Sun Salutations: REC has grown to become a world leader in clean energy
“We considered 200 locations when we were selecting a site for REC’s stateof-the-art integrated factory,” says Torgeir Ulset, Vice President, Sales and Marketing for Asia-Pacific. “We chose Singapore largely because of the talent and the country’s proficiency in semi-conductor manufacturing, which is very similar to solar cell manufacturing. Singapore’s location and logistics infrastructure is also desirable for our supply chain. In addition, Singapore’s strong commitment to cleantech innovation makes it an ideal location for REC to channel new innovations and push the boundaries for solar solutions. We are very excited to share our roadmap for advancements in solar energy production as we dedicate resources for research and development into our game-changing TwinPeak solar panels with the latest announcements. We believe that Singapore will continue to be a source of competitive advantage for us as we commit to our long-term partnerships here.”
The REC TwinPeak is REC’s latest innovation. Based on solar grade silicon, it provides high panel efficiency and power output, enabling users to get as much out of available space as possible. The panels also feature a unique “twin” design, which enables them to generate electricity even when they are partially shaded.
“We want to be a premium brand that competes on quality and cell efficiency, so as to appeal to customers in the commercial/industrial rooftop segment,” says Torgeir Ulset. “And we want every person to benefit from electricity directly from the sun. Therefore, we are continuously expanding our capacities and presence worldwide.
“In the solar industry, it’s often easy to conduct experiments in the lab, and make announcements based on these experiments. But, when it comes to mass production of such products at low costs, many aren’t able to do that. And that is where REC’s expertise is; taking those laboratory eureka moments and making it available for the masses.”
Being a fully integrated manufacturer, REC benefits from having complete control over the manufacturing process. “Through integrated manufacturing from solar grade silicon to wafers, cells, panels and turnkey solar solutions, REC strives to help meet the world’s growing energy needs. With such a proven track record, we are able to assure high performance and reliability in our products including lowest warranty claim rates – well below 100ppm over the past few years. As such, REC offers a one-stop energy solution for commercial businesses,” says Torgeir Ulset.
REC has a strong presence in Southeast Asia, with over 50 percent of regional sales in 2015 coming from Thailand. With the awareness of the importance and competitiveness of renewable energies, governments around the world are implementing or have already in place dedicated programs to incentivise a transition from fossil fuels to renewable energies. These include feed-in-tariffs, tax incentives, green certificates, tenders and auctions and net metering schemes. While most of Southeast Asia has been rather slow on getting on board with solar power, such government-led incentives have supported Southeast Asia on increasing their reliance on photovoltaic power (PV) systems in their energy mix. Vietnam and Indonesia for instance, are expected to announce new feed-in-tariff schemes for PV this year – which REC feels will be a key support to expanding its revenue.
The Singaporean government also recently announced about SGD 900 million of R&D budget in Urban Solutions and Sustainability, one of four key technology domains to be funded under the national Research, Innovation and Enterprise ( RIE) 2020 Plan. The figure includes REC’s SGD 50 million investment towards a five-year research collaboration with National University of Singapore’s Solar Energy Research Institute of Singapore (SERIS), to develop the next-generation solar panel after TwinPeak.
Other places are following suit as well. “In India, we expect annual installations to rank ahead of Japan and to approach Europe by 2019 and are therefore further expanding our local team and activities there,” says Torgeir Ulset. “The Indian government has ambitious plans for the renewable industry, for example, increasing the current installation base by five times to 175GW by 2022. And the fast growing solar power industry is a major contributor to this national target.”
REC supplies solar panel solutions to both private and corporate customers and while both groups have the same incentives for switching to solar power – saving money on the electricity bill and/or making their contribution to saving the environment – the break-up percentage is very different from market to market. In Europe, REC is seeing more and more commercials and residentials turning to solar, made more attractive by the cost reaching grid parity. “In SEA, distributed generation is almost exclusive to corporate customers with very low private residential penetration,” explains Torgeir Ulset. “This is due to mismatch between solar generation and
consumption. For a residential customer, solar generation happens in the day while usage are usually at night so in the absence of storage solution, which is still expensive today, the generation is not effectively utilised within the same roof.”
In an open letter to COP21 participants, REC called for policy action in order to maintain the momentum of solar power for a safe climate. The company argued that in order to be compatible with economic growth, renewable energy sources have to be more affordable and efficient. “Cost is [...] decreasing at an impressive rate. Of all the renewable energies, solar is getting cheaper the fastest. With photovoltaic systems now costing half what they did just six years ago, solar energy is achieving grid parity – the cost level at which solar is competitive with conventional sources of electricity – in more and more regions,”REC wrote.
With renewable energy all the rage, the question on everyone’s mind is what is the cost-benefit? There is no single costbenefit formula that fits every market, says Ulset. “The cost-benefits in general depends on a number of factors – how you finance it, federal and local incentives, your utility rate, amount of sunshine available on your rooftop,” he explains. “For a plain vanilla distributed (rooftop) solar installation without financing and incentives, the payback period will range from 6 to 10 years depending on the country’s retail electricity rates and irradiation or sun hours. In countries with low electrification rates whereby transmission cost is expensive the payback can even be further reduced. This is due to the fact that distributed, that is rooftop, solar energy is consumed where its generated so transmission cost can be saved.
“In the case of the new power purchase agreement model, whereby end users are not required to invest with any upfront installation costs, customers get to enjoy solar electricity at no cost at all – in many occasions the solar electricity rate can be competitive with retail electricity rates. This novel model has accelerated solar adoption in many countries, which in turn drives down costs further in the supply chain due to scale in demand.”
During the Norway-Asia Business Summit in Singapore, CEO of Innovation Norway, Mrs Anita Krohn Traaseth, visited REC’s facility in Singapore. She was clearly impressed with the productivity of the huge production halls, all driven by fully automated and robotic processes. “Solar energy is one of the most promising sustainable energy solutions for the future. Norwegian technology, knowhow and expertise is world class and answers many of the global challenges facing the international community”, commented Krohn Traaseth.
“Elkem is a good example of a company that has positioned itself strategically in relation to changing competitive conditions, both in terms of production capacity, cost structure, ownership and competition. As a result, the company is starting to see value creation back in Norway where it all started; with assistance from Innovation Norway and public authorities, Mrs Krohn Traaseth said.
She also noted that the Singapore plant was well positioned for a closer cooperation with Elkem Solar’s facilities in Norway. Elkem Solar will start up new production in parts of the plant in Porsgrunn, Norway, leading to green growth through development of new renewable technology and thereby creating 70-80 new jobs in Norway as well as a number of indirect jobs with a potential for further growth. Elkem Solar’s factories in Porsgrunn and Kristiansand will become part of the world’s most climate and energy efficient value chain from quartz to solar panels and thereby enhancing the integration between Elkem Solar and REC Solar and hence both companies ambition to grow. Elkem Solar is currently verifying the need for technology development and equipment upgrades. The company has sought public R&D funding and support from both local and national authorities is needed to be able to realise the project. The costs of upgrading the factory equipment is expected to be several hundred million Norwegian kroner.