- First Solar will be expanding its annual CdTel thin film solar module production capacity by 3.3 GW DC
- It will be realized for $680 million investment in the form of its 3rd US based factory, adding to the existing 2, also in Ohio
- The company will expand its total production capacity to 6 GW DC once the 3rd factory is online in H1/2023
- It will enable the company to lower the cost per W and lead to higher efficiency, while ensuring it will guard against global ocean freight challenges
Domestic solar PV manufacturing in the US, riding on the Made in America sentiment, is set to increase by 3.3 GW, world leading CdTe thin-film module maker First Solar said. It will add this capacity to produce an ‘enhanced thin film PV module’, expanding the company’s existing CdTel thin film solar module production capacity to a total of 6 GW DC when completely operational. The company claims it will be the largest fully vertically integrated solar manufacturing complex outside of China once online in H1/2023.
To manufacture the upgraded technology to its existing Series 6 generation of modules, the new fab will come up on 1.8 million sq. ft. facility in Ohio. The modules will cater primarily to the utility scale solar market in the US. .
First Solar CEO Mark Widmar said the new facility will represent a ‘significant leap forward in photovoltaics manufacturing’ while leading its manufacturing fleet in delivering the ‘highest efficiency and wattage, and the lowest cost per watt’. Philip Shen of Roth Capital Partners believes this new technology to have higher efficiency and large form to enable lower BOS costs.
The American manufacturer explained that the additional production capacity is also expected to help mitigate the challenges currently being experienced in the global ocean freight market, by reducing the transoceanic gap between international supply and domestic demand.
An investment of $680 million to be made through the company’s own existing cash resources for what First Solar promises to be one of the most advanced solar manufacturing facilities of its kind in the solar industry, it will have industry 4.0 architecture to produce higher degree of automation, precision and continuous improvement. The investment would imply $0.20 per W capital expenditure.
“This implies a 20.6c/W capex cost ($680mn / 3.3GW = 20.6c/W), which is ~30% less than the ~30c/W cost for its most recent expansions in Malaysia and Vietnam,” calculate Roth analysts.
The new fab will add to the company’s 2 already existing production facilities in Ohio, as the 3rd manufacturing base in Lake Township, Ohio. Further capacity expansion is on cards as it evaluates opportunities, but won’t tell if it will be within the US or in other international markets. First Solar also operates factories in Vietnam and Malaysia.
“Looking forward, strong demand for Series 6, a compelling technology roadmap, a strong balance sheet, and a largely fixed operating expense cost structure, are each catalysts as we evaluate the potential for future capacity expansion. While we have made no such decisions at this time, we are continuing to evaluate the potential for further domestic and international expansion,” added Widmar.
Construction of the new fab is ‘contigent upon permitting and pending approval of various state, regional and local incentives’.
The company had previously stated in its Q1 financial results reporting that it had been considering India as a strong contender for its newest and most advanced fab (see First Solar’s Q1/2021 Annual Revenues Up By Over 50%).