Potential for High Volume PV Manufacture in Australia

D P t F th CTO t th h t lt i AGDr. Peter Fath, CTO, centrotherm photovoltaics AG

UNSW, Sydney, May 21st 2009

©

Disclaimer

We have exercised utmost care in the preparation of this presentation It contains forecasts and/orWe have exercised utmost care in the preparation of this presentation. It contains forecasts and/or information relating to forecasts. Forecasts are based on facts, expectations, and/or past figures. As with all forward-looking statements, forecasts are connected with known and unknown uncertainties, which may mean the actual result deviates significantly from the forecast. Forecasts prepared by third parties or data or evaluations used by third parties and mentioned in thisprepared by third parties, or data or evaluations used by third parties and mentioned in this communication, may be inappropriate, incomplete, or falsified. We cannot assess whether information, evaluations, or forecasts made by third parties are appropriate, complete, and not misleading. To the extent that information in this presentation has been taken from third parties, or these provide the basis of our own evaluations such use is made known in this report As a resultthese provide the basis of our own evaluations, such use is made known in this report. As a result of the above-mentioned circumstances, we can provide no warranty regarding the correctness, completeness, and up-to-date nature of information taken, and declared as being taken, from third parties, as well as for forward-looking statements, irrespective of whether these derive from third parties or ourselvesparties or ourselves.

Rounding differences may arise.

© 2© 2

Technology and equipment supplier for PV industry

centrotherm photovoltaics at a glance

centrotherm Leading market player of turnkey crystalline solar cell production lines

Unique supplier of turnkey solutions over full crystalline solar cell value chain and leading thin film technology photovoltaics:

Focus on innovation & technology

Business Divisionsleadership

► Solar cell► Silicon ► Thin film ► Semiconductor

Technology & Equipment

ServicesTurnkey lines Key equipmentTurnkey production plants

Key Figures

2007 2008 Employees: 178 1,050

© 3

Sales: 166 M€ 375 M€

EBIT: 21 M€ 56 M€*

* excluding effects from purchase price allocation

Solar

Portfolio: Major Equipment and Technology

► Solar Silicon ► Crystalline Solar CellDiversification along PV value chain

Technology

► Equipment

► Equipment (Reactor & Converter for ili d iti )

►2,500 t silicon production plant

Technology competence & key equipment

silicon deposition)

► Crystallization furnace for multi ingoting

► Module

Fab design

Facility design

Technology

Equipment

Turnkey solutions & Single

► 30/50/100 MW solar cell production plant

► Thin Film ► Module& Single Equipment

► Thin FilmCIGS* Technology

► 30/50 MW CIGS-thin film modules production line

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► Sputtering equipment► 5/10/30 MW module production lines

*CIGS = Copper Indium Gallium Diselenide 5

Outline

Is there a potential for high volume PV manufacturing in Australia?

For an answer, the following major topics are considered:– Is there a market for PV modules/systems? (World – Australia)– What technologies are available for investors and can the products be

manufactured in a competitive way in Australia?– Is skilled personnel available? What is the technology expertise?Is skilled personnel available? What is the technology expertise?

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Outline

Is there a potential for high volume PV manufacturing in Australia?

Is there a market for PV modules/systems? (World – Australia)What technologies are available for investors and can the products be

f t d i titi i A t li ?manufactured in a competitive way in Australia?Is skilled personnel available? What is the technology expertise?

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„Non-subsidized Market“ Generation by Reducing PV System Cost

Generation of non-

non-subsidy

subsidized markets to generate future growth of PV market PV competitiveness against

PV market development PV competitiveness

Calculation using assumptions: 20 years depreciationol

ume

non subsidy

subsidy driven

When and at what PV system price?

market household electricity prices?

y p 1% operating cost 4% interest rate Output degradation 0,5%/apr

oduc

tion

vo When and at what PV system price?- off-grid markets- utility grid parity- customer grid parity

p g , Different conditions for

- local irradtion level- electricity prices

PV

2002 2004 2006 2008 2010 2012 2014 2016

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PV Market: Bright Outlook, but Clouds Ahead

