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Revived Interest in CIGS Creating Real Opportunities in Photovoltaics

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In the laboratory, copper indium gallium (di)selenide (CIGS) has achieved the highest champion cell efficiencies (over 20%) of all thin-film photovoltaic (TFPV) technologies. CIGS has not, however, lived up to predictions about is ability to compete with crystalline silicon (c-Si). A combination of manufacturing issues and the global economic downturn significantly impacted the sector. Recent capacity expansions, a dramatic increase in the number of market players and growing investment activity are signaling renewed interest, though. NanoMarkets, a leading provider of market research and analysis of the opportunities in advanced materials and emerging energy and electronics markets, expects revenues from CIGS consumed in PV applications to grow from $613.4 million in 2011 to $5.41 billion in 2018.

The material for this paper was drawn from the NanoMarkets report, CIGS Photovoltaics Market Opportunities 2011

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Revived Interest in CIGS Creating Real Opportunities in Photovoltaics

  1. 1. NanoMarkets www.nanomarkets.net Revived Interest in CIGS Creating Real Opportunities in Photovoltaics A NanoMarkets White Paper Published September 2011 © NanoMarkets, LCNanoMarkets, LCPO Box 3840Glen Allen, VA 23058Tel: 804-360-2967Web: www.nanomarkets.net
  2. 2. NanoMarkets www.nanomarkets.netEntire contents copyright NanoMarkets, LC. The information contained in this report is based on thebest information available to us, but accuracy and completeness cannot be guaranteed. NanoMarkets,LC and its author(s) shall not stand liable for possible errors of fact or judgment. The information inthis report is for the exclusive use of representative purchasing companies and may be used only by Page | 2personnel at the purchasing site per sales agreement terms. Reproduction in whole or in any part isprohibited, except with the express written permission of NanoMarkets, LC. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  3. 3. NanoMarkets www.nanomarkets.netRevived Interest in CIGS Creating Real Opportunities inPhotovoltaicsIn the laboratory, copper indium gallium (di)selenide (CIGS) has achieved the highest champion cellefficiencies (over 20%) of all thin-film photovoltaic (TFPV) technologies. CIGS has not, however, lived Page | 3up to predictions about is ability to compete with crystalline silicon (c-Si). A combination ofmanufacturing issues and the global economic downturn significantly impacted the sector. Recentcapacity expansions, a dramatic increase in the number of market players and growing investmentactivity are signaling renewed interest, though. NanoMarkets, a leading provider of market researchand analysis of the opportunities in advanced materials and emerging energy and electronics markets,expects revenues from CIGS consumed in PV applications to grow from $613.4 million in 2011 to $5.41billion in 2018. CIGS Revenues 2011-2018 6,000 5,000 4,000 $ Millions 3,000 2,000 1,000 0 2011 2012 2013 2014 2015 2016 2017 2018 © NanoMarkets, LCThe CIGS AdvantageNanoMarkets believes that CIGS has a huge market advantage over other thin-film photovoltaic (TFPV)technologies. Not only can it be used to create lightweight, flexible, thinner modules than other TFPVoptions, commercial CIGS modules are over 13% efficient, with some firms reporting best cells with 14-16% efficiency. In fact, NanoMarkets expects that CIGS will be the only TFPV technology that might beable to compete with conventional c-Si PV technology where C-Si is already established. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  4. 4. NanoMarkets www.nanomarkets.netAlong with its high-performance capability, the flexibility of CIGS modules continues to be a criticaladvantage. With this technology, flexible substrates for flexible devices with twice the efficiency ofexisting flexible products can be created. Less expensive processes, cheaper substrates and the needto use much less material for CIGS PV compared to c-Si leads NanoMarkets to predict that CIGS willsomeday achieve price parity with c-Si PV, which will open up new markets that other types of TPFV Page | 4have not had access to.Three Key MarketsNanoMarkets has identified three markets that will provide opportunities for growth in the CIGS PVsector: the conventional panel market, the building integrated photovoltaics (BIPV) market and themobile power market for portable electronics.The conventional panel market: The first target for CIGS will be the conventional panel market, whichis becoming commoditized and thus very competitive from a price/performance perspective.NanoMarkets expects that costs will fall below $1/watt by 2014. The manufacturing concerns aboutCIGS (see below) do raise some question as to whether or not this technology can compete effectively.If CIGS efficiencies reach 15% by 2014 as expected, however, CIGS could potentially be sold at a pricepoint closer to that of c-Si PV than other TFPV technologies.And for applications where glass encapsulation is not possible, if CIGS suppliers can prove that CIGSencapsulation technologies provide competitive lifetimes, they should be able to compete onefficiency and cost in the c-Si PV panel market.Finally, while CIGS PV can be used in residential installations and utility-scale projects, NanoMarketsbelieves that CIGS PV panel manufacturers should target conventional panel opportunities whereweight is an important concern, such as rooftop installations.Rigid and flexible BIPV: CIGS PV is well suited for the BIPV market. The flexibility of CIGS panels is areal advantage that cannot be matched by cSi, and therefore the largest percentage of CIGS PV saleswill be to the flexible BIPV market. However, NanoMarkets believes that CIGS is also suitable for rigidtiles and BIPV glass due to its lighter weight, capability for direct deposition onto glass or metal, andhigher power than thin-film silicon. And while CIGS’ sensitivity to moisture is a concern and currentencapsulation solutions are typically high cost, BIPVs are generally higher cost materials and thus canoften absorb the additional expenses.Rigid BIPV is a natural fit for CIGS for several reasons: The uniform appearance of CIGS gives better aesthetics, CIGS provides continuous production of power under indirect or steep angled illuminations with less of a power drop than c-Si, and CIGS offers high efficiency NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  5. 