Evergreen Solar signs manufacturing agreement with Jiawei Solar for Chinese solar panels

31 July 2009

Solar technology company Evergreen Solar, Inc. has finalised its agreements with Jiawei Solarchina Co., and the Wuhan Government’s Hubei Science & Technology Investment Co.

As part of the deal, Evergreen Solar will manufacture String Ribbon wafers at a leased facility being built by Jiawei in Wuhan, China on Jiawei’s campus. Jiawei will convert the String Ribbon wafers into Evergreen Solar-branded panels on a contract manufacturing basis.

HSTIC will provide Evergreen Solar $33m of 7.5 per cent financing, which Evergreen Solar must repay no later than July 2014. Jiawei will make a similar investment for its cell and panel operations with the support of HSTIC.

Evergreen Solar will reimburse Jiawei for its cell and panel conversion costs, plus a contract manufacturing fee. The actual price paid to Jiawei will be negotiated annually. Evergreen Solar will also invest $17m in cash and equipment in the Wuhan String Ribbon operation.

Initial capacity will be approximately 100MW. Factory construction has begun and the parties expect that wafer, cell and panel production will begin in the spring of 2010, according to a statement. The parties intend to expand production capacity of their respective manufacturing operations to approximately 500MW by 2012, the timing and extent of any potential expansion will be determined in 2010.

Evergreen Solar and Dynamic Green Energy, Jiawei’s parent company, have agreed to exchange warrants representing 1 per cent of their outstanding shares. These warrants will have a five-year term and may be exercised for 20 per cent of the warrant shares for each incremental 95MW of production capacity achieved.

Richard M Feldt, chairman, president and CEO, said, ‘As we reach the 25 MW quarterly capacity by the end of 2010, we expect total manufacturing costs of our String Ribbon panels produced in China to be in the range of $1.40 per watt to $1.50 per watt with both companies working aggressively to further improve technological performance as well as reduce manufacturing costs. Our mutual goal is to drive conversion efficiency and manufacturing performance so that panels are produced at the $1.00 per watt level by no later than 2012.’

Jiawei Solarchina, through its subsidiary Jiawei Solar (Wuhan), is a fully integrated manufacturer of solar products serving OEM and ODM customers around the world, including SunPower Corporation.

Hubei Science & Technology Investment is a state-owned investment company focusing on science and technology development with registered capital of approximately $410m.

Earlier this week, Evergreen Solar announced that it had formed a partnership with the Export-Import Bank of the United States to provide low-interest financing for solar projects using Evergreen Solar panels outside of the US.

Copyright © 2009 NewNet

Tags: solar

This story was published on Friday, July 31st, 2009 at 9:54 am and is filed under Asia, North America, deals, solar. You can follow any responses to article entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Leave a Reply