20100316 investors field trip
Post on 10-Apr-2015
736 Views
Preview:
DESCRIPTION
TRANSCRIPT
MARCH 16, 2010
Field Trip
Moses Lake
March 16
2 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Disclaimer
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 analyst field trip held on March 16, 2010. 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 "Act"), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Act.
REC
Silicon
REC
GROUPIntroduction to REC Silicon
Tore Torvund
Field Trip
Moses Lake
March 16
4 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Two U.S. production facilities
MOSES LAKE, WASHINGTON
BUTTE, MONTANA
Field Trip
Moses Lake
March 16
5 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
REC Silicon in Moses Lake
FOCUS ON THE SOLAR INDUSTRY
PRODUCTS
– POLYSILICON: Solar Grade Polysilicon
– SILANE GAS
OPERATIONS
– Silicon 1.0 and Silicon 3.0 in production
– Silicon 4.0 to start production mid 2010
ORGANIZATION
– Approximately 475 employees
Field Trip
Moses Lake
March 16
6 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
REC Silicon in Butte
FOCUS ON THE ELECTRONICS INDUSTRY
PRODUCTS
– POLYSILICON: Float Zone (FZ), Electronic Grade
Polysilicon (EG)
– SILANE GASES: Monosilane & Disilane
OPERATIONS:
– Silicon 2.0
ORGANIZATION:
– Approximately 300 employees
Field Trip
Moses Lake
March 16
7 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
1983 - 1984 Construction of Moses Lake plant by Union Carbide Corporation
1990Moses Lake Plant purchased by Komatsu Ltd., creating Advanced Silicon
Materials Inc. (ASiMI)
1996 - 1998 Construction of Butte, Montana plant
2002REC enters into Joint Venture with Komatsu –
Moses Lake plant becomes Solar Grade Silicon LLC (SGS) – Silicon 1.0
2005ASiMI (Silicon 2.0) and remaining shares of SGS purchased by REC,
creating REC Silicon
2006REC Silicon breaks ground on Silicon 3.0 in Moses Lake and decides to
invest in additional debottlenecking in the Butte plant
2007 REC decides to invest in additional production capacity – Silicon 4.0
2009Start-up of Silicon 3.0
REC Silicon bought Komatsu Ltd‟s 25% ownership interest in Butte entity
2010 Silicon 4.0 scheduled to start production
REC Silicon history
REC
Silicon
REC
GROUPProducts and Markets
Field Trip
Moses Lake
March 16
9 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
What is a polysilicon plant?
A polysilicon plant consists of two separate plants working seamlessly together
Silane gas plant
Polysilicon plant (Siemens or FBR reactor plant)
POLYSILICON PLANT SILANE GAS PLANT
Field Trip
Moses Lake
March 16
10 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
POLYSILICONSILANE
GRANULAR
SOLAR GRADE
CHUNK SOLAR
GRADE
FLOAT ZONE
ELECTRONIC
GRADE
SIE
ME
NS
TE
CH
NO
LO
GY
FB
R T
EC
HN
OL
OG
Y
FOR POLY PRODUCTION
FO
R C
US
TO
ME
RS
SILANE FOR
MERCHANT
MARKET
Products and Technology
Field Trip
Moses Lake
March 16
11 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Applications of REC Silicon products
Silane
Gas
Solar Grade Polysilicon
Electronics Grade
Polysilicon
Float Zone Polysilicon
Used in production of Semiconductors,
Flat Panel Displays and Thin Film
Technologies
Applications for the
Solar Industry
Delivered to the
Semiconductor industry and
other Electronic Markets
High-purity Polysilicon for the Power
Semiconductor and emerging Green Energy
