Tags: GE | Makes | 600 Million | Push | Solar | Energy

GE Makes $600 Million Push Into Solar Energy

Thursday, 07 Apr 2011 10:32 AM

General Electric Co. made a big push in solar power, saying it will invest $600 million to build a new factory as it pursues what it thinks could be an up to $3 billion business by 2015.

The largest U.S. conglomerate, which over the past decade has made itself a leader in renewable energy, said it has designed a thin-film solar panel that converts sunlight to electricity more efficiently than anything available on the market today.

"The biggest challenge today for the mainstream adoption of solar is cost, and the way you move cost is efficiency," said Victor Abate, vice president of GE's renewable energy unit. "We see ourselves continuing to push that and continuing to move efficiency and as a result the costs of solar continue to come down."

GE, also a leading maker of wind- and natural gas-powered electric turbines, aims to open by 2013 a U.S. factory in a yet-to-be-chosen location that will employ 400 people and produce enough solar panels each year to meet the needs of 80,000 homes.

The company also announced more than 100 megawatts of new commercial agreements for solar thin-film products, orders that Abate said would generate "hundreds" of millions of dollars in revenue.

Under Chief Executive Jeff Immelt, the company has been aggressively building out its renewable energy portfolio, starting with the wind sector, which it entered in 2002 and now generates about $6 billion in annual sales.

The company has been exploring solar since 2007 and Immelt told investors in December that he believed it could be a $2 billion to $3 billion business for GE by 2015.

GROWTH COULD STALL

The global solar industry has seen strong demand growth of more than and 30 percent annually in recent years, and panel sales topped 15 gigawatts last year largely due to a boom in business in Germany.

Still, as the key European markets begin to trim the subsidies that make solar power investments attractive, industry experts worry that growth could stall, even as panel makers ramp up production capacity.

That could lead to a glut in supplies, pressuring prices lower and squeezing profit margins for key companies such as First Solar Inc, Germany's SolarWorld AG and China's JA Solar Holding and Suntech Power Holdings.

For its part, GE argued that its 400 megawatt annual production rate will represent just 3 percent of current global demand, which is forecast at 15 gigawatts per year.

"There is plenty of headroom," Abate said.

FOCUS ON THIN FILMS

Fairfield, Connecticut-based GE said it bought the remaining stake in PrimeStar solar, a start-up company focused on thin-film solar panels that it first took a stake in 2008. The company has focused its solar efforts on thin-film technology, which the company sees as more versatile than traditional silicon-based solar panels.

The company aims to target large-scale utility solar projects, and plans to highlight its production of equipment to connect solar panels to the grid. Last week GE reached a $3.2 billion deal to buy Converteam, a French company that makes equipment to convert the sort of electricity generated by solar panels and wind turbines to a form usable by the grid.

GE shares were down less than 1 percent at $20.41 in early trading. Shares of First Solar were down 1 percent at $148.63, JS Solar was off 2 percent at $6.80 and Suntech was down 1.3 percent at $9.50.

© 2017 Thomson/Reuters. All rights reserved.

 
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General Electric Co.made a big push in solar power, saying it will invest $600 million to build a new factory as it pursues what it thinks could be an up to $3 billion business by 2015. The largest U.S. conglomerate, which over the past decade has made itself a leader in...
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Thursday, 07 Apr 2011 10:32 AM
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