[pagebreak:Q&A: Miasolé CEO on Catching Up With First Solar]

Nearly every time Miasolé CEO Joseph Laia runs into an analyst, the first question is the same: When will First Solar get some competition?

That's because Wall Street darling First Solar (NSDQ: FSLR), by far the largest thin-film solar manufacturer, boasts better margins than the rest of the solar industry (see First Solar Rides High, Wall Street's Love Affair with First Solar Continues and Thin Film to Survive Solar Shakeout).

As a result, First Solar shares are soaring above $270 per share. And analysts say the company's picture could get even rosier as market trends are expected to press prices down, further favoring lower-cost technology such as First Solar's thin films (see Thin Film to Survive Solar Shakeout).

Laia certainly hopes to give First Solar some competition.

Santa Clara, Calif.-based Miasolé makes copper-indium-gallium-diselenide films, also known as CIGS, which have proven to be the most efficient of all the thin-film technologies at converting sunlight into electricity - at least in the labs.

So far, Miasolé has been able to produce panels with 9- to 10-percent efficiency, meaning the panels are able to convert 9 to 10 percent of the sunlight that hits them into electricity.

First Solar, which makes cadmium-telluride films, reached an average cell efficiency of 10.6 percent at the end of the fourth quarter, according to investment bank Piper Jaffray.

Moreover, First Solar makes thin film at a lower cost than the reigning solar-power technology, crystalline-silicon panels.

Last month, Greentech Media sat down with the usually tight-lipped CEO, who shared his take on why competition hasn't caught up with First Solar, his thoughts on the increasing complaints about high solar valuations and Miasolé's plans to pursue building-integrated solar despite declining a $20 million government grant for the technology.

Q: Why are thin-film companies taking so long to catch up with First Solar?

A: There are two parts to that answer. First, anybody can go home and, in an Easy-Bake Oven, make 5- or 6-percent CIGS cells. But making it 10, 11, 12 percent, that's hard. It's hard to have high efficiency and your costs under control. I don't think anybody has figured it out because you can't buy a good CIGS module at a low price from anybody in the world. ... Why hasn't anybody [else aside from First Solar] figured out cadmium-telluride yet? The answer is it's hard. If it were easy than there would be gobs of guys out there.

Q: What's the other reason?

A: [First Solar] has been at it for more than 15 years. In my experience, if you want a brand-new machine to make a brand-new film -- just one film, not the sandwich (of films that are put together to make a cell) -- it typically takes four to five years to figure it out and it takes about $25 million a year. We have developed the hardware, the process, the packaging, the whole thing. For Miasolé it's been fourish years. So its not like it's taking a long time.

[pagebreak:Miasolé Q&A: Continued]

Q: When does Miasolé expect to be able to give customers an alternative to First Solar panels?

A: We think we can scale pretty quickly. We’ll start in 2009, bring the factory on and start shipping. Probably by 2010, people will say, ’The Miasolé guys can do it,’ or they will say, ’The Miasolé guys can’t do it.’

Q: As more money gets funneled into solar, industry watchers have complained that solar company valuations are too high. Is there any merit to the grumblings?

 A: This is a really interesting question because [many are] pre-revenue companies. There are going to be winners and losers. Now the question becomes, what’s a pre-revenue company really worth when you know someone in there is likely to be another First Solar and have a market cap of $18 billion? [Editor’s note: First Solar’s market cap reached $22.51 billion Tuesday.] I think people are looking at what the opportunity is and, based on that opportunity, putting values on these companies. Is it too high? Maybe not. Is there risk involved? Absolutely.

Q: In April, Greentech Media reported that Miasolé declined $20 million in government funding for developing flexible building-integrated photovoltaic technology. Was it hard to give up all that money?

 A: No. [To protect CIGS cells from the elements,] you need a top coat so it doesn’t let the water in. [The top coat] doesn’t exist. It won’t be commercially viable for two to three years. I guarantee if I’m working on products that can’t get to market in less than two years, I’m not going to be making a lot of progress on being a compelling manufacturer with products that look like First Solar’s.

Q: Does Miasolé have plans to develop flexible building-integrated photovoltaic technology?

A: Absolutely. It’s one of the inherent advantages of doing flexible substrates. [We’re not ready to focus on it now, but] within the next 18 months, we’ll have people dedicated to working with partners on what a building-integrated product looks like.


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