FRANKFURT May 29 (Reuters) - Abu Dhabi says it will invest $2 billion in cutting edge solar technology, building thin-film module production plants in Germany and Abu Dhabi, as it strives to compete with industry leaders such as First Solar (FSLR.O).
Masdar PV is part of Masdar Initiative, a $15 billion initiative set up by the Abu Dhabi government to develop sustainable energy and other clean technologies.
"We are making a very large investment in what will eventually become a gigawatt multi-country producer, one of the leading producers globally in thin-film," said Steve Geiger, director of special projects at Masdar.
Thin-film solar modules are less efficient at turning sunlight into electricity than silicon-based equivalents, but production costs are lower because they use little of the currently scarce solar-grade silicon, if at all.
Masdar plans to set up two thin-film production plants, the first in Erfurt, Germany, and the second in Abu Dhabi, with a combined annual production capacity of 210 megawatt. Further sites could follow, possibly in the United States.
It aims to reach 1 gigawatt of capacity by 2014.
"The idea is to have a smart copy process by which, once we have the German facility started, to smart copy that back into an even larger facility in Abu Dhabi and into other countries as well," Geiger said.
Masdar picked the world's largest photovoltaic market for its first move to benefit from local expertise as well as from a favourable government support scheme for renewable energy.
"We appreciate the support that the government is providing, allowing us to attract and develop high-tech workers to make us competitive and successful in what is arguably one of the most competitive industries in the world," Geiger said.
Masdar PV is striving for the top, aiming to compete with the world's largest thin-film makers, such as First Solar.
"Since they are the world's leading photovoltaic thin-film company today and they are growing very, very aggressively they would clearly be one of our prime competitors," Geiger said, referring to First Solar.
Abu Dhabi's move, however, raised concern that such large investments could drive smaller German solar companies out.
"This will trigger a wave of consolidation," said Heino Ruland, market analyst at FrankfurtInvest.
Shares in European solar companies such as Renewable Energy Corporation (REC.OL), SolarWorld SWVG.DE and Q-Cells QCEG.DE plummeted on Thursday, also after Merrill Lynch downgraded the stocks to "sell" from neutral".
"Photovoltaic has really entered a different stage, where it's a volume game and it's a multi-country platform game," Masdar's Geiger said and referred to the market as so-called "solar 2.0".
"We are very lucky that we have the firepower to place multiple bets on multiple technologies," he said.
The Masdar Initiative is focused around a new, zero carbon-emitting "green" city to be completed by 2015 which it says will be the hub of clean technology businesses, research and deployment as well as home to 40,000-50,000 people and a workplace for another 40,000 commuters. (Editing by Sue Thomas)
Trending On Reuters
Nepali police and local volunteers found the bodies of about 100 trekkers and villagers buried in an avalanche set off by last month's devastating earthquake and were digging through snow and ice for signs of dozens more missing, officials said on Monday. Full Article | Slideshow
- Everest not officially closed to climbers, Nepal says
- Video: Nepalese leave Kathmandu and return to villages
- Monsoons could bring disease, a second crisis, to Nepal - UNICEF
- Insight - Soul-searching over quake ends Everest climbing season
- Video: Relief goods for Nepal quake victims held up, remote areas awaiting aid
Facebook launches open Internet.org platform amid net neutrality debate in India Full Article