The Solar Industry Continues to Gain Momentum

There has been a lot of discussion recently about the “new” growth of solar power. But, in fact, solar has been around for decades. What is now “new” is the opportunity to dramatically expand solar by increasing access through economies of scale. A parallel can be drawn between solar today and the story of the automotive industry.

In the case of automobiles in the early part of the last century, the ability for the ordinary individual to own a personal car became a reality with the realization of assembly line manufacturing. There were two key elements: standardization, and the resultant reduction in costs, which then allowed for the economies of scale associated with a much larger market. The solar business responds to the same forces. With increased standardization come lower costs which drive larger markets. In addition, the size of manufacturing solar panels is now a match with the process equipment available from parallel industries such as flat panel and glass coating. Industries that have already developed low-cost capital equipment sets are ideal for thin-film solar manufacturing. Solar Market Driver: Cost/Watt While cost-per-transistor drives the semiconductor industry, the key metric that drives the solar industry is cost-per-watt. To reduce cost-per-watt, solar cell makers need to increase cell conversion efficiency, reduce the area-related manufacturing costs of the solar cell — or both. In just the past few years, solar panel production factories have become large enough to benefit from the scale of manufacturing that is the basis of companies like Applied Materials’ expertise in both area and technology optimization. In some regards the industry has reached a “tipping point” where the demand, infrastructure and number of manufacturers, have reached a high enough level that makes large scale production viable, and in fact facilitates still more growth. An example of the demand vs. cost curve has been proposed by Michael Rogol of Credit Lyonnais Securities Asia. This curve shows the market elasticity for solar panels once the solar industry crosses several “steps” from early stage competition with thermo-electric generation on mountain tops, to diesel in rural villages, to “peak power” and finally to “bulk power.” As solar cell prices drop, there are “take-off” points where demand shoots up. The challenge is to lower the production costs to where the sales prices drop to retail price electricity levels. With the production equipment and process expertise provided by large-scale manufacturing companies, industry players can now enter the roadmap well on the way to that critical “take-off” point. A similar perspective can be seen by considering the position of solar power in the general picture of energy costs. For typical consumers, electricity costs are manageable now, but increasing. As grid electricity continues to become more expensive and solar power costs continues to drop, when the two cost curves cross, then we can expect to see a significant expansion of the solar market. This fundamental is already apparent in places with high retail electric rates and low interest funding opportunities. How to Stay on the Decreasing Cost/Watt Path Today, the solar market has two primary technology avenues and each has benefits for different applications. Traditional solar cell technology is crystalline Si (c-Si) wafer-based. Unlike semiconductor chip processing, which has dozens of thin films and patterning steps, solar cell production requires only about a dozen processing steps. Therefore, the substrate wafer represents a sizeable portion of a solar cell’s processing costs. Manufacturers strive to use as thin a substrate as possible to drive down the material costs, however, a current wafer shortage is impacting wafer-based production. Despite the shortage, the c-Si segment represents a majority of solar cells production today and will continue to be a large portion for some time. The second approach for producing solar cells involves depositing thin films (TF) of photo-active layers. The primary TF layers are based on amorphous Si (a-Si), CdTe, or CIGS (CuInGaSe2) and are deposited on large sheets of glass or onto wide rolls of flexible materials. The TF method eliminates the costs and shortages associated with using polysilicon as a substrate and allows for larger substrate processing, providing an avenue to further increase economies of scale. Today’s c-Si panels which generate more electricity per area are most appropriate for area constrained applications such as private homes, where the most power-per-area is important. a-Si and other TF panels generally have lower energy conversion efficiencies and require larger areas to generate the same power as a smaller c-Si array. However, significant cost savings can be achieved with TF, and these panels are used where area is not as great a concern as is the overall cost. It is expected that there will be significant growth in TF applications for energy farms and rooftop installations in commercial building and rural applications. TF is ideal for the Building Integrated Photovoltaic market which is just now starting to be addressed. The growth rate opportunity in the TF market is estimated to be upwards of 60% through 2010. The Applied Approach The strategy to help enable cost/watt reduction is two-fold: 1) leverage the benefits of large-scale manufacturing expertise from the semiconductor segment, and 2) utilize engineering and technical expertise to drive down the production cost. The former is accomplished by leveraging large-scale solutions in the market such as adapting equipment from the display and glass coating industries as seen in Figure 1. The latter approach is exemplified in Figure 2, where the production cost-per-watt can be reduced by increasing the watts per area. For the TF case, extending technology from the flat panel display segment provides equipment that can effectively produce “jumbo” sized glass substrates for a-Si solar panels. These large area substrates drive down the production cost per area. These panels, up to 2.2m x 2.6m, can provide output upwards to 340W peak (under standard illumination conditions). By using state-of-the-art materials science, it is possible to use a more complex tandem structure which gives higher conversions efficiencies. Using advanced flat panel display technology, it is possible to increase the W/area, enabling these large panels to generate almost 450W peak. Another technical improvement for TF involved carefully tuning the sandwich structure to enhance the light trapping, again improving the conversion efficiency. In the case of c-Si cells, the Watt/area can be improved using a system to passivate the interfaces in the c-Si sandwich structure. In this case, using a PVD system tightens the distribution of the cell efficiencies by controlling the interface effects. As a result, more cells are produced with higher efficiencies and overall coating uniformity. The Solar Future is Coming Fast Critical mass and higher energy costs combined with increasing global energy demand are fueling requirements for larger, more sophisticated clean energy production facilities. As photovoltaic manufactures seek to build highly automated, efficient plants, similar to the integrated circuit and flat panel display fabs that have already changed how people live, the ability of large-scale manufacturing companies to commercialize innovative solar technologies will play an intricate role in the future and bring a new type of partnership to this industry. Dr. Charles Gay was named corporate vice president and general manager of the Solar Business Group at Applied Materials in 2006. An industry veteran with over 30 years of experience in the solar industry, Dr. Gay is responsible for establishing and building Applied Materials’ solar business. Dr. Gay is also a co-founder of the Greenstar Foundation, an organization that delivers solar power and internet access for health, education and microenterprise projects to small villages in the developing world.