Solar silicon company gets $10m to help build new factory
1366 Technologies Inc., an MIT spin-off that says it can sharply cut the cost of solar-power cells, has added a new investment of $10 million to aid in the construction of a factory in upstate New York.
The money, supplied by Korean firm Hanwha Investment Corp., brings total private investment in 1366 Technologies to about $80 million. The company also has landed sizable government backing, including a $150 million federal loan guarantee, to help build the facility in Genesee County.
1366 Technologies creates silicon wafers that are the heart of a photovoltaic cell. Those wafers are typically made by “sawing” them from blocks of hardened silicon with a special wire, which turns about half of the material into the silicon equivalent of sawdust.
Bedford-based 1366 Technologies, however, has developed a way to form those wafers from molten silicon. That eliminates the steps of cooling and slicing the raw material, which saves money by wasting less silicon and cutting out extra equipment.
1366 Technologies chief executive Frank van Mierlo said his company’s intellectual property is protected by international patents, and by the fact it’s based in the United States. “As long as you don’t ship the equipment abroad, you keep control of the IP,” he said.
That technology is the key reason 1366 Technologies thinks it can compete with typically lower-cost Chinese solar suppliers, which have pummeled American competitors in recent years.
Among the more prominent examples are Solyndra LLC of Fremont, Calif., which shut down after winning a $528 million federal loan, and Marlborough-based Evergreen Solar Inc., which attracted more than $50 million in state support before filing for bankruptcy.
Fatima Toor, an engineering professor at the University of Iowa, said 1366 Technologies’ survival has been a rare bright spot for government support in the solar sector.
“The one good thing that the Department of Energy did was to invest in 1366,” she said.
Federal officials, however, said their efforts have had a broad impact on the clean-energy sector. As of December, the Energy Department’s Loan Programs Office has collected more than $7.1 billion in repayments, with losses accounting for about 2 percent of roughly $32 billion in total commitments, department spokesman Brian Mahar said.
1366 Technologies has been testing its processes at a pilot facility in Bedford. It’s now laying the foundation for its commercial-scale New York factory, which will be capable of producing about 1 million silicon wafers per week, van Mierlo said.
The company plans to expand that capacity in later rounds of construction. “We are very methodically building a very large business,” van Mierlo said. “We’re not going to get there in one day.”
In addition to the $150 million federal Energy Department loan guarantee, New York officials pledged more than $58 million in government incentives for the plant. It is expected to begin production sometime in 2017.
1366 Technologies already has one significant customer for the unfinished plant. Korean solar-cell manufacturer Hanwha Q Cells — part of the same conglomerate as 1366’s new investor — recently signed up to purchase about 60 percent of the new factory’s output for five years.
“In order for 1366 to grow, these supply agreements are going to be vital,” said Tyler Ogden, a solar analyst at Lux Research. “But before that’s going to be a possibility, these manufacturers are going to want to test 1366’s wafers on their production lines to ensure that they are getting the same efficiency that they are with their current supply.”