“EMCORE Deploys First Concentrator Solar Photovoltaic System in China with the XinAo Group” attracted my attention the week before Thanksgiving Day. It took two weeks to confirm the 50 kilowatt (kW) test and evaluation system installation from EMCORE Corporation (NASDAQ:EMKR) is located somewhere near the XinAo Group Head Office (web address found on ENF.cn) in Langfang, Hebei Province, China, about 50 km (kilometers) southeast of Beijing.
As in the past, this EMCORE Concentrator PhotoVoltaic (CPV) installation is more about developing a strategic partnership than implementation of a practical CPV demonstration system. Hebei Province is not among the Suitable Locations for CPV systems although northwestern China does have sufficient Direct Normal Irradiance (DNI) to make existing CPV systems practical. In the press release, EMCORE said:
EMCORE and XinAo continue to have discussions regarding the possible construction of a joint-owned plant in China, to manufacture CPV systems designed and certified by EMCORE for its innovative coal gasification project and the Chinese market.
The same XinAo Group press release continues with many unrelated or forward-looking statements from EMCORE:
- In early October, EMCORE was also granted access permits for its 850-kW commercial solar park installation in the Extremadura region of Spain.
- In addition to these two deployments, EMCORE expects several other pilot sites to be deployed by the end of the year.
- EMCORE continues its investment to develop a next-generation system design with enhanced performance (including a module efficiency of approximately 30%) and much improved cost structure. The new design (Generation III) is scheduled to be in volume production by the second half of calendar 2009.
- EMCORE has recently responded to several RFPs from public utility companies using Gen-III products as its baseline and expects to receive positive feedback on these proposals before the end of 2008.
EMCORE’s trumpeting of large, low quality customer CPV deals such as with Green and Gold Energy (please see EMCORE’s Investor Presentation Slides 10 to 12 from the Piper Jaffray Cleantech & Renewables Conference or “EMCORE Receives $39 Million in New Orders for Concentrator Solar Cell Receiver Assemblies from Green and Gold Energy”) has resulted in a spate of shareholder class action lawsuits against the company beginning on Christmas Eve.
|From EMCORE at the 2008 AeA Classic Financial Conference
The earlier November 3, 2008, EMCORE presentation at the AeA Classic Financial Conference made the following Spanish CPV project claims without update as 2008 closes:
- Extremadura (0.85MW in 2008)
- Completed construction and connected to the power grid in September 2008 (Ed. Note: this conflicts with the permit statement above)
- ISFOC (0.3MW in 2008)
- Shipped all modules, construction and connection to complete by December
- SolarIG (0.1MW in 2008)
- 100-kW pilot modules shipped and installation scheduled to complete by end of November
Despite mixed trade press:
- “Emcore Suffers Setback After Great Fiscal Year but Remains Cautiously Optimistic” by CompoundSemi News
- “Demand “drops off a cliff” at Emcore” at compoundsemiconductor.net
- “Emcore revenues shrink 20%, driven by PV order push-outs” at Semiconductor Today
the “EMCORE Corporation F4Q08 (Quarter End 9/30/08) Earnings Call Transcript” at Seeking Alpha did not provide any near term drivers for EMCORE’s Terrestrial Solar business. Uncertain solar incentive or tax policies in Spain and the United States combined with the credit crunch to slow project schedules and push out deliveries during the quarter. EMCORE CEO Hong Q. Hou said:
With a considerable investment in the solar cell components we have a build capacity of approximately 250 megawatt cells to receivers and 1,000X concentration.
However, this Terrestrial Solar Cell and Receiver capacity may exceed credible CPV demand in 2009 by a few times before accounting for production by III-V Multijunction Terrestrial Solar Cell rivals Spectrolab and AZUR SPACE Solar Power GmbH.
On the CPV System side, EMCORE has written off Gen-II products in favor of Gen-III product under development and expected to enter production in the second half 2009. Mr. Hou said:
In an effort to improve the market competitiveness of our CPV system product we have increased our engineering effort for the next generation CPV system design and qualifications. The cost for our Gen-III product is targeted at $1.75 per watt with a module efficiency of 30%. Even with the price erosion of solar modules, we still expect the Gen-III product to be very competitive.
In effect, EMCORE will not be able to deploy large CPV systems for at least the first half of 2009 until Gen-III is ready and in production. Any increase in Terrestrial Solar revenues for the next three quarters will have to be generated by solar cell and receiver module sales. And crystalline silicon module pricing will be an attractive alternative to CPV systems if prices drop by 20 to 30 percent per Watt in 2009 as predicted (see “Suntech CEO: Solar Panel Glut to Slash Prices by 30% in 2009” by Josie Garthwaite at Earth2Tech for example).
If the past (“Gen 3 Solar changes name to OptiSolar”) is a key indicator, EMCORE’s Gen-III designation for their next generation CPV systems is almost certain to cause a trademark conflict with DayStar Technologies (NASDAQ:DSTI).