industries incl. Hybrid/Electric cars
REC
Silicon
Field Trip
Moses Lake
March 16
12 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
POLY REVENUE BY MARKET
TOTAL REVENUE BY SOURCE
Solar Grade $32M18%
Electronic Grade$80M45%
Float Zone$36M20%
OffSpec$30M17%
Internal Poly
$272M44%
Silane$166M27%
External Poly
$177M29%
Revenue segmentation - 2009
REC
Silicon
REC
GROUP
Silicon 3.0 and Silicon 4.0
updates
Field Trip
Moses Lake
March 16
14 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silicon 3.0 & Silicon 4.0
SILICON 3.0
Design capacities:
– Silane 9,000 MT
– FBR 10,500 MT
Investment:
– Total CAPEX NOK 6,000 million
In production
SILICON 4.0
Design capacities:
– Silane 9,000 MT
– Offload Capacity 3,000 MT
Investment:
– Total CAPEX NOK 4,200 million
Completion:
– Project 95% complete
Start-up:
– Scheduled start-up mid 2010
Field Trip
Moses Lake
March 16
15 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Siemens FBR Silane Loading
SilaneSilaneSilane
Silicon 1.0 Silicon 4.0Silicon 3.0
Moses Lake Plant Diagram
Field Trip
Moses Lake
March 16
16 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silicon 3.0 Silane Production History
Silicon 3.0: Silane ramp-up (March 2009 – March 2010)
FBR
Pluggage
Pluggage
Pluggage
Inspection
Pluggage
Field Trip
Moses Lake
March 16
17 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Microscopic photo of deposit material
Field Trip
Moses Lake
March 16
18 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silicon 3.0: FBR ramp-up (March 2009 – March 2010)
Silicon 3.0 Poly Production History
FBR
Lack of silane
Inspection
Lack of silane
Field Trip
Moses Lake
March 16
19 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Crack in reactor discharge pipe
The plant was shut down for process
safety reasons due to problems with a
discharge pipe
Discovered a potential for material
fatigue with the reactor discharge pipe
which could result in additional failure
Investigations indicated thermal and
mechanical stress
5 cm
Field Trip
Moses Lake
March 16
20 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silicon 3.0 - today
Silane and FBR:
Silane unit producing high quality silane for FBR source gas
Start-up equipment reliability issues resolved
Improved production and granular quality resulting from longer, more stable reactor cycles
REC
Silicon
REC
GROUPOutlook
Field Trip
Moses Lake
March 16
22 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
$0
$200
$400
$600
$800
2003 2004 2005 2006 2007 2008 2009
$0
$100
$200
$300
$400
2003 2004 2005 2006 2007 2008 2009
REVENUE ($ Million) EBITDA ($ Million)
Strong, profitable growth
Field Trip
Moses Lake
March 16
23 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
0
5,000
10,000
15,000
20,000
25,000
2007 2008 2009 2010 2011 2012
Silane production (MT)
0
5,000
10,000
15,000
20,000
2007 2008 2009 2010 2011 2012
Polysilicon production (MT)
Production volumes
Field Trip
Moses Lake
March 16
24 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Competitive polysilicon cash cost position (2010 $/Kg)
REC Silicon has a strong cost position
based on:
Large scale production
25 years of experience
Favorable energy cost
New technology
– Target FBR cash cost below 20 $/kg
Sources: Sage Concepts; Company presentations; Equity Analyst
Reports; REC Silicon Field data.
