Singapore Rec
- 1. Renewable
SINGAPORE PRESS CONFERENCE
Renewable
Energy
Energy
Corporation
October 26, 2007
Corporation
Silicon
Silicon
Materials
Materials
Wafers
Wafers
Cells Modules
Cells Modules
- 2. Singapore
Press
Conference
Disclaimer Oct. 26, 2007
This Presentation includes and is based, inter alia, on forward-looking information and statements that are
subject to risks and uncertainties that could cause actual results to differ. These statements and this
Presentation are based on current expectations, estimates and projections about global economic
conditions, the economic conditions of the regions and industries that are major markets for REC ASA and
REC ASA’s (including subsidiaries and affiliates) lines of business. These expectations, estimates and
projections are generally identifiable by statements containing words such as ”expects”, ”believes”,
”estimates” or similar expressions. Important factors that could cause actual results to differ materially from
those expectations include, among others, economic and market conditions in the geographic areas and
industries that are or will be major markets for REC’s businesses, energy prices, market acceptance of new
products and services, changes in governmental regulations, interest rates, fluctuations in currency
exchange rates and such other factors as may be discussed from time to time in the Presentation. Although
REC ASA believes that its expectations and the Presentation are based upon reasonable assumptions, it
can give no assurance that those expectations will be achieved or that the actual results will be as set out in
the Presentation. REC ASA is making no representation or warranty, expressed or implied, as to the
accuracy, reliability or completeness of the Presentation, and neither REC ASA nor any of its directors,
officers or employees will have any liability to you or any other persons resulting from your use.
This presentation was prepared for the Singapore press conference on October 26, 2007. Information
contained within will not be updated. The following slides should be read and considered in connection with
the information given orally during the presentation.
The REC shares have not been registered under the U.S. Securities Act of 1933, as amended (the
quot;Actquot;), and may not be offered or sold in the United States absent registration or an applicable
exemption from the registration requirements of the Act.
2 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 3. Singapore
Press
Conference
The world’s most integrated solar energy company Oct. 26, 2007
Wafers Cells Modules
Silicon Materials
Casting and cutting Surface treatment Assembly Installation and operation
Chemical process
3 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 4. Singapore
Press
Conference
Solar energy opportunity Oct. 26, 2007
Oil Coal Gas Nuclear Hydro Bio Wind PV Solar - other Other
Unlimited renewable
1 800
source of supply
1 600
Increasingly cost
1 400
competitive
1 200
Decentralized power
(EJ/Year)
1 000
source
800
Peak power at peak
600
time of usage
400
Environmentally
200
friendly
0
2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100
Source: solarwirtschaft.de
Declining stock of fossil fuels, climate changes and increasing competitiveness of
PV systems will boost usage of solar energy over the next century
4 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 5. Singapore
Press
Conference
Centralized versus distributed power generation Oct. 26, 2007
Power plant Transmission grid Transformer Distribution grid Customer
Price to customer
Capital cost & power loss
Capital cost & power loss
Capital cost & power loss Cost
Cost
Gross margin Cost
Cost
Cost
Wind Local PV systems
cogeneration
Gas
PV systems
Hydro
Nuclear
Coal
5 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 6. Singapore
Press
Conference
Broad range of solar power applications Oct. 26, 2007
Market size and segmentation by application
Grid connected MWp
2 000
On Grid Off Grid
1 800
1 600
Residential buildings Commercial buildings PV power plants 1 400
88 percent of market 1 200
1 000
Off grid 800
600
400
200
Home systems Water pumping Telecom Space
0
12 percent of market 2001 2002 2003 2004 2005 2006
Source: Marketbuzz, 2007
6 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 7. Singapore
Press
Conference
Oct. 26, 2007
Renewable
REC GROUP
Energy
Corporation
7 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 8. Singapore
Press
Conference
REC has outpaced the industry’s explosive growth Oct. 26, 2007
5 000
Aquired
4 500 ASiMI
4 000
Start
3 500 production in
ScanCell Start
Aquired
3 000 production in
SiTech
ScanModule
2 500
2 000
Established
Start
1 500 Solar Grade
production in
Silicon
ScanWafer
1 000
500
0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Capacity expansions
8 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 9. Singapore
Press
Conference
REC Group facts Oct. 26, 2007
Headquarters in Oslo
Production facilities: 3 sites in
Norway, 2 in the USA, 1 in
Sweden
1/3 JV ownership of EverQ in
Germany
~1 650 employees
~600 in REC Silicon
~600 in REC Wafer
~400 in REC Solar
~ 40 in REC Corporate
~900 employees in EverQ
9 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 10. Singapore
Press
Conference
Unchanged production target, except within REC Silicon Oct. 26, 2007
Q3 2007
106 MW multi 12 MW cells
Production ~1 500 MT polysilicon
10 MW mono 9 MW modules
+4 % +52 % +11 %
2007 versus 2006
First nine months 2007
