Greentech Media

Costs will need to come way down to help lower solar prices overall and boost demand, he said, adding that he’d like to see silicon prices fall to $60 to $80 per kilogram -- and eventually even to $30 per kilogram. If silicon costs drop, demand for solar power will increase and an oversupply shouldn’t be an issue for another 10 years or more, he said.

While panel prices are around $4 per watt today, he said if silicon prices become more reasonable, the industry should be able to sell panels for $2 to $2.50 per watt while keeping "very healthy profits for the food chain."

Calling Out the Competition

Peng said LDK, which already is the largest solar-wafer manufacturer in Asia and the second-largest manufacturer in the world, plans to overtake Renewable Energy Corp. for the top spot in 2009.

While it’s taken REC some eight or nine years to build up to 400 megawatts of capacity, LDK is only two years old and is growing faster, he said.

"We are the cost leader on the nonsilicon manufacturing cost," he said. "Our manufacturing cost is now about 30 percent lower than most other peers, both in China and overseas."

LDK already has signed contracts for most of the equipment it needs to reach 1.6 gigawatts of wafer capacity next year. It also bought a 33.5 percent stake in a Chinese crucible company to guarantee a lower-cost supply of crucibles, which it usually imports from France and the United States, Peng said.

"Most of the equipment is long-lead item and it’s even not available in the short term. We have ordered most of our equipment. … And all the delivery is on schedule and it will continue on schedule."

Peng added that the company continues to improve its technology processes to "easily" reduce its cost from less than 30 cents per watt -- compared to competitors’ cost of 30 to 40 cents --to less than 20 cents per watt in the "near future."

One way it plans to reduce cost per watt is by increasing the amount of sunlight the panels made from LDK’s wafers can convert into electricity. LDK’s customers have reached average cell efficiencies of 15.8 percent -- with some reaching averages of 16 percent -- up from an average of 8.3 percent only half a year ago, he said, adding the company’s goal is to reach averages of 18 to 19 percent.

"We will continue growing faster, compared to the local manufacturers, and I think our capacity is much much bigger and we are growing much faster and our production -- especially our manufacturing cost -- is much lower," he said. "Cost reduction is the big end goal for LDK Solar."