Chinese module manufacturer Jolywood Solar has signed an agreement with the government of Taiyuan City, Shanxi Province to construct a high-purity, solar-grade polysilicon factory as it attempts to offset surging raw material costs and push for greater vertical integration.
The facility in the north of China will have will have an annual production capacity of 100,000MT for polysilicon and 200,000MT for silicon metal once fully completed.
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It will be built in two stages, taking five years to complete. Jolywood estimates it will cost around RMB14 billion (US$2.22 billion).
The two parties will form a joint venture (JV) company to manage the project, which will be 51% owned by Jolywood.
The investment is Jolywood’s first involvement in polysilicon production and is based on the company’s strategic development needs and an assessment of market conditions moving forward, Jolywood said in a stock market notice.
Jolywood hopes the investment can offset price pressures caused by the rising cost of polysilicon, which has soared in the past two years and now stands at RMB243/kg, according to PV InfoLink.
The first phase of the project will start this year, cost RMB4.3 billion (US$667 million) and will have a production capacity of 200,000 tons of industrial silicon and 10,000 tons of high-purity polysilicon. Jolywood said it will come online by 2024. The second phase will depend on market conditions, the manufacturer said.
