SolarWorld Secures Silicon Contract for Expansion

SolarWorld of Germany has concluded a landmark agreement for future commodity supplies of silicon for solar photovoltaic (PV) production. Its subsidiary Deutsche Solar, one of the world’s largest manufacturers of solar silicon wafers, has signed a 10-year framework contract with silicon manufacturer Wacker on the supply of solar-grade silicon.

The long-term contract will be effective as of 2007 and extend until 2017, securing one of the elements of the Group’s fundamental supplies for the long term. “Due to the strong growth of the international photovoltaic industry, the solar industry already produces more silicon wafers than the electrical industry in surface terms,” said Peter Woditsch, the Management Board spokesman of Deutsche Solar. “In a few years’ time, the silicon volume required for solar wafer production will also exceed the volume required for electronics applications.” International growth of the solar industry will be restricted in 2005 and 2006 because of the existing silicon production shortage, Woditsch said. With the 10-year contract for a supply of solar-grad silicon, Deutsche Solar will be able to move ahead with its plans for expanding solar wafer production from the 2004 capacity of 120 MW to 220 MW by the end of 2006. SolarWorld recently secured a financing package of Euro 80 million (US$ 103 million) to fund their plant expansion. The move is expected to increase the company’s market presence at a time when Germany offers one of the most robust markets for solar in the world. The investments will go into modern production buildings and into the expansion of the infrastructure. In addition, the TCVP melting kilns developed by the company itself will be employed for crystallization in the so-called “Silicon Saxony”. Several hundred new jobs will be created in the company itself as well as in the supplier companies as a result of these investments. “The financing secures the expansion of solar wafer production at the Freiberg location and enables us to continue our course of expansion from the past,” Ekhard von Dewitz, CFO of Deutsche Solar, said in an earlier press release. “With this expansion Saxony and Freiberg establish themselves as the European solar power center.”