Signet Solar to invest Rs 20,000-mn

Chennai: The US-based Signet Solar signed a memorandum of understanding with the Government of Tamil Nadu to put up a Rs 2,000-crore project to manufacture ‘thin film photovoltaic modules’ at Sriperumbudur, near Chennai.

(The MoU, which was signed by the State Industries Secretary, Mr M.F. Farooqui, and Dr Prabhu Goel, Chairman, Signet Solar, formalises the concessions that are allowed under the Government’s industrial policy.)

Signet Solar, headquartered in California, has orders worth $400 million (Rs 1,600 crore) on hand. Its first manufacturing facility is nearing completion at Dresden, Germany. More orders are expected, thanks to the growing demand for solar power globally. The Sriperumbudur plant is coming up in anticipation of these orders.

The investment would be spread over the next five years. At the end of the period the plant would have a capacity to manufacture PV modules, which, when installed, will be capable of generating 300 MW of power.

Multiple locations:

The company, however, wants to have installed capacity for producing 1,000 MW of PV modules annually, by 2016. However, only 300 MW will come up at Sriperumbudur — the company is examining other locations for putting up 2-3 more units.

Why multiple locations? The manufacturing process involves coating a very thin film of silicon onto a large glass panel and inscribing circuitry on the coat. For this, the company will have to move several trucks of glass panels in and out of the factory.

Dr Goel said that to produce 120 MW of PV modules, 10,000 trucks would need to be pressed into service. This would be too much of a strain on any infrastructure. Hence, a company would have no choice but to put up multiple manufacturing units.

Dr Goel said that solar power is bound to gain favour because, on the one hand, electricity produced by fossil fuels is getting costlier while on the other, cost of PV modules is coming down due to advancement in technology. “The crossover point will occur in the next 3-4 years,” he said.

Today, it costs about $5 per Watt of installed solar power generation capacity, down from $8 a year ago. Dr Goel is confident that costs will drop to around $3 per Watt.

At this level, solar power will cost just as much as conventional power, he said.

Signet Solar will initially export most of its production, but will serve the Indian market as domestic demand picks up.

The company has applied for benefits under Government of India’s ‘Semicon policy’. Under this policy, the Government promises to contribute a fifth of the project cost as equity.

A number of companies have announced their intention to put up PV module manufacturing facilities in India. Some of them are Titan Energy (which expects to invest $750 million), Solar Semiconductor ($1 billion), Moser Baer, Chandradeep Solar, Photon Energy Systems and Ram Terra Solar.