Plans by Ascent Solar to build a JV manufacturing plant with the Municipal City of Suqian in Jiangsu Province, China have been revised but the plan remains on track.
Having initially announced the JV agreement in July 2013, Ascent Solar noted a series and changes to the deal as well as revealing the expected production capacity ramp for the facility.
100MW CIGS fab
The company noted that the JV would build a 100MW CIGS thin-film manufacturing plant space in the Suqian Economic and Industrial Development Science Park.
However, the initial production capacity would be 25MW and be fully operational in the first quarter of 2016, with the 100MW ramp taking place over a six-year period.
Suqian was originally said to be providing cash of approximately US$32.5 million for the JV and retain a minority share. However, under the revised agreement, Suqian is expected to provide approximately US$4.8 million in cash and have a majority interest of 75% in the JV.
The municipality would then invest the balance of the US$32.5 million during 2014, according to the Ascent Solar statement. Ascent Solar is investing approximately US$1.6 million in cash and will hold a minority interest of 25%.
The manufacturing plant details have also been revised from a facility 27,000 square feet to one significantly larger at 331,000 square feet. A five-year rent-free period will also be part of the deal.
Ascent Solar will also purchase the plant within five years at the initial construction cost, and would also hold the right to purchase Suqian's ownership interest in the JV after five years at 1.5 times of Suqian's cash cost.
However, that ownership value would be diluted significantly by then as the deal will see Ascent Solar’s JV ownership increase to 80% before the end of the five year period based on it providing the proprietary technology and intellectual property, as well as certain equipment from its Colorado facility.
The company also noted that in a ‘Phase two’ plan, Ascent would have the option to purchase approximately 215,000 square feet of land zoned for commercial usage at the park that could generate income for Ascent in the future.
Lan Shao Min, governor of the Municipal City of Suqian said: “The Suqian government is fully committed to this partnership and shall provide the utmost support and incentives to Ascent. We are convinced that CIGS, and more specifically Ascent's proprietary CIGS technology utilising a flexible plastic substrate, is the next breakthrough in photovoltaics. The aim of our alliance with Ascent is to build a state-of-the-art industrial park in Suqian for solar and solar-related products, anchored by Ascent’s manufacturing presence, as well as equipment suppliers, contract manufacturers and other supporting industries.”
The CIGS plant is expected to be dedicated to fabricating Ascent’s EnerPlex brand of consumer related products.