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November 19, 2008

BP Solar to Close Cell Manufacturing Plant

Sydney, Australia [RenewableEnergyWorld.com]

BP Solar will stop producing solar photovoltaic (PV) cells and panels at its manufacturing plant in Sydney Olympic park at the end of March 2009. The company said that is looking to focus its operations at larger scale plants in lowest cost manufacturing countries, in order to drive down the cost of solar power for consumers.

"The challenge for solar power is to reduce its costs to the level at which it competes on an equal footing with conventional electricity delivered through the power grid. To do this we need to expand at scale and reduce costs."

-- Reyad Fezzaniglobal, CEO, BP Solar

The BP Solar sales and marketing team in Australia will continue their activities, and aim to grow the sales and servicing of solar products. However, BP Solar said it regrets that approximately 200 jobs will be lost from the manufacturing plant.

"The challenge for solar power is to reduce its costs to the level at which it competes on an equal footing with conventional electricity delivered through the power grid. To do this we need to expand at scale and reduce costs," said Reyad Fezzani, Global CEO of BP Solar.

Reader Comments (12)
 
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November 19, 2008
The government should realise that the $ cost of solar must be weighted against the environmental benefits and the jobs that the solar energy industries provide. The government of Australi needs to contribute incentives to keep the BP facility running and expanding. Austalia needs environmental industries that manufacture inorder to be a leader in the field of environmental products. Entice BP to remain in Australia before another oppoprtunity is lost forever.
Comment 1 of 12
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November 21, 2008
Crazy: they throw tons of money in to pump up the economy and to prevent unemployment. They think of subsidizing carmakers to sell outdated and inefficient products. This money would for sure be enough to keep the factory humming and provide a product that would pay for itself in terms of energy imports. Australian Government could even finance it without real cost to the taxpayer: simply by becoming a sort of contractor that finances the investment in the panels and skims off the cost difference to energy costs to recover the financing. Can anyone explain it to the governments, please?
Comment 2 of 12
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November 21, 2008
Get real fowlkes!
Get educated on "ratchet" rackets.


BP is Big Profit for Big Oil. Solar is competition to the BP of Big Oil.
Shell and BP purchased solar to close it down.

BP also purchased ethanol refineries.
The third largest ethanol plant in the US filed for bankruptcy this month.
That ethanol plant represented 13% of the US total ethanol production.

BP Big Profit from BP Big Oil will continue to procure competition to close down. Make Big Profits. Temporarily ratched down the price. Run out the competition. With competition gone, raise Big Profits.

The Ratchet Racket
Ratchet up profits for BP, Big Oil, Shell.
Ratched down prices to starve out competition, solar, wind, hydro, biomass.
Ratchet up prices at will.
Brace up. What BP rachets down will always racket back up many fold.
What goes down must go up.
Comment 3 of 12
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November 21, 2008
I have dealt with people at BPs solar division and they believe in solar, and are really nice folks. The people in BPs solar department believe in solar, and so does the company. I agree it is both unfortunate and shortsighted to close that Australian plant. The ability to move panels from China or wherever they will make them for the Australian market is dependent on cheap petroleum, which will not last long.

BP bought solar to make money, and they have done so. I have installed dozens of their panels, and they make a nice product. BP makes a lot of panels, of good quality, at a reasonable price, and they will continue to do so as long as it is profitable.

Ethanol is a scam, anyway. It takes 11 calories of petroleum to get 10 calories of ethanol from corn, which is the kind of ethanol made in the US. If the plant got shut down, that is a good thing. Ethanol subsidizes American corn farmers at a heavy cost to the environment. On calorie based accounting, its a net loss.

Further, another thing BP Solar does is donate panels to a lot of people. They donated panels for a classroom at Maya Mountain Research Farm (MMRF) in Belize (www.mmrfbz.org) and recently donated panels for a water pumping application that MMRF is installing in a Maya community. That system will benefit 40 households. There is nothing in it for BP except that I mention it sometimes, and the warm feeling the people at BP get knowing their panels make a huge difference in the quality of life for that community.