337 MW multi 35 MW cells
Production ~4 200 MT polysilicon
28 MW mono 31 MW modules
-1% + 75 % + 40 %
2007 versus 2006
Targets 2007
~465 MW multi ~50 MW cells
Production ~5 700 MT polysilicon
~35 MW mono ~45 MW modules
10 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 11. Singapore
Press
Conference
REC Group - Financial highlights Oct. 26, 2007
Revenues (NOK million) EBITDA (NOK million) EBIT (NOK million)
Margin: 43 % Margin: 33 %
- 3%p - 4%p
1 800 1 000 800
900
1 600 700
800
1 400
600
700
1 200
500
600
1 000
500 400
800
400
300
600
300
200
400 200
100
200 100
0
0 0
Q1 Q2 Q3 Q4
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
85 131 250 364
367 474 755 857 2005 53 88 185 275
2005 2005
380 387 522 676
872 1003 1139 1320 2006 298 303 422 552
2006 2006
869 812 643
1616 1673 1480 2007 737 679 495
2007 2007
Growth: +85 % +67 % +30 % Growth: +129 % + 110 % + 23 % Growth: +147 % +124 % +17 %
11 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 12. Singapore
Press
Conference
Oct. 26, 2007
Renewable
WAFERS, CELLS AND MODULES
Energy
Corporation
12 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 13. Singapore
Press
Conference
Producing multicrystalline wafers with proprietary technology Oct. 26, 2007
The resulting
Solar grade
silicon is first put massive ingot is cut
in crucibles… into 16 blocks...
...and melted in
special furnaces
Then cooled from the
...each again
bottom; crystallization
sliced into leaf-
begins..
thin wafers
...and Producing the
multicrystalline thinnest wafers in
silicon is formed Europe
13 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 14. Singapore
Press
Conference
REC Wafer – Bringing market leadership further Oct. 26, 2007
Wafer production* (MW/year)
Additional 650 MW of new capacity
1 800
from two new wafer plants under
SiTech
Glomfjord extention
construction at Herøya, Norway
1 600
SWH III & IV
As is & under ramp-up
110 MW of new capacity through
1 400
extension of existing plant in
1 200
Glomfjord, Norway
1 000
275 MW mono wafer capacity in
800
Glomfjord, Norway
600
400
200
0
2006 2007e 2008e 2009e 2010e
* Efficiency assumptions: 15% multi and 20% mono
Wafer production capacity will exceed ~1 600 MW from 2010
14 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 15. Singapore
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Conference
From wafers to modules … and into the market Oct. 26, 2007
Screen printing
Wafer
Soldering
Wet chemistry
Encapsulation
Doping
and testing
Anti reflective
Distribution
coating
15 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 16. Singapore
Press
Conference
REC Solar – Climbing up the ranks Oct. 26, 2007
180 MW of new cell capacity in Narvik Cell and module production (MW/year)
Additional 105 MW module capacity in 250
Glava, Sweden Cell
Module
Further growth initiatives will focus on:
200
– Economies of scale
– Increased level of automation
150
– Proprietary technology development
JV, M&A, toll-production and
100
outsourcing opportunities being
evaluated
50
0
2005 2006 2007e 2008e 2009e 2010e
16 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 17. Singapore
Press
Conference
Oct. 26, 2007
Renewable
MAIN FOCUS AREAS
Energy
Corporation
17 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 18. Singapore
Main focus areas Press
Conference
1. Cost competitiveness of PV electricity, slide 1 of 2 Oct. 26, 2007
1.0
900 hrs/year:
~0.50 €/kWh
0.8
1 800 hrs/year:
~0.25 € /kWh
0.6
(€/kWh)
0.4
0.2
0.0
1990 2000 2010e 2020e 2030e 2040e
Photovoltaic Utility peak cost Bulk cost
Source: REC, based on EC Vision Report 2005 (EPIA: Towards an Effective Industrial policy for PV (RWE Schott Solar))
18 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 19. Singapore
Main focus areas Press
Conference
1. Cost competitiveness of PV electricity, slide 2 of 2 Oct. 26, 2007
REC 2010 cost road map
REC Silicon targets ~60 percent
Figures in %
reduction in polysilicon cost input
100 %
– Main benefits will be derived from the
90 %
FBR-plant and lower consumption
Polysilicon
80 %
REC Wafer targets ~50 percent
70 %
reduction in wafer conversion cost
Wafer
60 % – Achieved ~15 percent in 2006
50 % – Further advanced technologies to be
implemented in new production lines
40 %
Cell
REC Solar targets significant
30 %
reduction in cell and module cost
20 %
input
Module
10 %
– Achieved ~10 percent in cell and
~5 percent in module in 2006
0%
World Class REC 2010
– Further advanced technologies to be
1 2
2005 Ambition
implemented in new production lines
Source: REC
Note 1: Cost structure as cost per watt of modules, based on world class production 2005
Note 2: Cost structure as cost per watt of modules, relative to 2005 level
19 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 20. Singapore
Main focus areas Press
Conference
2. Technology development Oct. 26, 2007
REC
REC
Wafer
Silicon
Furnace technology
Silane technology
Automated wafering
Unsurpassed polysilicon
processes
purity
Thin wafers
New polysilicon technology
breakthrough (FBR)
REC
Solar
State-of-the-art production
technologies
High level of automation
20 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 21. Singapore
Main focus areas Press
Conference
3. Organizational development Oct. 26, 2007
Putting safety first
Leveraging organizational capacity and
effectiveness
Infusing, retaining and developing talent
Enhancing goal- and result-orientation at all
levels
Focusing on strong leadership capability
Embracing diversity while Building a unified team
Living our Values!
