First Solar (NSDAQ: FSLR) is looking at building its second European factory in a French town near Bordeaux.
The cadmium-telluride solar panel maker and Paris-based EDF Energies Nouvelles are close to reach a deal with the town of Blanquefort to build a manufacturing plant there, First Solar said Monday.
The two companies will jointly pay for building the factory. EDF plans to provide half of the financing for building a factory with an annual capacity of more than 100 megawatts, the two companies said back in July, when they first announced the factory plan (see First Solar to Build 100MW Factory and sell to EDF).
First Solar and EDF previously had pegged the cost of the factory plan at €90 million. But the two companies said Monday the cost would be about €100 million ($150 million) instead.
The French factory would be the second in Europe for First Solar, which operates a manufacturing plant in Germany. Its other factories are in Perrysburg, Ohio and Malaysia.
The Tempe, Ariz.-based solar panels maker recently said it would invest $365 million to add eight manufacturing lines of 53 megawatts each in Malaysia next year (see First Solar's 2010 Forecast: 424MW of New Production Capacity, Near $3B in Sales).
EDF would be entitled to the entire output of the factory's products for the first 10 years, First Solar said.
Until recently, the EDF had invested mostly in wind farms in Europe and the United States. But the company said it wants to spend more on developing solar power plants.
Last week, it said it had lined up 500 million ($716.2 million) from the European Investment Bank to pay for building solar power plants in France and Italy between 2010 and 2012.
Both France and Italy have national incentives to encourage solar energy generation. The incentives are called feed-in tariffs, which are electricity rates that utilities must pay to any solar power plant owners.
Back in July, First Solar said the factory would be up and running in full production by the second half of 2011. The target has been moved to early 2012.
In a separate announcement on Monday, First Solar said it has completed a 21-megawatt solar power plant in Blythe, Calif., and the plant has been brought online.
The company, which jumped into the project development business in earnest earlier this year, already has sold the Blythe project to NRG Energy (see Pre-Thanksgiving Sale: First Solar Sells Project to NRG).
NRG is now selling the solar electricity to Southern California Edison until a 20-year agreement. The power plant is roughly 200 miles east of Los Angeles. NRG has hired First Solar to operate and maintain the power plant.
First Solar has been using its project development business to create sales for its solar panels in North America. In April, it spent about $400 million to buy unfinished projects from OptiSolar, a California company that had trouble raising enough money to continue its business.
One of First Solar's next power plant projects is to complete a 48-megawatt farm near Boulder City, Nev., for Sempra Generation. Sempra plans to sell the electricity from the plant to Pacific Gas and Electric Co.
First Solar plans to start building the solar farm, which will be called the Copper Mountain Solar Facility, next year and complete it before the year's end.