Field Trip
Moses Lake
March 16
25 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
REC Silicon - Summary
Strong position in growing markets for
Polysilicon and Silane, and recognized track
record
Proprietary REC technology for Polysilicon with
considerable lower energy consumption and
better form factors
Strong growth in production from 8,000 Metric
tons (2009) to 17,000 Metric tons (2012)
Very attractive cost position
Experienced organization with 25 years of
know-how
REC
Silicon
REC
GROUPThank you
REC
Silicon
REC
GROUPMarket Update
Kurt Levens
Field Trip
Moses Lake
March 16
28 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Contents
Products & Markets
Market Drivers
Polysilicon
Float Zone
Silane
Conclusion
REC
Silicon
REC
GROUPProducts & Markets
Field Trip
Moses Lake
March 16
30 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
It starts with the silane molecule
Enables all silicon deposition
applications
Purest silicon precursor
More than 25 years of experience
Silane allows optimization of product
mix for value creation, unlike
trichlorosilane (“TCS”)
Signature Silane TM
Signature
Silane TM
Field Trip
Moses Lake
March 16
31 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silane Molecule – allows optimization of product mix
Silane
SiH4
Field Trip
Moses Lake
March 16
32 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Global presence – world class customers
ASIA44%
N. AMERICA7%
EUROPE49%
2009 Sales
$626.8 MM
Field Trip
Moses Lake
March 16
33 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Contracts
Silane
– 90% declining to 50% of the expected sales volume are under contract over the next 5 years
– Long term contracts are for fixed volumes with provisions for incremental yearly volume
– Prices are fixed with provisions for market conditions
Float Zone
– 50% moving to 90% of future volumes are under contract
– Long term contracts are for fixed volumes and variable volumes set within a min/max band
– Currently finalizing multiple contracts
Electronic Grade Contracts
– 80% of potential output is under long term contract
– Long term contracts are for fixed volumes and variable volumes set yearly within a min/max band
– Prices are fixed, market based or variable within a min/max band
Solar Grade Polysilicon Contracts
– 83% of total output is under long term contract
– Long term contracts are for fixed volumes and variable volumes set yearly within a min/max band
– Prices are fixed, market based or variable within a min/max band
REC
Silicon
REC
GROUPMarket Drivers
Field Trip
Moses Lake
March 16
35 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Electronic Grade
Polysilicon
Float Zone Polysilicon
Silicon GasSolar Grade Polysilicon
Key market drivers
Flat Panel (TFT) PhotovoltaicsSemiconductor
Field Trip
Moses Lake
March 16
36 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Source: IC Insights (February 2010)
-25 %
-15 %
-5 %
5 %
15 %
25 %
35 %
45 %
55 %
0.0
50.0
100.0
150.0
200.0
250.0
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
00
01
02
03
04
05
06
07
08
09
10F
11F
12F
13F
14F
UnitGrowth %
BillionUnits
IC UNITS GROWTH RATE
Semiconductor – Worldwide unit shipments
Field Trip
Moses Lake
March 16
37 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Data set above derived from external sources: 2004-2008 via Solarbuzz LLC; 2009-2013 demand points conglomerated from EPIA, Bloomberg New Energy Finance,
Solarbuzz, Barclays, UBS, ML-BofA, Piper Jaffray, Deutsche Bank, DisplaySearch, Displaybank Korea, iSuppli, Linx, Alternative Energy Consulting, Navigant & Sage
Concepts. PV Demand High is the 2nd highest demand assumption from this set, whereas PV Demand Low is the 2nd lowest demand forecast. PV Demand Median presents
the median of all data points.
-
5,000
10,000
15,000
20,000
25,000
30,000
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
MWp
PV DEMAND HIGH PV DEMAND MEDIAN PV DEMAND LOW
Photovoltaics (PV) – Demand projections
Field Trip
Moses Lake
March 16
38 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
0
50,000
100,000
150,000
200,000
250,000
300,000
00
0 m
2
0%
10%
20%
30%
40%
50%
60%
70%
Gro
wth
000 Sbstr 16,492 21,313 26,741 32,681 39,308 48,302 57,549 66,507 73,452 76,421 83,303 85,839 89,136 92,696 95,370
000 m2 4,556 7,083 10,261 15,116 23,782 38,923 60,443 85,759 110,157 134,288 162,351 182,353 204,497 226,075 246,387
Area Grwth 55% 45% 47% 57% 64% 55% 42% 28% 22% 21% 12% 12% 11% 9%
Sbstr Grwth 29% 25% 22% 20% 23% 19% 16% 10% 4% 9% 3% 4% 4% 3%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Flat Panel (TFT) – Display area growth
Source: DisplaySearch (December 2009)
Field Trip
Moses Lake
March 16
39 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Market wrap-up
SEMICONDUCTOR
Square inches of wafer consumed is forecast at +26% year on year
Memory devices will lead growth and may be in short supply
Semiconductor content of everyday life will continue to expand
Large volume device demands driven by emerging countries
PHOTOVOLTAIC (PV)
PV price pressure persists and cost reduction pressures increasing; market remains
strongly geographically dependent
Increased utility activity in US and China
True demand is still best characterized as a range
FLAT PANEL (TFT)
LCD Monitor Production Expected to Reach All-Time High in Q1 2010