90

100

110

GW production volume centrotherm photovoltaics AGMarket & Technology Research

70

80 bright futurePV = established industryreduced cost

consolidation phaseindustry

40

50

60 sunny take-offwave of start-upsstart of mass productionsilicon shortagehigh margins

industry consolidationprice decline

grid parity utilitytake-off

20

30

g g

grid parity consumertake-off

0

10

2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022

take off

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subsidy driven consumer grid parity off-grid utility grid parity

„Customer Retail Price“ Grid Parity @ 3 €/Wp

Grid parity in 0 40 € / kWh (bubble size = market size)p y

near future

0,35

0,40 € / kWh (bubble size market size)

InstalledSystem

Price 3 € / Wp

0,25

0,30

Grid Parity

HawaiiItaly

0,20Germany

California

Hawaii

Portugal

0,10

0,15

Texas

Australia

France

Spain

Greece

0,00

0,05

Average householdelectricity price Sun Irradiation [kWh/m²/year]

Greece

India

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700 800 900 1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000 2100 2200

„Customer Retail Price“ Grid Parity @ 2,50 €/Wp

Grid parity in €/kWh (bubble size = market size)p ynear future

0,35

0,40€/kWh (bubble size = market size)

0 25

0,30

Grid ParityHawaii

InstalledSystem Price 2.50 € / Wp

0,20

0,25

Germany

Portugal

ItalyHawaii

0,10

0,15

France Spain

California

Australia

0,05

Greece

Sun Irradiation [kWh/m²/year]

Average householdelectricity price

IndiaTexas

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0,00700 800 900 1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000 2100 2200

Sun Irradiation [kWh/m²/year]y p

How to Achieve PV System Price < 3 €/Wp?

Estimate of €/Wp

maximum module manufacturing cost to achieve PV system price of< 3 €/W

Ins tallation profit 0,27 €/Wp

Labour cos t 0,10 €/Wp

3,0

2,5

system  price

< 3 €/Wp, / p

Inverter   0,25 €/Wp

S ti t t bl 0 20 €/W

2,0module  price

S upporting s tructure, cables    0,20 €/Wp

Module trading   0,10 €/Wp

1,5

1 0

module  manufac t. cost

Target: Margin 25% ,   0,51 €/Wp

Overhead 10% ,   0,14 €/Wp

1,0

0,5

Target:module manu-facturing cost

< 1,40 €/Wp

Manufacturing  cos t 1,40 €/Wp0,0

N Th d l f i d d h d l ffi i M d l i h l ffi i i l

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Note: The target module manufacturing depends on the module efficiency. Modules with lower efficiency require lower manufacturing costs („BOS-penalty“). The calculation is based on crystalline silicon with a cell efficiency of 15,8%.

PV Market: Australia

Aus tralian PV  Market F orecas t

160

180

200

rHis torical Data

His torical Data

120

140

160

d pe

r ye

a S park ‐ C onservative

S park ‐ Aggress ive

S park ‐ Aggress ive plus  S olar F arms

B l C it l R h

80

100

120

W In

stalled B arclays  C apital R esearch

40

60MW

0

20

1 2 3 4 5 6 7 8 9 10 11 12

© 12Source: Spark Solar

Outline

Is there a potential for high volume PV manufacturing in Australia?

Is there a market for PV modules/systems? (World – Australia)What technologies are available for investors and can the products be

f t d i titi i A t li ?

manufactured in a competitive way in Australia?Is skilled personnel available? What is the technology expertise?

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Value Chain [c-Si ↔ Thin Film]

c-Si:

Feedstock Wafer Solar Cell Module Systemy

CIGS

SubstrateFeedstock SystemSolar Cell / ModuleFeedstock System

centrotherm photovoltaics (new)

centrotherm photovoltaics

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centrotherm photovoltaics (new)

Schematics of CIGS Solar Cell

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Centrotherm ThinFilm CIGS

Turnkey production line 50 MW / 100 MWTurnkey production line 50 MW / 100 MW Flexible Fab-design Scalable Fab-size

production floor space < 8000 m² @ 100 MWp

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Thin Film Module Factory

t t

Factory Layout and Processes

d

sputtering TCO

contacts application

jV measuremech cut P3

edgedeletion

chemical bathl i ti

Se annealing

sealingmech cut P2

lamination

junction box & frameSe deposition

glass washing

sputtering Cu, Ga, In jV measureclassification

laser cut P1sputtering Mo

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washing

Cost Structure CIGS Module Manufacturing

Total Cost: € 1,23/ Wp (conservative assumptions)

