IBJNews

Solar panel maker must prove low production cost

Back to TopCommentsE-mailPrintBookmark and Share

Abound Solar promises to bring a big new industry to central Indiana, but first the company has to prove its manufacturing efficiency.

Colorado-based Abound will receive $400 million in federal loan guarantees to scale up production at its Longmont facility and to add a second factory, the unused Getrag-Chrysler transmission plant in Tipton. The company says it will hire 900 to 1,200 people in Indiana, but first, it must focus on successfully scaling up its existing facility.

"It's not a demand issue," Abound Marketing Director Mark Chen said. "It's purely execution and us being able to ramp up capacity."

Venture capital-backed Abound has been in commercial production since last fall, but now plans to triple capacity in Longmont to 200 megawatts, or about 3 million panels, by the end of 2011, Chen said.

Work on the plant in Tipton would begin sometime in 2011, Chen said. Manufacturing would not begin until 2012, he said, and Abound hopes to achieve a capacity of 600 megawatts or more by the end of 2013. Chen said the company doesn't yet know how quickly it would ramp up production, or hiring, in Tipton.

Abound will compete with publicly traded First Solar, which also make thin-film photovoltaic panels using cadmium telluride. The technology is cheaper to produce than traditional silicon-based photovoltaics, but it offers less solar efficiency, said Dan Ries, managing director of the London-based brokerage Collins Stewart. Ries follows First Solar and other firms.

As the price of silicon photovoltaics drops, First Solar and its upstart competitors must become more cost-effective so they can maintain a price difference of 10 cents to 15 cents per watt, Ries said. First Solar's production cost is now about 80 cents per watt, he said, and the company predicts it will drop to about 70 cents per watt by the end of 2011.

"The thing that’s going to determine whether they go ahead or not will largely be the cost at which they can produce," Ries said of Abound's second plant in Tipton. "They’d have to see a roadmap of 80 cents or cheaper."

Abound has an option to buy Getrag's unfinished, 800,000-square-foot plant on U.S. 31 in Tipton. The seller is the group of contractors who were owed about $45 million when the project ground to a halt in October of 2008. The bankruptcy court in Detroit awarded the property to the contractor's group, led by Industrial Power Systems in Toledo.

Jerry Albrecht, president of now-defunct Moorehead Electric in Marion, said the contractor group plans to sell the property to Abound for about $25 million and the deal is supposed to close by September. Moorehead Electric was one of the largest subcontractors on the Getrag plant. "Most of the contractors will recover through this sale about 50 percent of what they're owed," he said.

Abound says it will invest $500 million in the two plants, with the majority of it spent in Tipton. The company will also receive state and local tax incentives.

The federal loan guarantee will help Abound secure a round of $50 million in equity financing from a still-unnamed party, Chen said.

Abound targets commercial-scale solar installers and electric utilities. Its main customers so far are Juwi and Wirsol, both based in Germany. Abound's panels are in use at the first "green" Burger King, a project installed by Wirsol in Waghausel, Germany.

Abound says it intends to manufacture in the United States, though most of its customers are overseas. "We believe our low-cost manufacturing technology provides such an advantage, we can produce in the U.S. and export around the world," Chen said.

Leading competitor First Solar has plants in Perrysburg, Ohio, as well as Malaysia and Germany.

Abound's process for turning a sheet of glass into a photovoltaic panel is fully automated. Chen said labor needs revolve around running equipment, handling raw materials, maintaining the plant, and quality control. 

Cadmium is a toxic heavy metal, but Chen said Abound produces no toxic byproducts or waste. Leftover cadmium telluride is sent back to the supplier, which breaks the material down to its components, cadmium and tellurium. 

ADVERTISEMENT

  • We shall see if this will ever get off the ground for Indiana
    Solar panel producer tied to Kanjorski receives $400M federal loan
    By Charles Schillinger (Staff Writer)
    Published: July 11, 2010

    Font size: [A] [A] [A]
    e-mail this share this Yahoo! Buzz
    A Colorado-based solar panel manufacturer for which the nephew of U.S. Rep. Paul Kanjorski is vice president of marketing has received a $400 million loan guarantee from the U.S. Department of Energy.

    The loan commitment to Abound Solar Manufacturing - announced by President Barack Obama during his July 3 weekly radio address - is to increase solar panel production at an existing plant in Colorado and build a second plant in Indiana that will create more than 1,200 jobs, a company statement said.

    Part of the management team of Abound Solar is the Nanticoke Democrat's nephew, Russell Kanjorski. But a campaign spokesman denied the congressman had any part in the awarding of the loan commitment.

    "His nephew works for the company, but is an executive and has nothing to do with securing federal projects, I don't believe," said spokesman Ed Mitchell. "The congressman doesn't know any of the executives of the company and has had no contact with them.

    "The congressman has also had no contact with anyone in the administration to get the (loan commitment) and that's what it comes down to," he added.

    Russell Kanjorski made headlines, along with his siblings, in 2002 when a company they owned received as much as $9 million in federal grants that their uncle helped obtain.