Gen 6 & larger fabs expected to average 87%+ fab utilization rate this year
Focus on growth will be in China over the next 2-3 years
REC
Silicon
REC
GROUPPolysilicon
Field Trip
Moses Lake
March 16
41 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
REC Polysilicon products
Siemens Product
Very dense and hard material
Requires further processing before use
Most common production method currently
Preferentially used in semiconductor applications
Expensive cost structure for most PV applications
ROD-CHUNK-TEAR DROPSIEMENS TECHNOLOGY
GRANULAR POLYSILICONFBR TECHNOLOGY
Granular Product
Flowable form factor
Ready to use for customer application
Currently target of focused research and
development by industry
Preferentially used in PV due to cost versus
performance benefits
Lowest cost production method
Field Trip
Moses Lake
March 16
42 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Customer acceptance for FBR products
Applications
– Silicon 3.0 FBR products have been qualified and accepted in 6 different applications
Customers
– 18 different customers in 8 countries on 3 continents have used or are currently using Silicon 3.0 FBR products
Markets
– The majority of applications are for PV silicon wafers
– Other applications are also currently using FBR due to its preferrable form factor properties
Field Trip
Moses Lake
March 16
43 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
0
50,000
100,000
150,000
200,000
250,000
2010 2011 2012 2013
MT
SUPPLY INCUMBENTS SUPPLY NEW ENTRANTS BASELINE DEMAND MODERATE DEMAND OPTIMISTIC DEMAND
Potential supply from “Incumbents” take into account production forecasts from Hemlock, Wacker, REC, MEMC, Tokuyama, Mitsubishi , Osaka Titanium , plus OCI
and GCL-Poly. All the rest are classified as “New Entrants.” Supply data excludes UMG-Si. Demand Scenarios include “High, Median & Low” consumption forecasts
from PV, Semi and Other demand.
Potential supply vs. demand scenarios
Field Trip
Moses Lake
March 16
44 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Polysilicon prices
0
50
100
150
200
250
300
350
400
450
500
$/kg
SPOT PRICES CONTRACT PRICES
Sources: Photon Consulting, Bloomberg New Energy Finance, Sage Concepts & REC data.
Field Trip
Moses Lake
March 16
45 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
- 20,000 40,000 60,000 80,000 100,000 120,000 140,000
CA
SH
CO
ST
($/k
g)
POLYSILICON STACKED SUPPLY (2010, MT)
Market leaders are best positioned - Polysilicon
Sources: Sage Concepts; Company presentations; Equity Analyst Reports; REC Silicon Field data.
Field Trip
Moses Lake
March 16
46 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Focus during the past 5 years has been on ramping up polysilicon production capacity as quickly as possible
2010-2013 will be challenging years for some companies
At times spot prices will move to the cash cost of that higher-cost manufacturer which fulfills that last kilogram of
demand
On the overall macro environment, a sharp contrast will develop between the “haves and have nots” as defined by:
secure market channels, cost, quality and value creation networks
Upstream companies will be looking at ways to create more value from their molecules
Those who chose their customers and suppliers well will absorb demand
REC Silicon is well positioned in terms of cost, product quality and reputation, customer channels and stability of
suppliers
Market summary - Polysilicon
REC
Silicon
REC
GROUPFloat Zone
Field Trip
Moses Lake
March 16
48 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Float Zone
Float Zone (FZ) is a manufacturing method for fabricating very pure silicon; the concentration of impurities
(e.g. carbon, nitrogen & oxygen) are extremely low
FZ segregates impurities during the liquid-to-solid transition; liquid zone is moved through the material, and when
properly seeded, a single crystal occurs
Melt never comes into contact with anything but vacuum or inert gases; FZ has 3x less oxygen than CZ ingots
Field Trip
Moses Lake
March 16
49 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Float Zone market opportunities
Power Devices
Home
Appliances
Computing
Existing
Applications
Field Trip
Moses Lake
March 16
50 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
IGBT for hybrid-electric vehicle converter
Hybrid-electric vehicle application
The fastest growing FZ application
1-3 million EV/HEV are expected to be
produced in 2010
CAGR expected to be 35-50% from 2010 to
2015
Most hybrid vehicles use a specific transistor
for the converter
FZ substrates are preferred for this specific
device
Field Trip
Moses Lake
March 16
51 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Renewable energy applications
FZ wafer
Die
IGBT Modules
DC/AC, AC/DCconverter
IGBT valve in
700kW DC/AC
AC/DC converter
Offshore
Inland
IGBT valve in
600MW HVDC
substation
Field Trip
Moses Lake
March 16
52 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
FZ Polysilicon market growth projections
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2002 2003 2004 2005 2006 2007 2008 2009 2010F 2011F 2012F 2013F 2014F 2015F
MT
Forecast for 2010-2015 based on MSI growth rates derived from SEMI (2009-2011), Sage Concepts (2009-2011) and Yole Développement (2010-2015).