Solar is business, and all the companies doing solar expect to make money, and they will. Other markets will expand and contract, but the market for energy can only increase, and the market for clean energy is one that increases as the cost of dirty energy goes up.
Comment 4 of 12
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November 21, 2008
Yikes - this is brutal...BP may have purchased their way into the Solar Industry but since then they have been willing to invest in plant capacity, conversion from mono to poly silcon and the creation of world class products. There is an issue with silcon based production that scale matters a whole lot - bigger plants & lines can produce more product cheaper. The closed plant in Austrialia has been more then offset by added capacity around the world. As a business, BP Solar has to deliver a high quality, competitively priced product and yes, they are not going to subsidize from oil proifts - the business has to stand alone and it can!
I have seen the Management of BP Solar at numerous government forums pushing for positive government policies on Solar Energy.
So while no one likes the machinations of the oil industry and its up & down swings in our energy costs, I retain great respect for BP Solar.
Comment 5 of 12
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November 21, 2008
I would also like to understand how Solar Energy is in competion with Oil. The bulk of oil is consumed in transportation - ships, planes, trains & automobiles. Solar Energy produces electricity, which pretty much powers industry, homes & commercial buildings. In the United States, 75% of Electricty is generated from coal - oil actually accounts for significantly less then 10%, and this will gradually be eliminated because coal is substantially cheaper and their is ample domestic supply at consistent pricing. I will state that coal is cheaper because the price of the fuel and the power plants ignore the environmental impact (strip mines, open train car shipment, water pollution, then it gets burned to release CO, CO2, NOx, Sulfur, Mercury, Cadmium, tar, ash, dust and such).
Renewable Energy (Solar, Wind, Geothermal) is in competiton with coal and IF we just enforced existing EPA regulations for clean water & air, the cost imbalance would largely disappear.
And IF you really believe all the hype about "Clean Coal", ask yourself why 7 Eastern states have had to wage a 5 year legal battle against the damage pollution from Coal Fired power plants to the West of us is doing to our environment. The States in question, the Utilities, and the EPA have all refused to force the clean up, even though the EPA has the authority to enforce a "Best Available Technology" standard - it continues to grant waivers. So our state tax dollars are consumed in a very expensive legal battle that wouldn't exist if "Clean Coal" did...
Comment 6 of 12
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November 21, 2008
At the risk of engendering disagreement with many people I know and respect, a single issue rises to the surface for me:

Solar Energy is not only solar electricity, it is solar thermal as well. Importation of natural gas is becoming a major concern, if for no other reason than that the US is exporting dollars and importing a non-renewable fossil fuel comodity that generates carbon dioxide and nitrous oxides, and is used to fuel the least efficient peak power electricity generating facilities, in large part. Why heat water or homes with largely imported fuels? Heating water with PV is highly questionable from a cost-effectiveness perspective, to say the least. PV's great quality and value is that it can be the final, essential element of sound renewable energy policy after energy efficiency and solar thermal have contributed to the goal of reducing building energy consumption. Best regards.
Comment 7 of 12
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November 21, 2008
In strong agreement with the preceding: Solar hot water integrated with passive solar architecture needs to become standard for new construction. It's just plain common sense---cost-effective in nearly every climate.

Solar architecture backed by solar plumbing and HVAC: Let's roll!

(Save the oil for the Big One.)
Comment 8 of 12
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November 21, 2008
BP has previously announced an agreement to purchse solar panels from JA Solar. It makes a lot of sense to buy from a low cost supplier and certainly by increasing JA Solars volume, the economies of scale will arrive much quicker for this industry.
Comment 9 of 12
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November 21, 2008
I'd like to add a couple more things to the solar thermal above. Passive solar combined with super insulation with solar thermal or geothermal or advanced air to air heat pumps approaches zero energy use. Add PV and you can get zero net energy with a new building. Air to air and ground source heat pumps are forms of solar thermal. Some geo is also earth core.
Comment 10 of 12
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November 22, 2008
Thin film is the new wave of solar and obviously that means alot of pv manufacturers that havent changed are going to go under since poly and mono crystaline are not as efficient and definetly arent as affordable. With our new solar powered heat pumps and geo thermal solar powered heat pumps solar is the future. Thin film is now going to lead the industry for the next decade. and vertical updraft turbines are also a great low cost power producing source as well. Renewable energy rules!!!
Comment 11 of 12
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November 24, 2008
Is that BP Solar Plant up for sale? Or are they going to strip it and ship out the capitol equipment to a 'Low Cost Country', ( Read, 'Pegged Currency Rate' Country )
When a Big Corporation Like BP says that they can't make any money with the plant(s) they have in one country and need to move production to another there is something you need to understand.

Big Corporations are by their nature Inefficient, waste huge sums of money and really can't produce profits very effectively. Corporations like BP can continue to run their businesses like this because they play in Very Niche Markets that are largely devoid of strong competition and so can perpetuate their poor business practices and be successful enough to keep their shareholders happy.

I could take that operation subtract all Crap that BP burdens it with, turn it around and make huge profits... More than enough to keep the 200 jobs, and build a competitor that could daily beat the pants off of BP or any other Big Old Corporation of similar ilk.

I've seen this before. Don't discount what 200 committed people can do. Just because BP can't do it doesn't in any way mean it can't be done. Big Old Corporations bring Big Overhead to everything they do and need even Bigger Margins just to make it worth it. In the end they can't compete with a lean and effectively run operation that would be fat and happy on half the margins Big Old BP needs just to break even.

It is small businesses that bring real revolutionary change to markets, not the Big Old ones.
Besides BP has its focus blurred by going in 50 different directions at the same time.
A small sharply focused company can out perform any Big Old Company any day, any place.

BP can close that plant, strip it of the machinery and ship it off to who knows where.
But if they don't ship out those 200 workers, they are leaving the most valuable asset behind.
Comment 12 of 12
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