5. NanoMarkets www.nanomarkets.netNanoMarkets believes that the lighter weight and greater efficiency of CIGS combined with itspotentially lower cost and aesthetic advantages could give it a real edge. CIGS panels also come in awide range of sizes, can be uniformly black, grey or other colors or have visible pattered dark or silverlines, and can be custom designed to fit the tile products they go with, making them ideally suited toBIPV. Page | 5BIPV glass applications will also benefit from the aesthetic advantages of CIGS PV. And because CIGSPV is usually built on glass anyway, producing BIPV CIGS products requires only switching toarchitectural glass. In fact, NanoMarkets believes that the natural fit of CIGS PV in this market resultsin improved aesthetics, greater integration of PV into the final BIPV product, and a greater ability tohide the PV costs in the overall cost of the building materials, all of which add up to betteropportunities for increased margins.Flexible BIPV panels are laid onto a roof or attached to roofing materials prior to installation.NanoMarkets believes they are an important opportunity for flexible CIGS PV manufactures. Laminatesor overlays can also be installed onto any surface to which they can be glued – walls, doors, fences,etc., and direct marketing to end-users of these types of installations is another opportunity for CIGSPV suppliers.More advanced BIPV products, where the PV cells are well integrated into the building materials sothat the cost of the PV cannot be separated from the cost of the building materials, offer a morelucrative market. In this case, it is easier for the building owner to recoup the cost of installing BIPVthrough lower utility bills.One example of such a product is Dow Chemical’s POWERHOUSE shingle using CIGS PV cellsmanufactured by Global Solar and targeted for launch in 2011. NanoMarkets expects this product tobe highly profitable. This strategy provides an opportunity for CIGS suppliers to become directlyinvolved in fully-integrated products with mass market appeal. And because the cost of PV appears tobe lower, it is more attractive for the end-user. With its higher efficiency, CIGS PV is ideal for thisapplication.Portable electronics: Most portable electronics that contain portable PV devices rely on dye-sensitizedcell (DSC) or organic PV (OPV) technologies, but CIGS is suitable for this market and can provide thehighest power PV systems. Most uses are in solar battery chargers. The market is much smaller thanthe BIPV and conventional solar panel sectors, but the margins are likely to be quite large. CIGSsuppliers could develop their own line of stylish products to encourage adoption or partner with high-end consumer products companies, a strategy adopted by leading producer Global Solar.Other possible applications for CIGS PV include PV-active clothing, umbrellas, tents, bags, etc. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  6. 6. NanoMarkets www.nanomarkets.netChanging DemandCurrently the conventional panel market accounts for 98% of sales, but that will drop to 66% in 2018,with BIPV picking up the majority of the difference. BIPV currently represents a very small market forCIGS PV, but will have the largest revenues by 2018, growing nearly 175%. This growth will be largelydriven by flexible BIPV products, but there will also be significant increases in demand for CIGS in rigid Page | 6BIPVand BIPV glass. Revenues from sales of CIGS PV into other flexible product applications will alsoincrease dramatically (~46 times) from a very small base.Overcoming SensitivitiesA major drawback of CIGS PV compared to crystalline silicone is its moisture sensitivity. Conventionalpanels and other rigid products don’t have this problem. As a result, flexible encapsulation is a majorcomponent of flexible CIGS development.The most robust approach today involves the use of dyadic systems, which are comprised ofalternating layers of two different materials, usually polymers and ceramics. But this approach requiresmany layers to be really effective, and that adds cost. Furthermore, the deposition and curingconditions can potentially hurt the cells.As a result, there is pent up demand for less costly and simpler technologies. Recent developments arein part helping drive the growing interest in CIGS. Major chemical companies including Dow Chemical,Fujifilm, 3M (working with SoloPower) and DuPont (working with the US Department of Energy) haveall announced progress in encapsulant technologies for CIGS PV.NanoMarkets believes that, ultimately, the opportunities for encapsulation will depend on the PVapplication. For portable products with a minimum expected lifespan, low cost encapsulation thatprovides a minimum level of performance will likely be satisfactory. For flexible BIPV that is expectedto last for decades, very robust encapsulation will be necessary. It is in these applications that therecent developments mentioned above will enable CIGS to achieve its true market potential.The Question of Indium SupplyCIGS producers face uncertainty in indium supply and pricing. The display industry is the largestconsumer of indium (in the form of indium tin oxide (ITO) for transparent conductors, and demand ispredicted to increase as this market continues to expand. Furthermore, indium prices have risenrecently and are expected to continue to climb over the next several years.Much of the pricing issue has arisen as the result of actions taken by the Chinese government to limitexports. There are active indium sources in North America and Australia with stockpiles ofconcentrates, and they now have incentive to sell this inventory. It is uncertain how quickly suchactivities would impact the market, however. Historically the industry has been slow to respond tosupply/demand swings. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  7. 7. NanoMarkets www.nanomarkets.netThe Manufacturing IssueCIGS producers are still faced with the challenge of producing high efficiency cells on a commercialscale. Performance depends on quality, so when developing production methods, the difficulty andcost of creating CIGS films must be balanced with quality and performance. Page | 7Conventional vacuum deposition methods including sputtering and evaporation are well understood,available and have lead to the highest performing cells. Over 90% of the CIGS PV produced today isvacuum deposited.Quality is an issue when these processes are scaled up, however. Metal waste is also seen as a realissue for both sputtering and evaporation. And currently debate continues regarding whether to scaleup batch processes or use continuous methods to achieve faster processing and larger substrates. Todate, the largest growth has been in rigid, batch processing, most likely because it is widelyunderstood and been demonstrated to achieve volume production in the tens of megawatts.NanoMarkets predicts, however, that a gradual shift will take place from these classical methods toalternatives such as electrodeposition, roll-to-roll (R2R) and printing.Electrodeposition: Electrodepostion utilizes simple precursors and relatively low cost equipment, andmargins are not significantly affected if the plant is run at lower than capacity. The technique is alsomore efficient than conventional methods in terms of energy consumption and waste generation. Forthese reasons, NanoMarkets believes that electrodeposition of CIGS may offer a strong entry point fora number of firms. Odersun is the currently the clear leader with the largest commercial productioncapacity. Others using electrodeposition include SoloPower (commercial), NEXCIS and CIS Solartechnik(pilot plant) and CIS Solar (research).Roll-to-roll: Continues R2R processes are expected to be more scalable than batch processes and areideally suited for flexible substrates. Approximately one-third of CIGS suppliers have or are developingR2R processes. Global Solar, Oderson and MiaSole have all demonstrated high volume production attens of megawatts. This process also seems well suited for smaller producers and could offer licensingopportunities to major players. Global Solar appears to be pursuing this opportunity with Istar Solarand Shurjo Energy.While rigid manufacturing presently dominates and will continue to do so, NanoMarkets expects roll-to-roll manufacturing to account for as much as 35% of the market by 2018.Printing: Printing was initially thought to be the solution for commercial scale CIGS manufacturing, butnow appears to have issues of its own, and NanoMarkets expects that printed CIGS will remain arelatively small part of the CIGS market for at least the next eight years. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259
  8. 8. NanoMarkets www.nanomarkets.netThe Competitive LandscapeAbout 50 companies are presently vying for a piece of the CIGS market compared to 20 in 2009. Manyof the newer firms are in Asia, and Nanomarkets believes that there is a special fit between CIGS andChina in particular, due to the situation with indium and the growing demand from an increasingmiddle class for demand higher value products such as those containing CIGS PV. Page | 8But NanoMarkets does not believe that the market can support 50 suppliers. About six leaders willemerge by 2012/2013, each producing over 10 megawatts and a few of those will ramp up to trulyhigh volumes. An additional dozen or so will produce tens of megawatts.New key players include Daiyang Metal and Stion/TSMC. Solar Frontier (backed by Shell) isconstructing a 900 MW factory that is expected to be fully operational in 2011. MiaSole has raised$100 million in new money and is expanding capacity.ConclusionThere is considerable evidence to suggest that CIGS makers have been correct to make suchinvestments. Applications for which CIGS is being targeted over the next several years already arebeing pursued by firms using other TFPV technologies and should be relatively easy for CIGS firms tocapture due to its higher efficiency.CIGS PV may also enable new applications where the size or low power output of other TFPVtechnologies limits their viability.Most notably, growth of CIGS will be substantial if only the announced planned capacity is actuallyinstalled and operated at modest levels. And with silicon supply problems over, c-Si PV is growingrapidly again and TFPV technologies will have a hard time competing because of their lowerefficiencies – except CIGS.For additional details about the NanoMarkets report, CIGS Photovoltaics Markets – 2011 please visitthe NanoMarkets website at www.nanomarkets.net or contact us via email atsales@nanomarkets.net or by phone at 804-270-4370. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-360-2967 | FAX: 804-360-7259

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