Polysilicon producer, Silicor Materials, has signed German conglomerate, SMS Siemag, to supply equipment and factory design services for a planned new plant in Iceland.

California-headquartered Silicor hopes the plant will produce the world’s cheapest solar silicon via an aluminium smelting process that transforms metallurgical-grade silicon into the higher-purity variant needed for PV applications.   

Further cost advantages are expected from the location for the plant, first announced last year, which was chosen because of Iceland’s cheap geothermal energy and the availability of aluminium needed for the process. Silicor claims its process consumes two-thirds less energy than others, resulting in a lower-cost alternative variety of polysilicon. A figure of US$9/kg was touted last year.

Under the deal confirmed today with SMS Siemag, the companies will develop a plant with a guaranteed throughput of 16,000MT.

SMS will supply all the plant’s equipment as well as the technical and installation support needed to complete the plant.

Silicor said it expected the Iceland plant to be first in a series of facilities it would work on with SMS.

“The Silicor project provides the potential to fundamentally improve the supply chain for the production of solar silicon,” said Dr. Guido Kleinschmidt, member of the SMS Siemag executive board at SMS Siemag. “It is based on the environmentally friendly utilisation of Iceland’s natural resource of renewable energy, which fully complies with SMS’ ‘Ecoplants’ vision to provide ecological and economical optimised metallurgical plants.”

“We’re taking meaningful steps to get this plant off the ground in an aggressive timeframe, and the progress we’ve made in just a few months underscores our commitment to both the Icelandic community and to our customers,” said Silicor Materials CEO Theresa Jester. “SMS Siemag has nearly 140 years’ experience with projects of this type in the metals business, which makes the company a natural partner as we ramp production. Together, we are working to revolutionise the economics of the solar industry.”

Silicor has engaged Iceland’s Arion Bank to provide debt financing for the new plant.

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