Sharp becomes an Independent Power Producer (IPP) through JV with Enel to build utility scale solar plants

Solar Leader Sharp is shifting its Focus from Crystalline Solar to Amorphous Silicon Thin Film Technology.Sharp has been the largest solar company by revenues since the last 3-4 years though its marketshare has eroded due to competition from Chinese solar companies.In volumes,Cd-Te leader First Solar has already overtaken Sharp while Suntech,Yingli,Trina are also fast catching up as the Chinese displace the Japanese in global solar rankings.Sharp’s c-Si business is not cost competitive with the company making very low margins despite much higher ASPs.It has been increasing outsourcing from Taiwanese solar cell companies in order to reduce costs.However that remains a losing strategy for Sharp despite its premium quality reputation.The company has decided to increase the focus on amorphous Silicon (a-Si) Technology building a massive  1 GW plant in Sakai.It has recently won orders in Italy and USA to supply a-Si modules made in this Japanese factory.

Sharp further boosts a-Si investments through JV with Enel to build solar plants

Sharp alongwith STM and Enel is building a 160 MW factory in Italy in an unused STM fab to manufacture a-Si modules using Sharp technology.This plant which is getting a Euro 49 million grant from the Italian government will ultimately manufacture 480 MW modules per year.Alongwith this JV between these 3 companies named 3Sun,Sharp is also entering the Independent Power Producer (IPP) business.It has formed a 50:50 JV with  Enel Green Power’s to build power plants using these a-Si modules in the EMEA region.This JV has set a target of 500 MW of solar installations in the next 5 years.Note amorphous Silicon technology has received a major setback with Applied Materials exiting its SunFab  a-Si equipment manufacturing.Sanyo which had ambitious plans to ramp up a 1 GW capacity using a-Si technology in a JV with Nippon Oil has also shut shop.It remains to be seen whether Sharp can make a success of a-Si technology.a-Si technology has much lower efficiency in the range of 7-9% compared to the mainstream crystalline solar technology.a-Si cost advantages over the c-Si technology has also disappeared with falling polysilicon costs.This makes a-Si only feasible for utility sized plants as a-Si’s larger area requirements makes unsuitable for residental and commercial segments.The IPP JV is a good move as it will provide captive demand for Sharp’s a-Si modules.

Establishment of Joint Venture for Production of Thin-Film Solar Cells in Italy and Independent Photovoltaic Power Generation Business in the EMEA Region – MarketWatch

In addition, on July 22, 2010 Sharp and EGP have established Enel Green Power & Sharp Solar Energy S.r.l (hereinafter, ESSE), a joint venture of the two companies that will be engaged in the independent power producer (IPP*4) business to develop, build and operate photovoltaic power generation plants.

ESSE will establish power generation plants with a total power generation capacity of more than 500 MW by the end of 2016. ESSE will use the thin-film solar cells produced by the 3Sun plant in Catania, and extend its IPP business to Europe, the Middle East and Africa with a focus on the Mediterranean area. Thin-film solar cells are suitable for large-scale photovoltaic power generation, especially in the Mediterranean areas including Southern Europe (EMEA). As compared to silicon type solar cells, the thin-film solar cells are able to maintain their conversion efficiency even in hot climates.

Through collaboration with a power company, Sharp aims to become a total solution company in the photovoltaic field, initiating the world’s first business model extending from thin-film solar cell production to IPP business.

Overview of Joint Venture Company for Thin-Film Solar Cell Production

Company name:          3Sun S.r.l.
Company location:      Catania, Sicily Region, Italy
Date of establishment: July 30, 2010
Investment ratio:      Sharp 33.33%, EGP 33.33%, ST 33.33%
Plant location:        Catania, Sicily Region, Italy
Start of operations:   The second half of 2011
Production item:       Thin-film solar cells
Annual prod. capacity: 160 MW (initial phase)

Overview of Joint Venture Company for Independent Photovoltaic Power

Generation Business

Company name:          Enel Green Power & Sharp Solar Energy S.r.l.
Company location:      Rome, Lazio Region, Italy
Date of establishment: July 22, 2010
Investment ratio:      EGP 50%, Sharp 40%,
                       Sharp Electronics (Italia) S.p.A.*5 10%
Power plant location:  Europe, the Middle East and Africa with a focus
                       on the Mediterranean area
Power gen. capacity:   Total of more than 500 MW by the end of 2016