• Friday, November 20, 2009 Latest Update: 4:41PM
Eric Wesoff | August 27, 2008 at 8:00 AM 6 Comments

AVA Solar Continues Quest to be Next First Solar, Huge Round Soon to Close

In their quest to create the next First Solar, VC investors are making enormous bets on new solar technologies, including the difficult Cadmium Telluride (CdTe) materials system.

I’ve just learned from a very reliable investor source that AVA Solar, a CdTe photovoltaics manufacturer in Colorado, has received a term sheet for a $100 million round at a $750 million pre-money valuation, with $50 million of that round coming from DCM. A contact at AVA Solar declined to comment. Valuations in these stratospheric ranges are becoming the norm for solar startups with very high expectations and very low revenues such as Solyndra, Nanosolar and MiasolĂ©.

My source’s investment firm chose not to invest in AVA as the valuation was too rich for their blood. Another VC told Greentech Media’s Mike Kanellos that AVA Solar was a tough call, calling it somewhat of a copycat of First Solar and asserting that AVA’s success depends on execution while First Solar has shown time and time again that it is great at executing and manufacturing. First Solar looks to shortly enter the realm of Gigawatt capacity solar suppliers, joining a group of four or five vendors expecting to reach that volume by 2010.

AVA is targeting a very low cost per watt based on a continuous manufacturing process with technology developed at Colorado State University’s Material Engineering Laboratory. According to a source close to the company, AVA can show costs below First Solar and the ability to maintain that advantage with a very low risk ramp to the 200 MW level that they are targeting for 2010 (First Solar boasts costs nearing $1/W). According to this contact, “The ramp from 5MW to 200MW is the simplest and most obvious process you can imagine, a touch of genius.”

Pascal Noronha, AVA’s CEO, is an investor and entrepreneur with ties to Warburg Pincus and the Reliance Group in India. AVA closed its second round of financing in 2007, led by The Invus Group, a New York-based investment firm.

There is a toxicity risk to Cadmium Telluride that First Solar has confronted with a 100 percent take back program bonded by Swiss Re in the event that First Solar is not around in 20 to 30 years. There is also an availability risk in the Tellurium market so firms may need to buy old lead or gold mines and set up recovery systems. There are some reliable and not-so-reliable voices on the Web that speculate that First Solar and other CdTe PV firms will see price increases and material shortages in their raw material feedstocks.

Armed with their new funds, all AVA Solar has to do is flawlessly execute and ramp to 200-MW volume.

In addition to AVA and First Solar there are a few other firms working with CdTe.

Here’s a list:

Antec: A German CdTe PV firm that has had its share of financial fits and starts over the last few years.

Bloo Solar: According to Kanellos’ interviews, this early stage firm wants to use CdTe-coated nanorods to harvest sunlight, although Bloo can use other chemistries.

Calyxo: A subsidiary of Q-Cells founded in 2005 (acquired CdTe PV maker Solar Fields for $5M, forming Calyxo USA). This year, Calyxo is expanding its pilot plant to a capacity of 25MW and looking to construct a 60MW line.

PrimeStar Solar: With GE as their majority shareholder and NREL roots, PrimeStar is setting up parallel CdTe fabs in Colorado and New York.

Solexant: A next-generation CdTe manufacturer using nanoparticles. Funded by X/Seed Capital, Firelake Capital, Medley Partners, and Trident Capital.

Sunovia: Single-crystalline, CdTe on Si tandem solar cells.

ZiaWatt Solar: Very early stage CdTe supplier working on improved back contacts.

Comments [6]

  • Dr. Duru 08/27/08 2:34 PM

    Who is supplying the CdTe to these various companies? I only know of 5N Plus in Canada who just signed an amended agreement iwth First Solar.

    Reply
  • Norrin Radd 08/27/08 4:12 PM

    Dr. Duru,
    You are right:  5N Plus is the primary supplier.
    This from FSLR’s S-1
    The most critical raw material in our production process is CdTe.
    Currently, we purchase all of our CdTe in manufactured form from two
    manufacturers. We have a three year written contract with one of our CdTe
    suppliers, that provides for quarterly price adjustments based on the cost of
    the tellurium component of CdTe. We purchase CdTe from our other supplier under
    quarterly purchase orders. We acquire the remainder of our raw materials under
    quarterly purchase orders, at prices based on annual volumes.

    Reply
  • ChuckJ 09/25/08 9:58 AM

    How does the EU’s RoHS directive impact these thin film companies? I had assumed that the RoHS would have a huge number of items / substances listed; however, I was surprised to see that there were only a handful of potentially banned substances and Cadmium was one of them. 

    Additionally, how much Te is needed? Doing a quick wikipedia search, Te is listed as the 9th least abundant metallic elements - surely this will eventually enter the picture, possibly sooner rather than later.

    Reply
  • Mike Smith 09/19/08 6:20 AM

    Has anyone looked into a company called Redlen Crystal in Vancouver, Canada? And if they have similar promise ?

    Reply
  • greg c 09/19/08 10:57 AM

    Redlen provides CdTe and is just rampling up on increased production of CdTe. They are doing a fraction of VNP production but should be able to play in the same place as VNP. However, their primary focus is on CdZnTe which is used for nuclear imaging. CdTe is somewhat of a intermediary product along the path to their ultimate destination.

    Reply
  • IAN DYKES 03/4/09 9:36 AM

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    P.S I also attach my resume/skill set – although it highlights mostly engineering skills

    E-Mail: (JavaScript must be enabled to view this email address)

    Ian B. Dykes , B.E.E.ENG
    253 Patricia Rd.
    Stratford, Ont. N5A 7B3
    519 - 274 - 0502
    E-Mail (JavaScript must be enabled to view this email address)

    OBJECTIVE: Control System Design/Professional Product Development

    PROFILE

    15 years Exceptionally strong small business management skills
    5 Yrs. Team leader - electronic design
    7 yrs CAD drawing experience
    3 years PLC control system design/Implementation
    Design and fabricate 4 layer PCB
    Excellent troubleshooting Skills - both electrical and mechanical
    Design and wrote accounting system
    Well versed in all popular business development and office software
    Designed and Demonstrated World’s first Multi-Processor floating point system for Microcomputer
    Design Multi-Purpose Consumer Duarable – Daily Bailey - Patent filed May 2008
    Featured on the Cover of the 1988 Issue of Trade & Commerce
    diligent, honest and pay specific attention to details
    WHMIS certified

    WORK HISTORY:

    2000 - 2009 Consulting/Product Design Self Employed
    1993 – 2000 Business Director /System Dev Pinnacle Real Estate Systems, Stratford Ont.
    1987 – 1993 Team Leader   Everest Research, New Westminster B.C.
    1985 – 1987 Design Eng.  MiCray Electronics, Calgary Alt.
    1983 – 1985 Technician   Amoco Oil, Calgary Alt.

    EDUCATION:

    Bachelor of Electrical & Electronic Engineering, Carleton U., 1983

    INTERESTS

    Love animals, cooking, acoustic guitar , ENVIRONMENTAL/SUSTAINABLE product development

    Reply

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