A N E R AC P U B L I C AT I O N

ANALYST REPORT

China & the Future of Solar

Photovoltaic Technology:
CIGS Thin-Film Solar Cells Will Rock the Industry
Written by:
Gerri Potash, Nerac Analyst

In the Publication
Introduction.................................................................................1
Thin films are the wave of the future..........................................1
US players to watch....................................................................2
Chinese players to watch4 Rising Stars.....................................3
The Future...................................................................................6
About the Author.........................................................................8
About Nerac................................................................................8
References..................................................................................8
Introduction
New technologies for flexible photovoltaic cells show promising signs of transforming solar
power generation. Thin film photovoltaic (PV) cells composed of copper, indium, gallium, and
selenium (CIGS) use only one percent of the material used in conventional crystalline-based
silicon solar cells and are expected to prove cost-effective alternatives to fossil fuels.

China is a natural fit for the manufacturing and commercial development of CIGS solar cells: it
is the world’s most populous country, holds vast natural resources, has experienced explosive
industrialization and modernization with nearly-insatiable energy requirements, and faces
serious industrial pollution problems. In addition, the Chinese government is developing its
own stimulus plan to increase the focus on renewable energy industries. China, the world’s
second-biggest consumer of energy, now derives 80 percent of its electricity from burning
coal. The country’s alternative energy goals include boosting renewable energy to 10 percent
of total energy consumption by 2010 (and 15 percent by 2020) from 7.5 percent in 2005.

In China in 2008 there were more than 200 manufacturers of solar panels, in aggregate
accounting for nearly half of the world’s total solar power generation.[1] Although China has a
relatively strong base of solar production infrastructure and know-how, most of China’s manu-
facturing focus and documented innovation (in the limited patent portfolios held by Chinese
companies in this space) has been on production of older silicon-based cells.

Thin films are the wave of the future

While photovoltaic cells have been predominantly based on crystalline silicon technology, thin
films are now sufficiently advanced to offer significant commercial opportunity. The efficien-
cies of amorphous silicon, cadmium telluride, gallium arsenide, and copper indium diselenide
or copper indium gallium diselenide are high enough to now compete with crystalline silicon.
Analysts are projecting up to $1.3 billion in revenues for competing technologies in the thin film
space this year, such as amorphous silicon based photovoltaics, and market growth to $4.1
billion in 2014 for these types of technologies. The market potential for thin films will be real-
ized when their integrated use in roofing shingles and other building materials is more feasible
and cost-effective.

The balance between energy efficiency and cost of production is shifting as CIGS technol-
ogy advances, through a new controlled alkaline addition technique and the development of
new materials. CIGS solar cells are not as efficient as crystalline silicon solar cells, but they
are expected to be substantially less expensive once fully commercialized. The efficiency of
thin-film photovoltaics is approaching 20 percent, and new advances are expected to confer
additional improvements. [2]

There are other challenges to bringing CIGS technology into the mainstream. Current technol-
ogy leaders have found it difficult to bring high-performance flexible CIGS photovoltaic cells
to the marketplace due to their extreme sensitivity to water and the need for protective films

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that meet stringent requirements. They must be compatible with the CIGS energy conversion
process, transparent, flexible, durable, handle temperature extremes, and have life expectan-
cies of 20 years (the benchmark lifetime for roofing materials). However, with a front side
barrier technology in development at companies including 3M, Fuji, Mitsubishi, Vitex Systems
and Protoflex, the state of commercialization in CIGS cells is rapidly changing.

Another challenge inherent in PV development is resource availability, with the depletion of

traditional sources.[3] Indium, an important component of the conducting oxide used in flat-
panel displays and photovoltaic cells, is the main concern. The National Renewable Energy
Laboratory predicts constraints on indium availability once production reaches the tens
of gigawatts levels. Thomas Jansseune of Compound Semiconductor commented on the
rising prices and limited availability in 2005: “[t]he business closures and start-ups that have
been announced could trigger a shift in the supply base. Integrated manufacturers of indium
products, which have indium production and recycling in house, will be in a winning position.
For whatever application, be it InP chips or ITO coatings, control over the supply chain will be
crucial.”[4] New indium production from China and South Korea will be important to building thin
film production capacity.

US players to watch

Academic and corporate researchers around the world continue to study preparation tech-
niques of the various layers of CIGS thin film solar cells, such as pulsed layer deposition, to
increase performance.[5] Current leaders in this space include Global Solar Energy, Solopow-
er, Miasole, Nanosolar and Solyndra. Nerac’s proprietary patent analytics provide insights into
the areas of focus for solar technology development. The area of greatest patenting activity is
batteries (thermoelectric and photoelectric); Global Solar, Nanosolar and Solyndra collectively
have ten patents in the class. Multiple recent patents have been granted for semiconductor
device manufacturing processes (Nanosolar and Solopower), coating processes (Nanosolar),
and active solid-state devices (Global Solar, Miasole and Nanosolar).

The early entry of Global Solar into the thin film space is evident from a review of the patent
landscape, Figure 1: Timeline for Filing of US Patents in Thin Film Space.

