I’ve been saying for a while, that with enough money, someone is bound to crack the CIGS nut in thin film, and deliver the cleantech sector another First Solar (NASDAQ:FSLR) like renaissance for the always around the corner technology.
That’s not because it’s easy, or even because it’s a good idea to try, but when well over a billion dollars in investment pours into a given technology, something is bound to come out the other side – eventually. A seductively high efficiency potential technology with very low potential materials costs, CIGS has been just over the horizon for a decade or more, but has enjoyed a huge influx of capital and increase in the number of programs chasing in over the last 5 years. Similar to other solar thin film technologies, device complexity, effective yield, throughput, and process control issues are always the bugaboo.
Given its seductivenes, its somewhat capricious nature, and the siren filled history of the technology, perhaps we should think of CIGS like a woman, and all men need a few dating rules of the road to keep in mind before we jump in. Here are mine (for CIGS, not women):
Number one, like most thin film technologies, $100 mm in investment is the ante up to play the game. Just because you spend it doesn’t mean you get real product out, and with CIGS, you tend not to know whether anything is workable until oh, say $50 to $100 mm is already spent.
Number two, what you think you know, you don’t. Until the pilot plant has been operating for a few years, companies generally really underestimate what they don’t know.
Number three, remember those experiments and great idea you sold your investors on, the hard part is not there, the hard (read risky) part is ALL in the “it’s just engineering” end of the scale up process you told the investors was “fairly straightforward”. This isn’t IT, it’s deposition with a very commoditized end product.
Number four, whatever the projection as far as timing, add 3 years, maybe 5. I’m not kidding here, I said years.
Number five, when the words “fast”, “roll to roll”, “reel to reel” or anything else equating to speed in the process are in the pitch deck, translate that to read excruciatingly slow in the development timeline, and lots of “issues” popping up in those nasty yield and process control areas.
Number six, when investing, be very careful about that “yield” number and the “capacity” numbers they made up based on it. All thin film development companies keep “little black books” with the data and charts on every process run they’ve ever made. Read every single one of those charts, and ask lots of stupid questions about why only 4% of the total square footage produced is above 6% efficiency in run XYZ. Think in terms of “effective total average yield”. That’s where the problems are hiding.
CIGS watchers have a number of darlings to follow. There’s Miasole, which now under new management is rumored to have substantially tightened down its development discipline to take it’s shot, Nanosolar, another Silicon Valley venture darling that has been described by many observers along the lines of, “never met hype they didn’t like”, but with a seductively low cost printable process if they can get it to work, Solyndra, the “stealth” company with the big sign on I-880, Heliovolt, the Texas-based hot CIGS deal of last year, which burst on to the fundraising scene on the back of it’s still extremely early stage “FASST” technology. And those are just the largest of the US based venture backed deals, without including Honda, IBM, DayStar, Ascent Solar, Solopower, and literally dozens upon dozens of others around the world with significant backing (though all at a very, very early stage). Wikipedia has a decent cut at a list, though by no stretch of the imagination comprehensive.
My best estimate is that most of the venture investors in each of those deals personally looked in depth at the manufacturing process of single digit numbers of competing approaches before investing. And only read the little black book on two of them. That strategy was tried, with ahem, “mixed” results, in fuel cells a few years back. We’ll see how well it works in thin film solar.
And of course, as with most things in solar, the major players should probably be watched more carefully than the startups. I’ve always liked larger companies to crack thin film issues, in no small part because the term “stage gate” tends to mean something to them.
But my personal favorite for front runner currently is Arizona based Global Solar, a solar company I have been following for years. Their announcement a few months ago of 10% efficiency in production runs, was pretty much lost in the crush of press around solar, for reasons unfathomable to me.
While admittedly not yet proven in a full production environment (they are working on the scale up to 30 MW plants) they do have the massive advantage of having run virtually the only operating CIGS pilot plant in the world – and I believe has shipped more volume of CIGS product than anyone if not everyone else. True to form, that technology, which originally came out of the Tuscon Electric backed ITN Energy Systems labs in Colorado which later did Ascent Solar, has had an estimated $150-$200 mm plus invested in it over the last decade, before Solon AG bought the company for a reported $16 mm. Though to be fair, current management under CEO Mike Gering was brought on well into that process. So while I’ll keep my fingers crossed that some one will crack the CIGS nut, and continue to be flabbergasted at the $1 Bil plus valuations estimated to have been acheived by some of the startups named here for very large science projects, when it comes to the one to watch, Global Solar is my personal pick.
Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is the founding CEO of Carbonflow, founding contributor of Cleantech Blog, a Contributing Editor to Alt Energy Stocks, Chairman of Cleantech.org, and a blogger for CNET’s Greentech blog.