The board of directors of AU Optronics (AUO) on May 27, 2010 approved plans to jointly set up a high-efficiency solar cell plant in Malaysia with US-based Sunpower. AUO and Sunpower will contribute US$350 million each to the joint venture and expect volume production to begin in the fourth quarter and capacity to total 1.4GWp in three to four years, according to the company.
AUO has been quite active since its foray into the solar sector. In 2009, AUO invested US$357.5 million to acquire a 65.57% stake in M.Setek, and has since announced an additional investment of US$167 million to the Japan-based poly-Si producer in January 2010. AUO is also cooperating with solar installation companies in Germany, and expanding solar module capacity in Taiwan, China and the Czech Republic. It recently constructed a solar cell plant with a capacity of 30MWp also.
The AUO-Sunpower alliance is seen as highly complementary for both sides. AUO has found an entry into high-efficiency solar cell manufacturing, which requires much more advanced technology, industry sources said. Sunpower possesses patents in back contact solar cells, the technology behind its success in providing the highest efficiency rate commercially available to date.
However, higher conversion rates translate to higher production costs, which is one of the reasons Sunpower has turned in performances below market expectations despite a ferocious demand rebound since 2009.
In return for sharing its intellectual property, Sunpower is hoping AUO's experience in volume production can improve its cost control, the sources said. Sunpower currently has 600MWp of capacity for high-efficiency solar cells.
Sunpower, perhaps realizing the cost issue, recently sourced conventional solar modules which it marketed under the Serengeti brand. The move sent shockwaves through the sector since Sunpower is considered the vanguard in high-efficiency solutions, which solar companies in the US and Europe are hoping to rely on to prevent price wars as China-based players continuously ramp up capacity.
Industry watchers believe AUO's acquisition of M.Setek also played a key role in the alliance. The Japan-based company has been Sunpower's long-time supplier of N-type solar wafers, a material in back contact solar cells production.