Field Trip
Moses Lake
March 16
53 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Market summary – Float Zone
Float Zone will continue to be an interesting market opportunity
Prices will come down for Low Power applications however this will increase application penetration and drive
unit volume growth
The ultra high purity segment will exhibit more price discipline as a result of competitive landscape
The future will belong to the lowest cost – highest purity 150-200mm rod producer
Strongest market drivers will be: Electric/Hybrid Electric vehicles, High Voltage DC transmission, Electronic
and Variable motor control, Alternative Energy conversion and transmission
REC
Silicon
REC
GROUPSilane
Field Trip
Moses Lake
March 16
55 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silane Layer
TFT-LCD is the largest and fastest
consumer of Silane
2000-2014 CAGR area growth
of 33%
LCD Monitor Production Expected to
reach all-time high in Q1 2010
Gen 6 and larger fabs expected to
average 87%+ fab utilization rate in
2010
Silane application – TFT-LCD
Field Trip
Moses Lake
March 16
56 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
0
1,000
2,000
3,000
4,000
5,000
6,000
2008 2009 2010 2011 2012 2013
MT
UPSIDE DEMAND OTHER SEMICONDUCTOR DISPLAY PV
Silane market demand
Sources: SEMI, DisplaySearch & REC internal model.
Field Trip
Moses Lake
March 16
57 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
- 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000
CA
SH
CO
ST
($/k
g)
SILANE STACKED SUPPLY (2010, MT)
Market leaders are best positioned - Silane
Field Trip
Moses Lake
March 16
58 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Total available market will continue to grow for the next 3-4 years
Pricing will most likely come under pressure as existing producers defend market share
against newcomers
The lowest cost high quality producer with sufficient scale and reliability of operations will
prevail
Thin Film silicon based PV will most likely not be of significance in the next 3-4 years and
may not be a reliable market driver
Continued growth in TFT and Semiconductor is a likely scenario for the next 3-4 years
Value chain and business models will be challenged and changed over the next 2-3 years
Market summary - Silane
Field Trip
Moses Lake
March 16
59 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
The American Bison provided Plains Indians with an ideal platform to survive and expand: food,
shelter, weapons and barter goods. They maximized the asset.
