Sencera International Corp. -- one of the latest companies to claim it can make thin-filmsolarmodules at a cost of less than $1 per watt -- got there by way of a happy accident.

The Charlotte, N.C.-based startup, founded in 2003, initially provided thin-film transistor, integrated-circuit and liquid crystal display (LCD) panels to the U.S. Army and U.S. Display Consortium.

In early 2006 – “Just by chance,” said Britt Weaver, Sencera's chief operating officer -- one of those customers sent a Sencera silicon cell to the National Renewable Energy Laboratory in Golden, Colo., for testing. The company learned that the chemical process behind its products laid down silicon in qualities, and at speeds, that could work for the thin-film solar market.

"It turned out the film we deposited was highly microcrystalline, and it just so happened that we deposited the film at a very high rate," Weaver said. "It was a very easy decision to say, let's take the resources of the company and apply it to the solar challenge."

Since then, the company raised $3.6 million from the Quercus Trust, a Newport Beach, Calif., venture-capital firm, in April to build a 1-megawatt-per-year thin-film test production line.

The company last week announced it will invest $36.8 million to build a 38-megawatt solar-panel factory in North Carolina by 2011, after winning a $62,000 grant from the state and the promise of another $100,000 grant from North Carolina's Green Business Fund. Last month, Sencera said it had hoped to raise $35 million to build a 35-megawatt plant. It planned to build the plant in 7-megawatt incremens, with the first line to begin production by the summer of 2009. 

“We're not reinventing the technology, we're applying hardware that can do the technology faster,” Weaver said.

Sencera plans to produce tandem-junction solar cells -- that is, cells made of two layers stacked on top of each other -- of amorphous silicon and microcrystalline silicon.

That's a key cost goal for thin-film solar cell makers, as it would put the emerging technology within reach of competing with conventional electricity generation. And those prices continue to rise with the cost of fossil fuels and environmental regulation.

But Sencera isn't the only company claiming such groundbreaking low costs. Whether it can deliver will depend on the strength of its technology, the execution of its move from testing to full-bore production and the investment community’s confidence in the company's competitiveness, said Travis Bradford, president of the Prometheus Institute, a Greentech Media partner.

“It's one thing to say you can do it and another thing to do it,” Bradford said. And even if the company can meet its technical promises, “having a production-scale technology is different than having a fully integrated solar-panel production and sales and marketing structure.”

Sencera's low-cost claims are rooted in the work of Russell Jewett, a nuclear engineer and former Sandia National Laboratories scientist who founded the company and now serves as its chief executive officer. Jewett's research in plasma chemical-vapor-deposition systems led to Sencera's initial line of products.

The company claims its process delivers speeds of up to 50 angstroms, or 5 nanometers, per second -- speeds currently unmatched in commercial production of thin-film solar cells.

That speed is what Sencera claims will enable it to produce cells at less than $1 per watt.

Thin-film competitors NanoSolar, Miasolé and Global Solar also claim they will eventually be able to reach costs that low once they increase production. And First Solar (NSDQ: FSLR), the No. 1 thin-film maker today, reported it had already reached costs of $1.12 per watt in the fourth quarter.

Weaver added that Sencera will be able to produce finished tandem-junction panels that can convert 12.7 percent of the sunlight that hit them into electricity. That conversion efficiency is greater than any thin films now on the market. HelioVolt in May announced it had made a thin-film cell with 12.2 percent efficiency (see HelioVolt Hits 12.2% Efficiency).

Bradford noted that thin-film modules at 12.7 percent efficiency would be “pretty impressive” for an initial thin-film result. Sencera’s low production-cost claims, if they pan out, would place the company among the top players in the industry.

Sencera is also looking at applications to benefit from the fact that its plasma deposition process can work at lower temperatures than other current processes, such as building-integrated photovoltaic roof shingles, Weaver said.

The company also said it has successfully completed contract work for developers of copper-indium-gallium-selenide, or CIGS, solar cells, but Weaver declined to identify those companies beyond calling them ’recognizable’ competitors in the industry.

And Sencera last month ended a technology-development agreement it had signed with XsunX last year, paying back a $1.5 million loan from the Aliso Viejo, Calif., company that is seeking to produce amorphous-silicon films.

Weaver said both companies agreed to the termination. Sencera is now concentrating, not on contract work or on selling manufacturing lines to other companies, but on becoming a player in the solar-panel business itself, he said.

“The message we’re putting out there is: We’re a module company,” he said. “That’s what we accepted investment for.”

In the meantime, Bradford noted, Sencera is under tight time pressure to make good on its promises, if it wants to compete against both established thin-film companies – notably cadmium-telluride producer First Solar -- and against newcomers seeking to be the first to deliver amorphous-silicon with low costs and high efficiencies.

"The longer it tries to prove its technology, the more likely other companies will have already proven theirs," he said.

Mitsubishi Heavy Industries, for example, began producing its amorphous- and microcrystalline-silicon films in mid-2007. The company can pump them out at speeds of 2.3 nanometers per second, close to half Sencera’s throughput claims, with conversion efficiencies of 9.5 percent.

Sencera also faces semiconductor giants like Applied Materials, which is signing deals to sell SunFab amorphous-silicon thin-film production lines on the order of 278 megawatts of capacity in 2008 and 1.9 gigawatts of capacity in 2010, according to a Prometheus Institute tally.

IBM and, more recently, a subsidiary of Royal Dutch Shell, also have announced they are moving into thin-film technologies (see Companies Crowd Into CIGS Space and Shell’s Showa Solar Plans 1-Gigawatt Plant).

David Kirkpatrick, managing director and co-founder of venture-capital firm SJF Ventures, hosted an investor forum in New York last month at which Sencera CEO Jewett presented his company’s plans.

“It was a full house,” Kirkpatrick said, with participants in the forum expressing particular interest in Sencera’s ability to deposit silicon on a wide variety of materials, not just glass.

Still, Kirkpatrick said SJF Ventures, as a “downstream investor,” wasn’t looking to put money into Sencera, which he described as a “pre-revenue, tech-breakthrough” company.

“There are folks who’ve been more heavily funded and have been at it longer,” he said. “But it’s not always the first mover who is the winner.”