Other costs (spares etc.); 6,3%

, p ( p )

Depreciation Production Equipment; 24,3%

Electric Power; 7,6%

Yieldloss costs; 4,7%

DepreciationOther materials; 13 7% Depreciation Facilities&Building;

4,8%

Other materials; 13,7%

Labor; 9,9%

Glass (front + back);Copper/Gallium; 6 2%

Indium; 2,3%

ZnO; 5,8%

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Glass (front + back); 12,6%

Molybdenium; 1,9%

Copper/Gallium; 6,2%

Achieving Grid Parity by an Integrated Fabrication (Crystalline Si)

Cost advantages of integrated fabrication:Integrated g g– Reduced cost due to enhanced overall product yield (e.g. omission of

long distance shipment of wafers and cells)F t f db k l d i ifi t ti i ti t ti l th

gfabrication as way to achieve grid parity

– Fast feedback loops and significant optimization potential over the entire value chain results in better product quality and yield

– Reduced overhead cost (QC, purchasing, sales …)– Reduced working capital – No long term purchasing contracts and down payments

( )– Fast response to changes in the market (along complete value chain)

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Integrated Factory: Overview

Example: Grid Parity factory in Germany/CanadaPolySi PlantKey figures of

Integrated factory consisting of 5 single factories using state of the art technology available today

PV Power Plant(optional)

MG Si Plant(optional) Ingot Plant

Solar Cell Fab

Wafer Fab

Solar Module Fab

y gintegrated fabrication in Canada and Germany

technology available today– Poly Si (TCS / "Siemens"): 2.500 t/a– Multi ingot: 2.270 t/a

M lti f 97 illi f /

Administration

Solar Academy

Module manufacturing cost 1,26 < 1,40 €/Wp

ibl – Multi wafer: 97 million wafer /a– Cell: 361 MWp/a– Module: 347 MWp/a

Example layout at one location

possible

Calculated scenario includes poly silicon factory using lower electricity costs in Canada + wafer, cell & module production in Germany

Module manufacturing cost

Canada Germany

Module manufacturing cost

Example layout at one location

production in Germany CAPEX 718 Mio € (accuracy +/- 10%)Silicon

0,45€

ModuleWafer Cell Ingot

0,21€/Wp 0,45€/Wp0,18 /Wp 0,28€//Wp0,14 €/Wp

Canada Germany

© 201,26 €/Wp

*

, p , p, p , p, p

* Accuracy of all figures +/- 10%

Modu

Integrated Factory: Polysilicon Production Plant

SiliconI t W f

SolarKey figures of

le

TCS / Siemens technology18 Si t d iti t

Ingot WaferCellDistillation Columns

PolySi Deposition

TCS Synthesis

y g2.500 t Poly-Si productionin Canada

18 Siemens type deposition reactors Capacity 2.500 t/a 80.000 m² Production cost 28 5 €/kg (0 21 €/W )

MG SiMilling

PolySi Depositionand TCS Conversion

Vent Gas Recovery

Production cost 28,5 €/kg (0,21 €/Wp)

Total Costs: 71 Mio. €/a

Poly Si

Equipment: 227,0 Mio.€

Labour Costs17% Depriciation

Equipment/ Technology

31%

Poly Si

Building: 85,0 Mio.€ Production goods: MG Si 1,60 t/t Poly-Si

HCl 0,48 t/t Poly-Si Running Cost: Electr. 165 kWh/kg Depriciation

Running Costs32%

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Running Cost: Electr. 165 kWh/kgUtilities 1,6 €/kg