Figure 1: Timeline for Filing of US Patents in Thin Film Space

Global Solar’s head start helps to explain why that company is one of the two market leaders
with commercial-scale operations today.

Further analysis reveals that Global Solar is the only one of the leaders showcased that does
not have an existing portfolio of pending applications in the World Patent and US patent offices

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(see Figure 2: Innovation Leaders). This is a sign that we will see changes in leadership as
the market for thin films matures.

Figure 2: Innovation Leaders

The leading US thin film developers have adopted various strategies for technology develop-
ment and commercialization. These are summarized as follows:

― Global Solar, Tucson, Arizona

Global Solar is financed, owned and operated by MMA Renewable Ventures, LLC, a
subsidiary of Municipal Mortgage & Equity, LLC. The company’s 100,000 square-foot
manufacturing facility was the first commercial-scale deployment of its CIGS cells. The
company has thus become the only CIGS leader to have its own technology powering
a commercial-scale solar array. SOLON Corporation produced and installed the PV
modules and designed the array. The installation covers 310,000 square feet, featuring
a ground-mounted array that uses 6,600 SOLON solar modules utilizing Global Solar’s
CIGS thin-film solar cells.

― Miasole, Santa Clara, California

Miasole’s manufacturing process for solar cells differs from other companies’ processes,
using a sputtering process to deliver active material to substrates of glass and foil. This
process is similar to that of the sputtering method used to deliver magnetic materials
to hard drives in the computer industry. (The founder of Miasole, Dave Pierce, is a
transplant from the computer industry.) Miasole’s progress toward commercial-scale
production has been somewhat slower than its competitors’. Recent reports indicate that
commercial production “isn’t expected to begin until 2009.”[6] Changes in management
and an increase in burn rate of venture funds highlight the company’s struggle to achieve
its performance goals.

― Nanosolar, San Jose, California

Although Miasole was attracted to the CIGS solar cell space at approximately the same
time frame as Nanosolar, Nanosolar has joined Global Solar as the second US-based

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 leader in commercial production. After five years of venture-funded development, product
was first shipped to a power plant in Eastern Germany for commercial use. The econom-
ics of printing non-vacuum/solution coated material is realized in the Nanosolar products,
which have allowed Nanosolar the distinction of being “the first solar manufacturer ca-
pable of profitably selling solar panels that generate as little as $0.99/w; and the highest-
current thin-film solar panel, delivering 5 times the current of any other thin-film panels on
the market.”[7] [8]

― Solyndra, Fremont, California

Solyndra’s panels are unique in their incorporation of cylindrical modules that allow air to
blow through them. The expected market appeal will be their unique design and simplified
installation process. Solyndra’s aluminum frames snap together in a way that the company
claims a reduction in installation time by a third, and an even more significant reduction in
installation price. Significant venture funding and reported early contracts keep Solyndra
on the radar screens of market analysts. Solyndra was also the first recipient of a loan
guarantee from the US Department of Energy. This money will fund manufacturing capac-
ity expansion.

― Solopower, Milpitas, California

Solopower uses electroplating to affix materials to the cell substrates. Solopower, like
other market leaders, has received hundreds of millions of dollars in venture funding to
move past research into commercialization, including $200M in September of 2008 to
expand manufacturing.[9]

Rising Stars
One of the newer innovators to enter the CIGS solar cell space is HelioVolt in Austin, Texas.
HelioVolt’s manufacturing process coats two precursor particle suspensions onto two differ-
ent substrates. The substrates are then brought together in a flash heating process, which
minimizes diffusion of the materials and creates a dense CIGS film. Although HelioVolt
“won’t be shipping commercial thin film solar material until at least early 2010”,[10] its FASSTTM
manufacturing process targets costs much less than $1 per watt,[11] which is competitive with
fossil fuels.

Additional US-based companies such as First Solar are competitors in the thin film market-
place. First Solar specifically supports development of a CdTe (Cadmium Telluride) cell, an
alternative to CIGS technology with Cadmium toxicity issues. Furthermore, CdTe cannot be
used with a flexible substrate. Thus, although First Solar is typically credited with bringing a
new era of thin film solar cells forward with $1.3 per watt low cost and 11 percent efficiency,
other players now show more promise as stable fixtures for the future.[12]

Chinese players to watch

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Among the many Chinese companies manufacturing PV panels, several are moving toward
newer technologies; indeed, nearly one-third of the companies participating in a March 2009
conference of module and cell manufacturers were Chinese. Some of the leaders include
China Nuvo Solar Energy, Shenzhen Topray Solar, Suntech Power, and the Xinao Group.

― China Nuvo Solar Energy (“China Nuvo”), Chengdu, China

China Nuvo announced in 2008 its focus on CIGS technology in conjunction with Pioneer
Materials. A pilot production facility constructed in 2008 has begun commercialization
efforts toward multi-stacked solar cells. This type of stacked design is expected to provide
higher efficiencies.

