable of protably selling solar panels that generate as little as $0.99/w; and the highest-

current thin-lm solar panel, delivering 5 times the current of any other thin-lm panels on

the market.”[7] [8]

― Solyndra, freMonT, california

Solyndra’s panels are unique in their incorporation of cylindrical modules that allow air to

blow through them. The expected market appeal will be their unique design and simplied

installation process. Solyndra’s aluminum frames snap together in a way that the company

claims a reduction in installation time by a third, and an even more signicant reduction in

installation price. Signicant venture funding and reported early contracts keep Solyndra

on the radar screens of market analysts. Solyndra was also the rst recipient of a loan

guarantee from the US Department of Energy. This money will fund manufacturing capac-

ity expansion.

― Solopower, MilpiTaS, california

Solopower uses electroplating to afx materials to the cell substrates. Solopower, like

other market leaders, has received hundreds of millions of dollars in venture funding to

move past research into commercialization, including $200M in September of 2008 to

expand manufacturing.[9]

Rising Stars

One of the newer innovators to enter the CIGS solar cell space is HelioVolt in Austin, Texas.

HelioVolt’s manufacturing process coats two precursor particle suspensions onto two differ-ent substrates. The substrates are then brought together in a ash heating process, which

minimizes diffusion of the materials and creates a dense CIGS lm. Although HelioVolt

“won’t be shipping commercial thin lm solar material until at least early 2010”,[10] its FASSTTM

manufacturing process targets costs much less than $1 per watt,[11] which is competitive with

fossil fuels.

Additional US-based companies such as First Solar are competitors in the thin lm market-

place. First Solar specically supports development of a CdTe (Cadmium Telluride) cell, an

alternative to CIGS technology with Cadmium toxicity issues. Furthermore, CdTe cannot be

used with a exible substrate. Thus, although First Solar is typically credited with bringing a

new era of thin lm solar cells forward with $1.3 per watt low cost and 11 percent efciency,

other players now show more promise as stable xtures for the future.[12]

Chinese players to watch



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Among the many Chinese companies manufacturing PV panels, several are moving toward

newer technologies; indeed, nearly one-third of the companies participating in a March 2009

conference of module and cell manufacturers were Chinese. Some of the leaders include

China Nuvo Solar Energy, Shenzhen Topray Solar, Suntech Power, and the Xinao Group.

― china nuvo Solar enerGy (“china nuvo”), chenGdu, china

China Nuvo announced in 2008 its focus on CIGS technology in conjunction with Pioneer

Materials. A pilot production facility constructed in 2008 has begun commercialization

efforts toward multi-stacked solar cells. This type of stacked design is expected to provide

higher efciencies.

― Topray Solar, Shenzhen, china

Shenzhen Topray Solar, founded in 2002, is a leader in the silicon thin lm solar market.

Topray Solar is responsible for the Chinese National Project for next-generation solar

cells. Under the Innovation and Technology Fund of the Government of the Hong Kong

Special Administrative Region, the company is partnering to develop a magnetron

sputtering-selenization method for the fabrication on CIGS solar cells.

― SunTech power, wuxi, china

Suntech Power has grown to be one of the largest solar energy companies in the world

since its start in 2002. Suntech designs, manufactures and markets a variety of photovol-

taic cells and modules, especially silicon-based designs. The predecessor company, Wuxi

Suntech Power Co., Ltd., or Suntech China, was established in Wuxi, China. Suntech

Power Holdings Co., Ltd., or Suntech, is currently showing signicant growth as a publi-

cally traded company; it was the rst privately-owned Chinese company to list on the

NYSE and the rst Chinese company to ring the remote opening bell for the NYSE from

China in February 2009.

― xinao Group, lanGfanG, china

In November 2007 the Chinese natural gas company known as the Xinao Group an-

nounced its entry into the solar module business with the purchase of Applied Materials

SunFab. The company has thin lm manufacturing capabilities, which focus on deposition

of amorphous silicon onto glass panels. Since then forming ENN Solar, signicant invest-

ment has been made to extend its stake in the manufacturing of thin lms.

Te Future

Research is rapidly advancing CIGS technology to meet the four main goals for PV manufac-

ture: (1) conservation of materials, (2) uniformity of layers, (3) reduction in commercial-scale

costs, and (4) creation of products that offer durability competitive with traditional roong

materials. As the technological challenges are met, vast new markets will open for strong

and nimble players.



6

China-based partners, with established production sites, distribution channels and market

share will be of strategic importance to help non-Chinese companies clear the substantial

hurdles to successful deployment in China. China has the potential to become not only the

leading producer of solar photovoltaics, but also the leading user. Currently over 99 percentof what is produced in the solar photovoltaics industry “goes outside” according to the CREIA

secretary general Li Junfeng. [1] This is because the technology of today is too expensive.