Workforce: 239 persons

Depriciation Building &

Facility8%

32%

Production Goods

12%

Integrated Factory: Ingot ManufacturingModuSilicon

I t W f

SolarKey figures of

Crystallization of ingots and bricking 28.000 m²

le

Ingot WaferCell

Bricking

Crucible removal

y g2.270 t ingot manufacturingin Canada

8 000 53 Crystallization furnaces Capacity 2.270 t ingots / a Production costs 20,7 €/kg (0,14 €/Wp)Crucible Crystallization

Total Costs: 47 Mio. €/a

Crucible preparation

Crystallization furnaces

Crucible Loading

Equipment: 80,5 Mio.€

Depriciation Equipment/ Technology

24%Labour Costs

Ingot

Building: 16,0 Mio.€ Production goods: Crucibles 2,2 pcs./t Running Cost: Electr. 25,9 kWh/kg

Utiliti 1 10 €/k Production

Depriciation Building &

Facility2%

Labour Costs36%

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Utilities 1,10 €/kg Workforce: 358 persons

Production Goods

17%Running Costs21%

Integrated Factory: Wafer ManufacturingModuSilicon

I t W f

SolarKey figures of

Sawing of bricks to wafer 18.500 m²

le

Ingot WaferCell

y g97 Mio. wafer manufacturingin Germany

55 wafer saws Production of 97 Mio. wafer / a Wafer thickness 180 µm Production costs 0,63 €/wafer (0,18 €/Wp)

Total Costs: 61 Mio. €/a

Equipment: 76,8 Mio.€ Building: 13 0 Mio €

Depriciation Equipment/ Technology

25%

Labour Costs15%

Wafer

Building: 13,0 Mio.€ Production goods: Slurry, Wire Running Cost: Electr. 0,20 kWh/Wp

Utilities 0,023 €/Wp

25%

Depriciation Building &

Facility1%Running Costs

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p

Transport. 0,005 €/Wp

Workforce: 198 persons

1%

Production Goods

27%

32%

Integrated Factory: Solar Cell ManufacturingModuSilicon

I t W f

SolarKey figures of

7 centrotherm solar cell turnkey lines (>50MW each)

le

Ingot WaferCell

PECVD

y g361 MWp cell manufacturingin Germany

(>50MWp each) 18.000 m² Efficiency 15,8% on multi wafer Production of 361 MWp / a

Texturing

Diffusion

Printing

Firing p

Production costs 1,02 €/wafer (0,28 €/Wp)

Total Costs: 96 Mio. €/a

Firing

Wafer InspectionSystem

Classificationand Sorting

Equipment: 110,0 Mio.€ Building: 16 3 Mio €

Depriciation Equipment/ Technology

23%Labour Costs

17%

Cell

Building: 16,3 Mio.€ Production goods: Paste front 0,047 g/Wp

Paste rear Ag 0,042 g/WpPaste rear Al 0,42 g/Wp

Running Costs18%

Depriciation Building &

Facility1%

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Running Cost: Electr. 0,21 kWh/Wp

Utilities 0,024 €/Wp

Workforce: 323 persons

Production Goods

41%

Integrated Factory: Solar Module ManufacturingModuSilicon

I t W f

SolarKey figures of

Module design: - 60 cells per module, 220 Wp- glass / backsheet laminate

le

Ingot WaferCell

Testing and Sorting

Trimming,Framing,

Junction Box

Glass Washing

y g347 MWp module manufacturingin Germany

glass / backsheet laminate- framed

20 lamination lines 20.000 m²

Stringing

LaminationLayup

Glass Washing

Production 347 MWp / a Production cost 98 €/module (0,45 €/Wp)

Total Costs: 157 Mio. €/a

g g

Interconnection

Equipment: 73,5 Mio.€ Building: 20,0 Mio.€ Labour Costs

Depriciation Equipment/ Technology

9%

Module

Production goods: Glass 1,6 m2/moduleEVA 3,2 m2/moduleBacksheet 1,6 m2/moduleFrame 5,2 m/module

Running Costs9%

9% Depriciation Building &

Facility1%

9%

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Junction box 1 pcs/module Running Cost: Utilities 0,025 €/Wp

