SolarWorld is Expanding to Triple Capacity of Production in Camarillo

By Allison Bruce, Ventura County Star, Calif.

Jul. 8–Solar World, marking 30 years of existence, is benefitting from the solar boom, expanding its line in Camarillo to the tune of $20 million.

Solar panels are not only easier to make these days — with solar cell production 200 times faster than 30 years ago — but they’re also a lot easier to sell.

Raju Yenamandra has seen the changes firsthand. He started working in the solar industry in the 1970s. Now, Yenamandra is the sales manager for North America for SolarWorld Industries America, which is undergoing a $20 million expansion to triple the capacity of the company’s solar module production in Camarillo.

The company’s module production capacity is expected to grow from 35 megawatts to 100 megawatts a year by 2008. Production capacity of 100 megawatts equates to about 580,000 solar modules.

“Today the industry is robust, vibrant and growing,” Yenamandra said.

SolarWorld is already the largest solar manufacturer by production volume in the United States. And its parent company, SolarWorld AG, is among the top three solar companies in the world.

Yenamandra said there has been a “sea change” in the solar industry.

In the mid-1970s, solar cells were a product looking for a market. Solar technology came from the aerospace industry, and companies were trying to figure out how to market them.

“It took a great deal of effort to sell them and a greater effort to manufacture them one at a time,” Yenamandra said.

People were unfamiliar with solar cells and didn’t know how they could be used or how reliable they were, he said. Making a sale took a lot of education.

Yenamandra explained how each solar cell in a panel from the late 1970s was handmade. Workers had to take each cell, clean it and screen-print conductive materials on both sides.

It used to take from three to four minutes to make a solar cell, compared with today’s production line methods that churn out 50 cells per minute.

Many of these tasks are now automated, allowing the Camarillo plant to increase capacity without increasing its work force of 350 employees.

In the past, two-thirds of the solar panels made in Camarillo were exported for sale. Today, about 80 percent of the panels are sold in the United States.

SolarWorld competes with other solar companies that manufacture abroad because of cheaper production costs and import into the United States.

“We believe, if you do it efficiently, you can manufacture the product in the U.S. and be competitive in the world,” Yenamandra said.

SolarWorld, which acquired the Camarillo facility with its purchase of Shell Solar about a year ago, sees the value of investing in the company, Yenamandra said. SolarWorld has moved its sales office from San Diego to Camarillo. The office handles all sales in the United States and Latin America.

SolarWorld’s focus on solar energy — as opposed to the more diversified Shell and previous owners ARCO and Siemens — means a better understanding of the business, said Gary Barsley, director of commercial projects for SolarWorld Industries America. It also means that the company has long-term agreements with silicon suppliers and has some of its own silicon supply.

SolarWorld has its own silicon recycling operation, 10-year supply contracts and two silicon production joint ventures, according to a report from Citigroup Research. Many solar companies, Shell included, have struggled to get the silicon necessary to create solar cells to meet growing demand.

Installation of solar photovoltaic systems reached a high of 1,744 megawatts in 2006, up 19 percent from 2005, according to Solarbuzz, which follows the solar power industry. Global industry revenue reached $10.6 billion last year.

Germany, where SolarWorld AG is based, makes up 55 percent of the world market for solar power. The United States makes up 8 percent. In 2006, the U.S. market grew 33 percent.

The new machines in Camarillo will make module production faster and more reliable, said Gil Duran, an engineer who showed a group of people the process during the open house.

The facility operates 24 hours a day, seven days a week. Workers are scheduled for 12-hour shifts. The site puts out about 600 solar panels each day.

SolarWorld’s first quarter sales in the U.S. posted a double-digit increase over the previous year. The company expects a sales growth rate of more than 40 percent this year in the U.S.

“We think solar is about to become a mass market product,” Barsley said. “The overall market is expanding, and there is a shift toward larger systems.”

While large, 1 megawatt systems were once very rare, there are now quite a few, he said. The future might bring even larger systems.

Barsley said many solar companies are growing in response to programs such as the California Solar Initiative, which offers rebates to people who buy solar power systems. High energy costs and concerns about global warming also have increased interest and demand for solar power.

To meet increased demand, SolarWorld isn’t just expanding in Camarillo. The company recently announced plans to build the largest U.S. solar facility in Hillsboro, Ore.

The company plans to invest about $400 million in the site, which was originally built by a Japanese company to produce silicon wafers. SolarWorld bought the site for $40 million. Eventually, most steps of SolarWorld’s solar cell production in the U.S. will take place at the new site. Camarillo, which now handles most of those steps, will focus on creating solar cell modules and distribution.

Both expansions bring SolarWorld closer to its goal of producing solar products equalling more than 1 gigawatt of power a year by 2010.

Several German analysts have put “buy” ratings on SolarWorld AG’s stock, focusing on the changes the company is making in the United States and a better silicon supply. In May, Citigroup Research maintained a “hold” rating on the stock but acknowledged that the company had a better outlook than originally anticipated.

“Since the U.S. market is likely to develop into an important pillar of future solar installation growth it is good to see that SolarWorld has its feet firmly on the ground there,” the analysts wrote in the report.

SolarWorld’s commitment to Camarillo is viewed as a big plus.

Camarillo Mayor Jan McDonald said it is an important time to have a business such as SolarWorld based in Camarillo as more people look for alternative energy sources.

Though some of the manufacturing will move to Oregon, the business is expanding more technical work here, which is good for the area, she said.

There was some concern when the business was purchased that SolarWorld would move the operation elsewhere. At the company’s 30th anniversary celebration in June, McDonald applauded the company for staying.

“We were so happy and relieved they decided to leave that portion of the business here in Camarillo,” she said. “Anytime you have a business of that size that’s growing, it’s important for the economy of the city.”

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