Sun Sa­lu­ta­tions: REC has grown to be­come a world leader in clean en­ergy

Norway-Asia Business Review - - Contents -

“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.

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