― Topray Solar, Shenzhen, China

Shenzhen Topray Solar, founded in 2002, is a leader in the silicon thin film solar market.
Topray Solar is responsible for the Chinese National Project for next-generation solar
cells. Under the Innovation and Technology Fund of the Government of the Hong Kong
Special Administrative Region, the company is partnering to develop a magnetron
sputtering-selenization method for the fabrication on CIGS solar cells.

― Suntech Power, Wuxi, China

Suntech Power has grown to be one of the largest solar energy companies in the world
since its start in 2002. Suntech designs, manufactures and markets a variety of photovol-
taic cells and modules, especially silicon-based designs. The predecessor company, Wuxi
Suntech Power Co., Ltd., or Suntech China, was established in Wuxi, China. Suntech
Power Holdings Co., Ltd., or Suntech, is currently showing significant growth as a publi-
cally traded company; it was the first privately-owned Chinese company to list on the
NYSE and the first Chinese company to ring the remote opening bell for the NYSE from
China in February 2009.

― Xinao Group, Langfang, China

In November 2007 the Chinese natural gas company known as the Xinao Group an-
nounced its entry into the solar module business with the purchase of Applied Materials
SunFab. The company has thin film manufacturing capabilities, which focus on deposition
of amorphous silicon onto glass panels. Since then forming ENN Solar, significant invest-
ment has been made to extend its stake in the manufacturing of thin films.

The Future
Research is rapidly advancing CIGS technology to meet the four main goals for PV manufac-
ture: (1) conservation of materials, (2) uniformity of layers, (3) reduction in commercial-scale
costs, and (4) creation of products that offer durability competitive with traditional roofing
materials. As the technological challenges are met, vast new markets will open for strong
and nimble players.

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China-based partners, with established production sites, distribution channels and market
share will be of strategic importance to help non-Chinese companies clear the substantial
hurdles to successful deployment in China. China has the potential to become not only the
leading producer of solar photovoltaics, but also the leading user. Currently over 99 percent
of what is produced in the solar photovoltaics industry “goes outside” according to the CREIA
secretary general Li Junfeng. [1] This is because the technology of today is too expensive.
The advancements in solar photovoltaics will shatter the economic barriers to use, and when
that happens, leaders in the thin film space, specifically CIGS cells, will reap substantial
rewards.

About the Author

Gerri Potash

Nerac Vice President of Technology Solutions Gerri Potash is also an

analyst who assists companies through advanced analytics of intellectu-
al property portfolios by drawing from her experience in guiding medical
device and pharmaceutical clients over commercialization hurdles. In
her role as vice president, Ms. Potash works with clients and Nerac
staff to build communication platforms to inspire and facilitate innovative
concepts. By assembling project teams that bring together analysts with
a wide range of expertise, Ms. Potash champions product development
efforts in new and fast-paced markets. As a medical device professional,
she has developed and executed quality program strategies for pharmaceutical and medical
device companies as well strategies to achieve regulatory approval on specific products.
Before joining Nerac, Ms. Potash spent several years assisting medical device, biotech and
pharmaceutical clients in technical and regulatory matters.

About Nerac
Nerac Inc. (www.nerac.com) is a global research and advisory firm for companies developing
innovative products and technologies. Nerac analysts are uniquely qualified to conduct objec-
tive, third-party clinical literature reviews to assist companies in meeting the European Union’s
new medical device requirements. Nerac analysts also deliver custom assessments of product
and technology development opportunities, competitor intelligence, intellectual property strate-
gies, and compliance requirements through a proven blended approach to custom analysis:
review of technical knowledge, investigation of intellectual property, and appraisal of business
impacts. Nerac deploys analysts in diverse disciplines to help clients discover new applica-
tions, serving as a catalyst for new thinking and creative approaches to business problems or
identifying strategic growth opportunities.

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Bibliography
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[2] Business Wire., “China Nuvo Solar Energy Announces Plans to Use Thin Film CIGS in Its
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ng=en.

[3] Nolan, Robert., “New NanoMarkets Report Identifies Trends and Opportunities in Thin-
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[4] Jansseune, Thomas., “Indium price soars as demand for displays continues to grow.”
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[5] Luo, Pai-feng, Guo-shun Jiang, Chang-fei Zhu., “Pulsed Laser Deposition ZnS Buffer Lay-
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[6] Kanellos, Michael., “Miasole’s Chief Researcher Defects to Solopower.” Greentechmedia,

Apr 17, 2009.

[7] Derbyshire, Katherine., “The problems and possibilities of thin film CIGS solar cells.” Solid
State Technology, Jan 2008.

[8] Schuller, Jason., “Nanosolar Ships its First Product.” Revolution, Jan. 22, 2008.

[9] Morrison, Chris., “Solopower is latest thin film company with a big raise, taking $200M for
a factory.” VentureBeat, Sept 11, 2008.

[10] Ehrlich, David., “HelioVolt Delays Commercial Shipping Until 2010, While CEO Steps
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[11] Heliovolt Website., [Online] [Cited: Apr 16, 2009.] http://www.heliovolt.net/.

[12] Pakulski, Gary T., “Alternatives for Electricity: Analysts Give First Solar Edge in Race for
Cost Efficiency.” Toledo Blade, Jul 15, 2007.