Founded in Norway in 1996, REC is a vertically integrated player in the solar energy industry, employing more than 3,900 people worldwide with revenues close to NOK 14 billion in 2010. Ranked among the world’s largest producers of polysilicon and wafers for solar applications and as a rapidly growing manufacturer of solar cells and modules, REC also engages in project development activities in selected PV segments.
Ole Enger, President and CEO of REC, discusses the company’s competitiveness and where it’s putting its efforts to survive and thrive in this very challenging market environment.
Reported by Jeanny H. Lim (email@example.com)
REC is a leading vertically integrated player in the Photovoltaic (PV) industry. Why has REC chosen to enter the PV market?
REC has focused solely on solar from our beginning in 1996 when we started wafer production in Norway. Our founders were pioneers in the industry who saw an opportunity to build on Norway’s experience in metallurgical processes and the availability of hydropower to produce wafers. We saw the potential of solar from the beginning.
What are your keys to competing in a saturated solar cell and module market? What have you been doing to make your technology stand out from the crowd?
We have focussed our efforts on operational excellence, which means delivering high performing products while achieving the cost reduction required to be competitive. As a vertically integrated company, we can control quality throughout the value chain from silicon through to cells and modules. Our modules are leading for power output in the Photon field performance test, have an industry leading energy payback time of one year and a light carbon footprint. We have also grown our sales and marketing and technology organizations to make sure that we are delivering added value to our customers.
Could you give us an update on your polysilicon and wafer businesses?
Our strong silicon operation in the U.S.A. is showing good results and we are very pleased with the proprietary Fluidized Bed Reactor technology we have brought to scale. This gives REC the leading cost position for silicon production. Due to the weak market conditions, like many producers, we have reduced wafer production in Norway. Singapore wafer produciton operates at full capacity.
How do you evaluate your performance in 2010 and 2011 and how much growth do you expect for 2012?
In 2010, REC focused on ramping up both our wafer, cell and module capacity in Singapore as well as our silicon production. REC revenues increased by 56% in 2009 and we are pleased with the operational performance during ramp up of the new capacity. While we are optimistic about the longer term, the market conditions in 2010 and 2011 were challenging which will of course impact the revenues of REC and many others in the industry. And we expect the coming one to two years to also be difficult. But REC is well positioned for the long term given our strong silicon and module production and high-performing products.
What is your priority in 2012, business-wise and technology-wise?
We will continue to focus on operational excellence building on the progress we have seen last year in our strong silicon production in the U.S. and integrated cell, wafer and module production in Singapore. We will also continue to invest in our research and development and sales and marketing organization.
What does your plan for future expansion look like?
REC is evaluating how best to build on our existing asset base, and evaluating potential expansion of our FBR silicon facilities. The utilities and infrastructure required are available if we choose to expand wafer, cell and module production in Singapore. REC is also prepared to pursue strategic alliances as appropriate to increase our PV production capacity depending on market conditions.
Please introduce some of the recent and successful solar projects you’ve carried out.
REC Systems has together with partners successfully completed 27 MWs of ground-mounted photovoltaic power plants in Italy. REC recently supplied our largest installation ever of 28 MW on a former military base in Germany with Solar Konzept which will meet the energy needs of up to 32,000 inhabitants and save about 18,200 tons of CO2 per year. REC modules were also recently installed on several IKEA rooftops throughout the U.S.A. We are also growing our customer base in Australia, India and Japan.
Recently, governments around the world, especially in Europe, have slashed subsidies for solar. What has the impact of that been so far for REC?
Cutting subsidies is necessary for solar to become an even more competitive source of energy. Long-term visibility and a clear and predictable policy framework are needed to make sustainable growth possible. REC has focused on reducing production costs without compromising product quality. It is important to mention that almost all other energy sources continue to be subsidized and that putting a price on carbon emissions would help to make the real costs of energy clearer to policymakers and to consumers.
What’s next at REC as you strive to improve your technologies and drive solar power innovation?
Building a better understanding of customer needs by getting closer to the markets is key. We will continue to focus on scaling up our FBR silicon technology, improving wafer quality and the performance of REC modules by investing in research and development and product development where we are engaged in activities globally.
What are your expectations for the development of the PV market in 2012?
We expect continued oversupply on the polysilicon and module side but are expecting to see new markets particularly in Asia growing as solar becomes more cost competitive.
Jeanny H. Lim is Editor-in-Chief of InterPV. Send your comments to firstname.lastname@example.org.
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