Maximization of the platform
REC
Silicon
REC
GROUPTechnology update
Ron Reis
Field Trip
Moses Lake
March 16
61 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Contents
Silane
Polysilicon
Granular polysilicon quality
Float Zone
The future
REC
Silicon
REC
GROUPSilane
Field Trip
Moses Lake
March 16
63 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
It all starts with the silane molecule
Signature Silane TM Enables all silicon deposition
applications
Purest silicon precursor
More than 25 years of experience with
silane technology
Technology is focusing on exploiting
this molecule and the manufacturing
technology for next generation products
and processes
Field Trip
Moses Lake
March 16
64 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
The Silane process
1) Hydrogenation (3 SiCl4 + 1 Si + 2 H2 = 4 SiCl3H)
2) Distillation (4SiCl3H = 3 SiCl4 + 1 SiH4)
Field Trip
Moses Lake
March 16
65 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
REC Silicon Silane experience
0
4000
8000
12000
16000
20000
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Silane MT/Yr
Silicon 1.0 –
Phase I
Silicon 1.0 -
Phase IISilicon 1.0 -
Debottleneck
Silicon 2.0
Silicon 3.0/4.0
Silicon 2.0 -
Debottleneck
Silicon 1.0 -
Debottleneck
Field Trip
Moses Lake
March 16
66 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silane leadership
UNIQUE TECHNOLOGY
– Enables all silicon deposition applications
– Flexibility supports different technologies
CONTINUOUS COST IMPROVEMENTS
– Economies of scale: plant size
– 4x increase from Silicon 1.0 to Silicon 4.0
MORE THAN 25 YEARS EXPERIENCE
– 25 years of uninterrupted experience in making and moving silane
SUPPLY RELIABILITY
– Four separate production plants, four loading buildings + over 350 transport modules
CONTINUOUS R&D FOCUS
– Two research sites with focused teams developing next generation manufacturing
which means lower capital and operating costs
REC
Silicon
REC
GROUPPolysilicon
Field Trip
Moses Lake
March 16
68 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Two polysilicon technologies
Siemens Reactor
FBR Reactor
Silane
Cooling medium
Cooling medium
Reactor outletReactor inlet
Electrical contact
Polysilicon
rods
Field Trip
Moses Lake
March 16
69 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Long experience with polysilicon >25 years
0
2000
4000
6000
8000
10000
12000
14000
Polysilicon MT/Yr
Silicon 1.0
Silicon 1.0
„97 Expansion
Silicon 2.0 -
Solar
FBR – Silicon 3.0
Added 07 Unit
Silicon 2.0 – Phase I
Silicon 2.0
Phase II
Field Trip
Moses Lake
March 16
70 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Siemens Reactors:
Silane based proven technology
Produces ultra-pure polysilicon
Meets a specific set of market needs
Higher energy consumption
Batch process
Needs additional product finishing to be usable
Siemens Reactor Schematic Cooling medium
Cooling
medium
Reactor outletReactor inlet
Electrical contact
Polysilicon
rods
Initial polysilicon technology: Siemens
Cooling medium
Field Trip
Moses Lake
March 16
71 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
FBR = Energy efficiency
GOAL:
Support PV cost roadmap
PROVEN:
Lowest energy consumption
0
20
40
60
80
100
120
Siemens Kwh/kg FBR Kwh/kg
Energy Consumed
Field Trip
Moses Lake
March 16
72 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
FBR Technology:
Proprietary REC technology
Energy efficient – 10% of Siemens energy usage
Continuous production
Lower cost
Granular polysilicon is easy to handle
FBR Reactor Schematic
Silane
Fluid bed technology (FBR) advantages
Field Trip
Moses Lake
March 16
73 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Fluid bed development history - timeline
1990s 2002 2003 2004 2005 2006 2007 2008 2009 2010 +
FBR Pilot Reactor
FBR Pilot 2 Reactor
SILICON 3.0 COMMERCIAL PROCESS
FBR Pilot 3 Reactor
FBR-B Next Generation Reactor
Pi
lo
tS
tu
di
es
GE
NE
RA
TI
ON
NE
XT
FBR-A Demonstration reactor
Field Trip
Moses Lake
March 16
74 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Process development story
Field Trip
Moses Lake
March 16
75 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
FBR scale up: from demonstration to commercial reactor
Pilot Plant:
~150 MT/yr
Five years of demonstration reactor experience