Workforce: 305 persons

Production Goods

72%

Integrated factory: Summary CAPEX

Solar ModuleInvestment

CAPEX and key

Poly-SiSolar Cell

93 Mio. € y

figures of integrated fabrication

y312 Mio. € 126 Mio. €

Multi Ingot 97 Mio. €

Wafer90 Mio. €

Further figures

Capacity MachineryBuilding &

Infrastructure WorkforceCapacity Machinery Infrastructure WorkforcePoly-Si 2.500 t 227 Mio. € 85 Mio. € 239Multi Ingot 2.270 t 80 Mio. € 16 Mio. € 358Wafer 374 MW 77 Mio. € 13 Mio. € 198Solar Cell 361 MW 110 Mio. € 16 Mio. € 323

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Solar Module 347 MW 74 Mio. € 20 Mio. € 305Total 568 Mio.€ 150 Mio. € 1423

Integrated Factory: Different Production Location

Production costs €/Wpfor four different locations: - Canada/Germany - USA

Australia 1,20

1,40 1,26 €/Wp 1,23 €/Wp 1,19 €/Wp

p

1 07 €/Wp- Australia- China.

Major differences are the price of l t i it d

0,45 0,45 0,44

0 41

1,00 Module

1,07 €/Wp

electricity and labour.

0,28 0,26 0,25

0,41

0 60

0,80 Cell

Wafer

0,18

0 14

0,16 0,160,14

0,23

0,40

0,60 Multi Ingot

Poly-Si

0,21

0,14

0,22

0,14

0,21

0,13

0,19

0,100,20

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- Canada / Germany USA Australia China

Smart Integrated Factory

Smart integrated factory:Further cost Smart integrated factory: Processes at the interface between the different factories are merged leading to a

truly integrated factory

reduction potential in Smart Integrated Factory

Major factors for cost reduction in smart integrated factories:1. Investment

R d d i t t t i t f k i i t t d f t i Reduced investment at interfaces: no packaging, integrated manufacturing equipment, reduced effort in QC (outgoing/incoming inspection)

2. Lower work force number Reduced packaging storage QC Reduced packaging, storage, QC

3. Decreased overall material loss No material loss by shipment/packaging Optimized process flow over the full value chain

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Potential for reduction in manufacturing cost: 6 to 10%

How to Achieve Grid Parity?

Target PV system cost: < 3 €/Wp Grid parity can be p yachieved with crystalline silicon or high efficiency thin film technology Option 1: Option 2:technology. p

crystalline silicon technology(integrated fab)

Option 2:thin film technology(CIGS fab)

2 6 €/Wp PV system cost 2,7 €/Wp PV system cost

BOS  (invert.,  ins tall., etc .) 0,9 €/Wp

margin 25% , 0,35 €/Wp

overhead 10% 0 13 €/Wp

2,6 €/Wp PV system cost

BOS  (invert.,  ins tall., etc .) 1,0 €/Wp

margin 25% , 0,34 €/Wp

h d 10% 0 12 €/W

2,7 €/Wp PV system cost

overhead 10% , 0,13 €/Wp

module 0.45 €/Wp

cell 0.28 €/Wp

f 0 18 €/Wmod

ule

ng c

ost

overhead 10% , 0,12 €/Wp

other 0,10 €/Wp

labor 0,12 €/Wp

mod

ule

ng c

ost

wafer 0.18 €/Wp

ingot 0.14 €/Wp

polyS i 0.21 €/Wp1,26

€/W

p m

man

ufac

turi glas s  0,14 €/Wp

materials  0,50 €/Wp

deprec iation 0,37 €/Wp1,23

€/W

p m

man

ufac

turi

n

© 29

integrated c ‐S i fab C IGS  Thin film fab

Specific factors for PV manufacturing in Australia

It s not necessary to invest in complete value chain for c-Si, also smaller capacitiesIt s not necessary to invest in complete value chain for c Si, also smaller capacities are economically feasible

Poly-Si Poly-Si– Requires minimum capacity of 1.250 t/year. – Manufacturing in a cost-competitive way (low electricity) possible– For domestic use and world market

Multi ingots – Manufacturing in a cost-competitive way possible g p y p– For domestic use and world market

Multi wafersM f t i i t titi ibl– Manufacturing in a cost-competitive way possible