21 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 22. Singapore
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Conference
Expansion projects – schedule on track Oct. 26, 2007
Project Capacity Investment 2007 2008 2009 2010
Moses Lake 6 500 ton (865 MW) USD 660m
Butte 1 000 ton (135 MW) USD 50m
Moses Lake/Butte 6 000 ton (800 MW) USD 485m
Herøya III 325 MW NOK 1 250m
Herøya IV 325 MW NOK 1 250m
Glomfjord (multi) 60 MW NOK 140m
Glomfjord (multi) 50 MW NOK 200m
Glomfjord (mono) 275 MW NOK 1 350m
Narvik 90 MW + 90 MW NOK 700m
Glava 55 MW SEK 110m
Glava 50 MW SEK 74m
Planning/Construction Ramp up Full production
22 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 23. Singapore
Press
Conference
Oct. 26, 2007
SINGAPORE SELECTED FOR
Renewable
Energy
NEW SOLAR SITE
Corporation
23 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 24. Singapore
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Conference
Comprehensive process towards selecting Singapore Oct. 26, 2007
A long process - of nine
months
Screening of more than
200 possible locations in
18 countries on 3 continents
Due diligence of almost
20 locations and
Final negotiations with a
handful of sites
24 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 25. Singapore
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Conference
Singapore – Key rationale Oct. 26, 2007
Singapore
Agreement signed with the
Singaporean governmental agency
Economic Development Board
– Located in Tuas View in West Singapore
– 30 minute drive from the centre of
Singapore City
REC has finalized a comprehensive
Singapore
support package, including incentives
and grants
– Tax Tuas
City
View
Centre
– R&D and process improvement
– Human resource recruitment and training
Singapore represents the ideal
balance between financial return,
risks and future opportunities 1:350 000
10 kilometer
25 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 26. Singapore
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Conference
REC activities in Singapore Oct. 26, 2007
Birds Eye View from South – West
Manufacturing
– Solar wafers
– Solar cells
– Solar modules
R&D activities, incl.
– Process innovation
– Factory automation
Solar value chain cost optimization
processes
Incorporates utilities, infrastructure
and support facilities, as well as an
on-site supplier park
26 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 27. Singapore
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Conference
Worldscale integrated solar manufacturing complex Oct. 26, 2007
Street View from South – West
Site description
– Possibly the world’s largest integrated solar
manufacturing complex
Complex will be integrated
– Will be developed in stages
– Production capacity may reach 1.5 GW
– Value chain will not be balanced
– Investment could reach around EUR 3
billion over 5 years
– Total number of employees could be
around 3 000 people
Pre-engineering has commenced
– First investment decision will be taken
when pre-engineering is completed
Production expected to start no later
than 2010
27 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 28. Singapore
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Conference
Exciting careers in a future oriented industry Oct. 26, 2007
Great need for competencies
– Engineers and technicians
– Skilled production operators
– Business managers
Comprehensive training
programs
Planned collaboration with
Singapore research
institutions
28 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007
- 29. Singapore
Press
Conference
Oct. 26, 2007
Renewable
Delivering on the promise of solar
Energy
Corporation
29 © Copyright 2007 Renewable Energy Corporation ASA. All Rights Reserved ⎮ Oct. 26, 2007