    That company, Plains Township-based Cornerstone Technologies, filed for Chapter 7 bankruptcy in 2006. It was created to use state-of-the-art water jet technology to pulverize materials like aluminum, coal, glass and graphite, the byproduct of which would be transformed into industrial lubricants, electronic packaging and various applications in the military defense field, as reported at the time.

    Abound Solar will use its federal loan to "produce millions of state-of-the-art solar panels," Obama said in his address. On its website, Abound Solar says it was founded in 2007 "to commercialize a proprietary process for manufacturing cadmium telluride thin-film photovoltaic modules."

    A conservative-leaning magazine, "The Weekly Standard," wrote about the link between Kanjorski's nephew and Abound Solar in its July edition, but did not indicate the congressman played any part in helping the solar panel manufacturer obtain the loan.

    Efforts to reach Abound Solar were unsuccessful Saturday evening.

    cschillinger@timesshamrock.com

  • Hey streetfighter,
    Go have another smoke and stand in front of the mirror! You see that? What an idiot! I bet you live downwind from a nuclear power plant... or a spent fuel rods holding facility!
  • mirrors that make smoke
    Responding to Streetfighter's Smoke and Mirrors: you are right. It was a lot better when W awarded GM a trillion dollar tax credit over ten years to build an empty building with no quota that had a sign on it reading "alternative energy fuel vehicles." That really worked out well for all of us, especially, those of us holding GM stock. At least the O show is using government's nature monopoly to encourage innovation - the true long lost art of america. Further, you must be completely unaware of the costs in building a nuclear power plant. This is a drop in the bucket compared to what it would take to build ten beautiful nuclear power plants - que naked gun 33 and 1/3 dog's double tail wagging.
  • mirrors that make smoke
    Responding to Streetfighter's Smoke and Mirrors: you are right. It was a lot better when W awarded GM a trillion dollar tax credit over ten years to build an empty building with no quota that had a sign on it reading "alternative energy fuel vehicles." That really worked out well for all of us, especially, those of us holding GM stock. At least the O show is using government's nature monopoly to encourage innovation - the true long lost art of america. Further, you must be completely unaware of the costs in building a nuclear power plant. This is a drop in the bucket compared to what it would take to build ten beautiful nuclear power plants - que naked gun 33 and 1/3 dog's double tail wagging.
  • Smoke and Mirrors
    The following was posted when this was announced and it has begun. Smoke and mirros.
    B.O. =B.S.
    streetfighterJuly 3, 2010 7:10 PM
    The fact is that most of our solar panels are made out of the U.S. by companies like G.E. due to lower costs. Now this government, that hasn't been able to fix anything so far is going to underwrite all these solar cells that will take care of our electrical production. Giving it away, it will still cost too much. Billions has been spent on solar research, and WHERE the hell is it at OUR level? By the time this is viable we could have five or ten nuclear plants functioning. You won't even see a blip of electical energy from solar power from this production. Costs of solar panels has been fixed at $4.50 per kilowatt hour and all the government B.S. and research hasn't brought it down one dime. For a simple water heater they are charging thousnds of dollars. After all, the great dream of B.O. to double production from one percent to two percent in ten years is nothing but pure B.S. By they time they steal all the money they can and misappropriate and just plain lose it, how many jobs are we really going to get? So much B.O. B.S. Much as we want solar to work, it isn't going to take over anytime soon. So Indiana is glad they sucked up some government largesse. Tune in five years from now.

    Post a comment to this story

    COMMENTS POLICY
    We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
     
    You are legally responsible for what you post and your anonymity is not guaranteed.
     
    Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
     
    No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
     
    We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
     

    Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

    Sponsored by
    ADVERTISEMENT

    facebook - twitter on Facebook & Twitter

    Follow on TwitterFollow IBJ on Facebook:
    Follow on TwitterFollow IBJ's Tweets on these topics:
     
    Subscribe to IBJ
    1. They can always get jobs at the Post office.

    2. Hello i am Clarisa Steve from Florida USA,when i was in need of a loan of $230,000 to transit a business my friend introduced Mark Oscar loan firm to me because she got a loan from them sometime ago, so I was so scared because of the scams in the internet but my friend encouraged me to give them a try and i gave them a try and i got my loan within 4hrs and their ways was very easy no credit check,no cosigner,no collateral and their interest rate is just 2%, so i will advice anyone out there that need a loan to contact them via their Email:(oscarloanfinance@hotmail.com).

    3. "This was a very localized, Indiana issue," he said. As in, Indiana failed to expand Medicaid to cover its poor citizens resulting in the loss of essential medical services, including this EMS company. Well done, Indiana GOP. Here are the real death panels: GOP state governments who refuse to expand Medicaid for political reasons.

    4. In the "one for all, all for none" socialist doctrine the sick die...this plus obama"care" equates to caucasian genocide plus pushed flight to cities thus further eroding the conservative base and the continualed spiral toward complete liberal/progressive/marxist America.

    5. There is a simple reason why WISH is not reporting on this story. LIN has others stations in different markets that are affiliated with CBS. Reporting about CBS blindsiding WISH/LIN due to CBS's greed and bullying tatics would risk any future negoations LIN will have with CBS in other markets.

    ADVERTISEMENT