– Manufacturing costs are determined by production goods (slurry, wire) and running costs

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– For domestic use and world market

Specific factors for PV manufacturing in Australia Solar cell

– Manufacturing is the most technologically advanced and important process in the value chain, since it determines major product factors (e.g. efficiency)

– Excellent technologist are necessary to achieve high efficiencies and quality ( il bl i A t li )(available in Australia)

– For domestic use and world market Solar module

– Manufacturing favored close to the end-consumer market– Capacity could be matched to growing demand– Absence of a module manufacturer and growing demand represent a good time– Absence of a module manufacturer and growing demand represent a good time

to start investment now– Domestic modules have an advantage over imported ones

Modules can be optimized with respect to the specific conditions of Australia– Modules can be optimized with respect to the specific conditions of Australia (e.g. high irradiation, high temperature)

– Domestic manufacturers have an advantage due to deeper market insight and more direct distribution channels

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more direct distribution channels

Outline

Is there a potential for high volume PV manufacturing in Australia?

Is there a market for PV modules/systems? (World – Australia)What technologies are available for investors and can the products be

f t d i titi i A t li ?

manufactured in a competitive way in Australia?Is skilled personnel available? What is the technology expertise?

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Research at Institutes and IndustryPhotovoltaics Centre of Excellence, UNSW

Research in “first generation” c Si wafer technology medium term “second generation” thin film- Research in first-generation c-Si wafer technology, medium-term second-generation thin film module technology and long-term “third-generation” solar cells

Centre for Sustainable Energy Systems, ANUResearch focuses on Si PV especially on technology material properties and processing- Research focuses on Si-PV, especially on technology, material properties and processing. Further topics include Sliver and other new cell concepts

Murdoch UniversityR h Si i bi ti f t lli d h ili ll- Research on a-Si, using a combination of nanocrystalline and amorphous silicon alloys; research on methods for upgraded metallurgical grade silicon (direct refinement)

Industry Research e.g. at Origin Energy (SLIVER cells), CSG Solar (crystalline silicon on glass) y g g gy ( ) ( y g )and Dyesol (dye solar cells)

Several important patents with Australian origin e.g. Laser grooved buried grid (Green, Wenham; BP Solar); SLIVER (Blakers Weber; Origin) crystalline silicon on glass (Green Wenham CSGBP Solar); SLIVER (Blakers, Weber; Origin), crystalline silicon on glass (Green, Wenham, CSG Solar)

Australia has a high level of expertise in R&D and education in PV

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In Australia, exceptionally skilled personnel is available, an important factor for

producing high quality PV products

Conclusion

There is a potential for high volume PV manufacturing in Australia

Is there a market for PV modules/systems? (World – Australia)What technologies are available for investors and can the products be

f t d i titi i A t li ?

manufactured in a competitive way in Australia?Is skilled personnel available? What is the technology expertise?

© 34

Summary

There is potential for high ol me PV man fact ring in A stralia There is potential for high volume PV manufacturing in Australia. The occurrence of grid parity will further stimulate market demand, in the

world as well as in Australia. Grid parity can be achieved in several locations at system prices below 3 €/W This requires modulelocations at system prices below 3 €/Wp. This requires module manufacturing costs below 1,40 €/Wp.

Example of integrated c-Si factory in Australia:– 2.500 t of Poly-Si result in 347 MWp of solar modules– Manufacturing costs of 1,20 €/Wp using conservative assumptions

Example of CIGS factory:Example of CIGS factory:– Typical factory size of 50 MW / 100 MW (flexible and scalable)– Manufacturing costs of 1,23 €/Wp using conservative assumptions

The manufacturing in Australia is cost-competitive. Australia has a high level of expertise in R&D and education, highly skilled

personnel is available. This makes it a good location to manufacture PV d t

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products.

Thank you for your attention!

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Company Location and Contact Details

I centrotherm photovoltaics AG

Johannes-Schmid-Straße 889143 Blaubeuren89143 BlaubeurenGermany

Phone: +49(0)7344 - 9188 803Fax: +49(0)7344 - 9188 388

© 37© 37

info@centrotherm-pv.dewww.centrotherm-pv.de