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Building a complete manufacturing eco-

system in India

November 10,2011

Madhavan NampoothiriEnergy Alternatives India


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Has India missed the chance to

become a PV manufacturing super-power?


3/14

Overview

Global PV manufacturing - Where does India stand today?

Crystalline Silicon(Polysilicon to modules)

Thin Films Balance of Systems(Inverters)

PV Manufacturing Equipment

What are the challenges to become a serious player?

Is policy support sufficient to make that happen?


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Solar PV The evolution..Annual Installations Annual production - Modules

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: EPIA

EU

Rest of the

World

China/Taiwan

Japan

USA

0%

10%

20%

30%

40%

50%

60%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: EPIA

China/Taiwan

EU

Japan

USA

Rest of the

World

Cumulative Global Installations(2010):

Europe30 GW (over 75%)

India About 30 MW (less than 0.1%)

Share of global PV Production capacity(2010):

China more than 50%

India Less than 5% (in modules)


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Global PV Manufacturing : Charging ahead!!

C- Silicon

40.0

54.0

28.2

41.5

32.9

47.3

36.7

52.3

0

10

20

30

40

50

60

2010 2011

Capacity(GW

)

PolySilicon Wafer Cell Module

Thin Films

Source: iSuppli(May 2011)

India:1.2 GW

China:

20 GW

Source: GTM Research(May 2011)

India:

0.6

GW

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

2009 2010 2011

Capacity(GW

)

CdTe CIGS a- Si

60 MW

(a-Si)

China:

16 GW

Moser Baer

HHV

Shurjo


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Global Inverters manufacturing: Not left behind..

0

5

10

15

20

25

30

35

40

45

2009 2010 2011

Invertor capacity(GW) Installations(GW)

SMA-40%

Market

Share

SMA-40%

Market

Share

SMA-35%

Market

Share(E)

Indian Scenario

SMA

Power One

Kaco

Fronius

REFUsol

Satcon

Danfoss

Solarmax

Delta

Advanced Energy

Top Global Inverter Manufacturers

Inverter Production Capacity vs. Solar PV Installed Capacity

AEG

Delta Electronics (WIP)

DB Electronics


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PV Manufacturing equipment : European

domination continues..

HHV in India

Rank Company Revenues($Million)

Country

1 Applied Materials 1495 USA

2 Centrotherm Photovoltaics AG 825 Germany

3 GT Solar Incorporated 775 USA

4 Meyer Burger^ 735 Switzerland

5 Gebr.Schmid GmbH+Co 570 Germany

6 Ulvac, Inc. 380 Japan

7 Roth & Rau AG* 325 Germany

8 RENA Sondermaschinen GmbH 300 Germany

9 48th Research Institute of CETC 295 China

10 Oerlikon Solar 195 Switzerland

^ Second after acquisition of R&R

* To be acquired by Meyer Burger

R&R sold CdTe coating division to undisclosed Chinese buyer

List includes both c-Si and Thin Film capacities

Source: VLSI Research


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Indian PV manufacturing The challenges

Financial

Operational

Market


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Highlights:

- Commodity manufacturing(almost)

- Standard off-the-shelf technology available

Key success factor:

Lead times in commissioning a unit

Utilization rates

Infrastructure(ex. electricity)

$4.25

$2.60$2.20

$1.20$1.00$0.70$0.45$0.21

$-

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

2008 2009 2010 2011(Q4) 2012(ASP

Estimate)

Module($/W) Cell($/W) Wafer($/W) Polysilicon($/W)

Market Challenges Dramatic price dropsManufacturing Operations

Investments and returns

Excess

capacity

45.0%

30.0%

37.0%

8.0%

26.0%

4.0%

3.0%

0.3%

17.0%

60.0%

52.0%

89.0%

10.0%

4.0%

5.0%

0.7%

0.0% 20.0% 40.0% 60.0% 80.0% 100.0%

Polysilicon

Wafer

Cell

Module

Capex Depreciation Electr icity Materials Labor Cost Others

Poly Silicon Ingot &

Wafer

Cells Module

Investments/MW

Medium Medium High Low

Optimum

production

scale

Very High Medium Low Very Low

Margins High Medium Low Low

Cost DriversC-Si


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Highlights

- R&D intensive, not commodity manufacturing

- Standard production technology not available

- Successful CdTe manufacturing techproprietary

Success factors

Lead times

High R&D

Sourcing of rare earth metals/raw

materials

Market challengesManufacturing Operations

Investments and returns Cost Drivers

- Narrowing gap with c-Si

- Lower conversion efficiency

- a-Si : limited efficiency upside

- Cadmium : a carcinogen

- CIGS : Not cost competitive yet

0 20 40 60 80 100

a Si

CIGS

CdTe

Raw material and consumables Capital Depreciat ion & amortizat ion

Energy Labour

Research & Development Others

a- Si CdTe CIGS

CapitalInvestments

High Medium High

Optimum Scale

of Investment

Low Low Low

Thin

Films


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Policy support for Manufacturing

Chinese Advantage Low interest loans (4.8% in Jan 2011)

No principal or interest payments for

first 5 years

Scale of loans much higher (over 60% of

CAPEX funded)

Local content mandated for

manufacturing

India

- Local content requirement under

JNNSM

-Incentives under Rajasthan policy

- Duty exemptions

Ontario, Canada

- Local content

requirement

USA

-Sunshot Initiative

-- DOE loans(eg. Solyndra)

Italy

- 10% higher FiT

for made in EUChinese Advantage

Low interest loans (4.8% in Jan 2011)

No principal or interest payments for first 5 years

Scale of loans much higher (over 60% of CAPEX

funded)

Local content mandated for manufacturing


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How can we get around the

challenges? Shammy Khan, VP Strategic Markets, Flextronics - "PV

manufacturing- Outsource vs. InSource"

Dr. VS Gangadhara Rao, Lanco Solar, "PV Manufacturing

Technology Options

Prasanth Sakhamuri, HHV Solar, "The case for equipmentmanufacturing in India - experience with thin film equipment

& lines & the potential for cost reduction

Navakrishna Akkineni, Solar Semi, "Experience with IndianManufacturers Strategy & Opportunity"


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Thank You

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