Just two years after scooping up Enron Wind, Industrial heavyweight GE Energy is now officially in the solar energy business after completing its acquisition of most of the U.S. business assets of the beleaguered AstroPower solar company.Atlanta, Georgia – April 2, 2004 [SolarAccess.com] Based in Newark, Delaware, AstroPower was once a major player in the solar photovoltaic (PV) market but experienced a steady decline since last year when failures to disclose financial statements resulted in a Nasdaq delisting, and plummeting stock value. AstroPower had filed a Chapter 11 petition for bankruptcy on February 1, 2004 to allow for the sale of its assets and to meet other obligations. The transaction with GE was subject to competitive bidding and Bankruptcy Court approval. These procedures were completed on March 12, 2004. But as they say, when one door closes, another one opens somewhere else. The silver lining in the company’s demise however, is that GE’s interest in AstroPower can be construed as a vote of confidence. “We see the GE purchase of AstroPower’s assets as further proof that the boom years for solar are just beginning,” said Glenn Hamer SEIA, Executive Director of the Solar Energy Industries Association. “GE joins a roster of great companies that are bringing solar to the mass market. Clearly, GE has seen the explosive growth rates of our industry, and has decided it could be a profitable business for them.” AstroPower was once one of the solar industry’s most respected and successful companies, having developed, manufactured, marketed and sold a range of solar energy products including solar cells, modules and panels, as well as its SunChoice pre-packaged systems. Their solar modules can be found around the globe on all types of projects. So what does a market development like this mean for an average solar PV installer? “What this really highlights is how difficult it is to succeed as a startup in the upstream (i.e. technology R&D) market for solar,” Harris said. He added that the PV market is a conservative one with customers and channel players demanding strong financial wherewithal in addition to technical performance. Time to market is long, building trust in the sales channel is hard, and just having a better PV module doesn’t guarantee success. “For AstroPower, this is the end. For GE, it’s a new platform on which to build a business,” said Arno Harris, president of Prevalent Power, a solar installation firm based in Novato, California. “In the big picture, it’s the wonderful creative-destructive forces of capitalism making sure that things of value are preserved while wasteful and inefficient ones are discarded.” It’s also not a huge bet for GE Energy – $15 million accounting for roughly half a day of earnings for the industrial giant. “GE’s purchase simply means that they think the value of the assets of Astropower are worth more than $15 million,” Harris said. “And, that they can apply the assets to another business to make money.” In that sense, it’s a vote of confidence in the technology and processes that AstroPower developed, Harris said, but he doesn’t necessarily think the purchase can be seen as a vote of confidence in Astropower as a company. “Presumeably, Astropower spent a lot more than $15 million developing the assets that GE is buying and as a business, they failed,” Harris said. “It’s important to keep this deal in perspective,” Harris said. “$15 million is very small amount of money — a rounding error almost–for GE. This isn’t a big or risky bet for them. So, I don’t think it really says a lot about their confidence one way or the other about solar. It just means that they think they can generate a decent return on their investment.” Maybe it barely stacks up to a rounding error that can turn over a balance sheet profit, but GE Energy appears quite confident in growing their solar business with Astropower as a jump-off point. “Solar power has great potential, since solar cells can be utilized almost anywhere,” said John Rice, president and CEO of GE Energy. “It already is a cost-effective source of power in many remote, off-grid locations, and as system costs come down (over the next few years), we expect demand will increase for on-grid residential and commercial applications.” With respect to GE’s earlier acquisition of Enron wind, it has been said the company doesn’t enter a new industry unless they plan on being a top player. And they have certainly proved that with their wind power division. GE Energy’s solar business will remain headquartered in Delaware. Ali Iz has been appointed the business leader of the new organization with the majority of AstroPower’s current employees being transferred to GE. “Adding the resources of AstroPower to GE Energy’s line of renewable energy power generation options supports our on-going commitment to provide customers with the broadest possible range of energy solutions for the 21st century,” Rice said. Solar joins wind, hydro and other renewable energy technologies now in the GE Energy portfolio. The company entered the wind power industry in 2002 with the acquisition of certain assets of Enron Wind, and since then GE’s wind energy operations have grown into a $1.3 billion business. While wind – and now solar – are relatively recent additions for GE Energy, the company has supplied equipment and services to the hydropower and water control industries for more than a century. GE also continues to expand its technology portfolio supporting the use of alternative fuels such as biogas and landfill gas, while improving the efficiency and performance of coal, geothermal and gas turbine-based power plants.