Process optimization & control modeling
Customer qualification
Increased FBR reactor size and additional
number of reactors
16
me
ter
56
me
ter
FBR Plant:
10,500 MT/yr
REC
Silicon
REC
GROUPGranular polysilicon quality
Field Trip
Moses Lake
March 16
77 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Quality model
Field Trip
Moses Lake
March 16
78 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Quality improvement trend
10/24/09 11/03/09 11/13/09 11/23/09 12/03/09 12/13/09 12/23/09 01/02/10
Total Metals [ppbw]
Typical constituents: Fe, Cr and Ni Longer run lengths Process stabilization Steep process
operator learning curve Targeted PV Quality
Field Trip
Moses Lake
March 16
79 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Quality results
Solar customer experience:
Silane purity means donors/acceptors are not of concern - verified
Silane/FBR process means carbon/oxygen are of no concern - verified
Blend tests: ratios from 50% - 100% FBR granules
Achieving normal cell efficiencies
Form factor influence – optimizing blend ratio for maximum melt parameters and
productivity
REC
Silicon
REC
GROUPFloat Zone
Field Trip
Moses Lake
March 16
81 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Float Zone characteristics
SILANE BASED FLOAT ZONE
ULTRA PURE form of silicon
EXCELLENT RESISTIVITY:
Radial and Axial
LOWER TEMPERATURE DECOMPOSITION:
– Smaller grains = Greater toughness
= Better FZ performance
QUALITY CONTROL: Customer benefits
in first pass yields
Field Trip
Moses Lake
March 16
82 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
The Float Zone production process
Float Zone (FZ) is a manufacturing method for fabricating
very pure silicon
Extremely low concentration of impurities
(e.g. carbon, nitrogen & oxygen)
FZ takes advantage of the concentration change by
segregating impurities during the liquid-to-solid transition
Impurities in the molten region tend to stay in the
molten region, allowing for a very pure single
crystal region to remain
Melt never comes into contact w/ anything but vacuum
(or inert gases)
Good resistivity control by introducing gaseous
dopants in the growth chamber
Photo courtesy of University of Delaware &
The Prometheus Institute
REC
Silicon
REC
GROUPThe future
Field Trip
Moses Lake
March 16
84 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Silane – precursors and derivatives
PRECURSORS AND DERIVATIVES: SiH4 chemistry enables specialty molecules
Mono and Di-Chlorosilane
– Specialty deposition molecule. In production
DiSilane
– Low temperature silicon deposition. In production
Trisilane
– Lower temp silicon deposition. Target 4Q 2010 production
PolySilane
– Liquids for silicon coating and printing. Research quantities produced.
Assessing semi-works for 2011
Field Trip
Moses Lake
March 16
85 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Disilane pilot
Field Trip
Moses Lake
March 16
86 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Next generation – FBR B
GOAL: Reduce manufacturing cost / targeted purity for high efficiency PV cells
APPROACH:
– Leveraging the company‟s R&D efforts and operational experience: knowledge from FBR-A
– Improve the primary cost drivers for first generation FBR technology: Capacity and CAPEX
– Continue to capitalize on silane‟s value
STATUS:
– Facility completed in 2009 and trials are underway
– Continuing improvement towards grid parity
Field Trip
Moses Lake
March 16
87 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Intellectual assets
PATENT PORTFOLIO: 24 Patent Families / 73 individual filings
INNOVATION/TECHNOLOGY PIPELINE: Idea/Invention Disclosure
rate „09 vs. „08: +10%
REC
Silicon
REC
GROUPFinance update
Jan Johannessen
Field Trip
Moses Lake
March 16
89 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
RECORD ANNUAL REVENUES AND EBITDA
RECORD POLYSILICON PRODUCTION VOLUME +26%
POLYSILICON REVENUE GROWTH +9%
SILANE REVENUE GROWTH +40%
POLYSILICON ASP - 8%
SILANE ASP +14%
SOLID PERFORMANCES BY SILICON 1.0 AND 2.0
SILICON 3.0 VOLUMES RAMPING RAPIDLY
2009 Highlights
Field Trip
Moses Lake
March 16
90 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Strong, profitable growth
$0
$100
$200
$300
$400
$500
$600
$700
2003 2004 2005 2006 2007 2008 2009
$0
$50
$100
$150
$200
$250
$300
$350
