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As Solyndra falls, Stion scales up

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As one thin-film solar company falls (Solyndra), another one is scaling up. Silicon Valley startup, Stion, on Friday officially opened the doors of its factory in Mississippi, marking a milestone for the company as it seeks to expand production quickly in an increasingly competitive market.

San Jose-based Stion makes solar panels that use copper, indium, gallium and selenium (CIGS) instead of conventional silicon to convert sunlight into electricity. In January this year, the company announced the plan to build the Mississippi factory, which the company expects to eventually reach 500 MW of production capacity and require $500 million in investment. Stion completed a 10 MW pilot line at its headquarters last year.

The factory represents a nice coup for Mississippi lawmakers, who offered Stion a $75 million loan plus tax and job training incentives to build and run the factory. Legislator and Gov. Haley Barbour recently lured another Silicon Valley startup, Calisolar, by offering the solar silicon producer a $75.25 million package to build a factory there.

Stion plans to expand its production in Mississippi in phases. The first phase is supposed to reach 100 MW of production capacity. The company held a grand opening ceremony for the factory on Friday, but it won’t start producing solar panels until later this year, Stion said. Manufacturers need time to test-run equipment and train employees before rolling out products.

Stion hopes to mass-produce solar panels at much lower costs than its rivals, a goal that is shared by many startups and is increasingly difficult to accomplish. Wholesale prices of solar panels have plummeted in the past three years as manufacturers in the U.S., Asia and Europe built many factories.

Chinese manufacturers, in particular, have expanded production rapidly thanks in part to the huge loans they received from government-run banks. The stiffened competition already has forced three American companies, including CIGS solar panel maker Solyndra, to file for bankruptcy in the last two months.

Stion raised a Series D round of $70 million as of June 2010, including $50 million from Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chip manufacturer. Before that, it had raised $44.6 million in equity from investors including Khosla Ventures, VentureTech Alliance and Lightspeed Venture Partners.

To expand the Mississippi factory to 500 MW, Stion plans to raise at least another round of funding and will consider an initial public offering, the company’s CEO, Chet Farris, told us earlier this year.

Image courtesy of Stion

6 Responses to “As Solyndra falls, Stion scales up”

  1. Well, Mississippi may be smart enough to cover the sides of their freeways with solar panels built by their own people. Generating jobs,taxes,lower petroleum usage to generate electricity,reduce air pollution,create shade for the HOV lane,offset the power needs of high speed transport,keep the new UPS hybrid trucks charged up, etc,etc,etc.
    Power consumption is only going to continue to grow.
    This summer’s power consumption was up 23% over last years peak summer needs.

  2. This will end badly as well… CIGS is an unbelievably difficult and expensive material to process. It will be difficult for a start-up to compete against incumbent silicon players.

  3. So the Democratic party and the president are being heavily criticized by the Republicans for the Solyndra loan, saying the government never should have made the $500M+ loan guarantee to any one company (as if they didn’t do things like that with banks in 2008/9). Yet here is a very small state, run by a Republican governor, giving a $70M loan (plus tax breaks and other incentives) to another solar company, after giving a $75M loan to another solar company. The $150M+ cost to Mississippi is a far bigger burden than the $560M loan was to the US, yet why is there no criticism from the Republican party about this deal? What makes this specifically targeted investment by a government any better than the Solyndra loan by the federal government, especially considering these deals are being made AFTER the US solar industry crashed, while the Solyndra loan guarantee was made before the Chinese government subsidized their manufacturers into creating an price-crushing oversupply? If the federal government isn’t supposed to “pick winners”, then why is Mississippi, led by Gov. Barbour, allowed to?

    • I think it needs to be accepted that a number of solar firms will fail and that is the price for finding the winners, granted I do think that film is going to struggle they all seem to have set the manufacturing cost at $0.75 – $1w when really to give head room they should be targeting $0.25 – $0.50/w at equivalent efficiency to market rates as a minimum. It’ll be an interesting year this year but I’m afraid I don’t see any of the thin film guys having enough headroom to sustain them past the next two years… Now Sliver cells that’s a different question!