The advancements in solar photovoltaics will shatter the economic barriers to use, and when

that happens, leaders in the thin lm space, specically CIGS cells, will reap substantial

rewards.

About the Author

Gerri poTaSh

Nerac Vice President of Technology Solutions Gerri Potash is also ananalyst who assists companies through advanced analytics of intellectu-

al property portfolios by drawing from her experience in guiding medical

device and pharmaceutical clients over commercialization hurdles. In

her role as vice president, Ms. Potash works with clients and Nerac

staff to build communication platforms to inspire and facilitate innovative

concepts. By assembling project teams that bring together analysts with

a wide range of expertise, Ms. Potash champions product development

efforts in new and fast-paced markets. As a medical device professional,

she has developed and executed quality program strategies for pharmaceutical and medical

device companies as well strategies to achieve regulatory approval on specic products.

Before joining Nerac, Ms. Potash spent several years assisting medical device, biotech and

pharmaceutical clients in technical and regulatory matters.

About Nerac

Nerac Inc. (www.nerac.com) is a global research and advisory rm for companies developing

innovative products and technologies. Nerac analysts are uniquely qualied to conduct objec-

tive, third-party clinical literature reviews to assist companies in meeting the European Union’s

new medical device requirements. Nerac analysts also deliver custom assessments of product

and technology development opportunities, competitor intelligence, intellectual property strate-

gies, and compliance requirements through a proven blended approach to custom analysis:

review of technical knowledge, investigation of intellectual property, and appraisal of business

impacts. Nerac deploys analysts in diverse disciplines to help clients discover new applica-

tions, serving as a catalyst for new thinking and creative approaches to business problems or identifying strategic growth opportunities.

No reproduction or further dissemination of the report in whole or part may be made without

the express written consent of Nerac, Inc. This report is provided on as-is basis and does not

constitute a recommendation to make or not make an investment. This report provides infor -

mation that the recipient must independently analyze and verify in its evaluation process. The

recipient of this report can accept or reject its ndings at its sole discretion. The terms of any



7

investment decision, including the merits and risks involved, must be solely and independently

analyzed by the client.

Nerac specically disclaims any and all warranties, including without limitation, warranties of merchantability and tness for a particular purpose. This Report is given on and as of the date

hereof only, and it does not contemplate, and no opinion is given or intended with respect to,

future events or subsequent changes or developments in science, law or fact, and Nerac has

no obligation to update this report with respect thereto. Nerac shall not be liable for any loss,

injury, claim, liability, or damage of any kind resulting in any way from any use of this report.

Bibliography

[1] Bioello, David., “China’s Big Push for Renewable Energy.” Scientic American, Aug 4,

2008.

[2] Business Wire., “China Nuvo Solar Energy Announces Plans to Use Thin Film CIGS in Its

Pilot Production Project.” [Online] Apr 9, 2008. [Cited: Jun 25, 2009.] http://www.business-

wire.com/portal/site/google/?ndmViewId=news_view&newsId=20080409005268&newsLa

ng=en.

[3] Nolan, Robert., “New NanoMarkets Report Identies Trends and Opportunities in Thin-

Film Silicon Photovoltaic.” [Online] Mar 26, 2009. [Cited: Jun 25, 2009.] http://www.reuters.

com/article/pressRelease/idUS107188+26-Mar-2009+PRN20090326.

[4] Jansseune, Thomas., “Indium price soars as demand for displays continues to grow.”

Compound Semiconductor, May 10, 2005.

[5] Luo, Pai-feng, Guo-shun Jiang, Chang-fei Zhu., “Pulsed Laser Deposition ZnS Buffer Lay-

ers for CIGS Solar Cells.” Chinese Journal of Chemical Physics, 2009, Vol. 22, pp. 97-101.

[6] Kanellos, Michael., “Miasole’s Chief Researcher Defects to Solopower.” Greentechmedia,

Apr 17, 2009.

[7] Derbyshire, Katherine., “The problems and possibilities of thin lm CIGS solar cells.” Solid

State Technology, Jan 2008.

[8] Schuller, Jason., “Nanosolar Ships its First Product.” Revolution, Jan. 22, 2008.

[9] Morrison, Chris., “Solopower is latest thin lm company with a big raise, taking $200M for

a factory.” VentureBeat, Sept 11, 2008.

[10] Ehrlich, David., “HelioVolt Delays Commercial Shipping Until 2010, While CEO StepsDown.” earth2tech, Feb 4, 2009.

[11] Heliovolt Website., [Online] [Cited: Apr 16, 2009.] http://www.heliovolt.net/.

[12] Pakulski, Gary T., “Alternatives for Electricity: Analysts Give First Solar Edge in Race for

Cost Efciency.” Toledo Blade, Jul 15, 2007.

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