2003 2004 2005 2006 2007 2008 2009
REVENUE ($ Million) EBITDA ($ Million)
Field Trip
Moses Lake
March 16
91 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Continuous growth in 2009
$0
$50
$100
$150
$200
Q1 Q2 Q3 Q4
$0
$25
$50
$75
$100
Q1 Q2 Q3 Q4
REVENUE ($ Millon) EBITDA ($ Million)
Field Trip
Moses Lake
March 16
92 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Revenue segmentation - 2009
AMERICA7%
EUROPE49%
ASIA44%
SOLAR GRADE
49%
FZ-EG19%
SILANE27%
OFF SPEC
5%
BY GEOGRAPHY BY PRODUCT
Field Trip
Moses Lake
March 16
93 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Energy consumption – FBR vs. Siemens
11
1
Relative Energy Cost Per Kg – Solar Grade
SIEMENSREC Silicon 1.0
FBRREC Silicon 3.0
Field Trip
Moses Lake
March 16
94 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Strengthening cost position with FBR
1.00
0 %
20 %
40 %
60 %
80 %
100 %
120 %
2008 2009 2010E 2011E 2012E
Re
lative
So
lar
Gra
de
Po
ly C
ost P
er
Kg
FBRREC Silicon 3.0
SIEMENSREC Silicon 1.0
DRIVING DOWN POLYSILICON COST
Field Trip
Moses Lake
March 16
95 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Capital expenditures
$0
$100
$200
$300
$400
$500
$600
$700
$800
$900
2007 2008 2009 2010
OTHER
Si 3.0
Si 4.0
US
D M
ILL
ION
SEXPANSIONS MOSTLY COMPLETED
Field Trip
Moses Lake
March 16
96 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
REC Silicon 2010 Outlook
Polysilicon production of 12,000 MT
– Expect lower selling prices as a result of product
mix and pricing pressures in the market
Silane sales volume of 2,400 MT
– H1 volumes negatively affected by seasonality and
customer inventory adjustment
Ramp of Silicon 3.0 production volumes
Silicon 4.0 to start commercial production mid
2010 and ramp-up H2
Overall revenue and EBITDA growth
Field Trip
Moses Lake
March 16
97 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
On October 16th 2009 REC Silicon filed an application for the Advanced Energy Manufacturing Tax
Credit, which is part of the President Obama‟s economic stimulus package.
The foundation for the application, in addition to job creation, was significant energy savings made
possible by REC Silicon‟s proprietary FBR technology, which will significantly contribute to lowering
solar energy costs.
IRS notified the company in January that it was awarded a $154,896,429 credit under section 48C of
the Internal Revenue Code, the largest tax credit awarded under the program.
The credit will be used to offset future federal income taxes.
A Grant Receivable Asset of $154.9 million will be recorded on the balance sheet in Q1 2010.
Tax credit award
Field Trip
Moses Lake
March 16
98 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Well positioned for continued growth
SOLAR GRADEFLOAT ZONE
ELEC GRADESILANE
MARKET & PRODUCT LEADERSHIP
LEADING COST POSITION
DIVERSIFIED GROWTH MARKETS
PROPRIETARY TECHNOLOGY
BRAND - CUSTOMERS -
DISTRIBUTION
REC
Silicon
REC
GROUPSummary remarks
Ole Enger
Field Trip
Moses Lake
March 16
100 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Summary; REC Silicon - a solid platform for the future
The FBR technology is proven,
establishing REC Silicon with a
leading cost position in the industry
Delivered by a very experienced
and capable organization
– Further strengthening of the
organization continues
Creating a solid platform for the
future of the REC Group
Field Trip
Moses Lake
March 16
101 Copyright Renewable Energy Corporation ASA. All Rights Reserved March 16, 2010
Large share of assets in ramp-up or
under construction not contributing
positively to EBITDA
Ramp up of the Singapore facility – a
significant step forward for REC Solar
Re-establishing the position of
REC Wafer in Norway
Market growth expected to return in
2010 – but overcapacity continues
Downward price pressure, but easing
compared to 2009
EBITDA in Q1 2010 significantly
below Q1 2009
Reminder; 2010 will be another „ramp-up‟ year for REC
Book value of PP&E
NOK million
2009 EBITDA contribution of NOK ~2,150 million from
producing assets. Negative 2009 EBITDA contribution of
NOK ~400 million from assets in ramp-up and under
construction
0
5,000
10,000
15,000
20,000
25,000
30,000
2009 2010 2011
Producing assets In ramp-up Under construction
REC
Silicon
REC
GROUPThank you
top related