Japan’s Showa building third CIS solar plant, targets First Solar

Showa Shell Solar Co. plans to build a third thin-film PV cell plant in Miyazaki Prefecture and increase its output of CIS solar cells more than tenfold, in a bid to boost its solar profile and challenge market-leading First Solar.

September 9, 2009 –  Showa Shell Solar Co. plans to spend ¥100 billion (US $1.07B) to build a third thin-film PV cell plant in Miyazaki Prefecture and increase its output of CIS solar cells more than tenfold, according to local reports.

The project will involve buying an idle plant and 400,000 sq. m of land in Kumitomi, Miyazaki Prefecture, from Hitachi Plasma Display Ltd. and installing manufacturing facilities there for its copper-indium-selenium (CIS) PV modules, according to Kyodo and Nikkei news reports. The new plant will have maximum capacity of 900MW/year upon completion in July 2011 — twice the size of Sharp’s new 480MW site being built in Sakai, points out the Nikkei Business Daily — and boosts the company’s total output capacity to 1GW. About half of the anticipated 800 workers for initial operations will come from Hitachi.

Showa already operates two facilities in the prefecture producing 80MW/year of solar cells; the second site started up in June. Conversion efficiency is currently around 10%, but with production improvements it has tested up to 15.7%, “on a par with polycrystalline silicon,” according to senior managing executive officer Shigeaki Kameda, quoted by the Nikkei Business Daily.

The new site represents “a major stepping-stone for the expansion of our new energy business,” a big part of its plan to increase its marketshare to 10% in five years and contribute half its projected ¥100B pretax profit by 2014, according to company president Jun Arai, quoted in a news conference by the Nikkei. Showa Shell Chairman Shigeya Kato added that the company is also mulling a fourth and fifth plant, depending on market demand. And Kameda noted that the company “has a clear strategy to beat” US-based market leader First Solar.

In broader terms, the project also represents “an effective declaration of independence” by Showa Shell Sekiyu KK from parent Royal Dutch Shell Group “and a shift from oil to solar operations,” noted the Nikkei Business Daily, pointing out that it will conduct operations separately and build its own sales networks.

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