California-based PV manufacturer Solaria Corp. has raised $40 million to double its current production capacity to close to 500 megawatts by year’s end.
It’s Solaria's second significant public investment in as many years, as it expands production to meet its small but growing share of the residential and commercial solar markets in the U.S. and abroad. Solaria produces modules in California in South Korea.
While the private company doesn’t give out current production figures, Wednesday’s investment will allow Solaria to approach “close to 500 megawatts” by year’s end, CEO Suvi Sharma said in a Wednesday interview. “That’s manufacturing capacity — that’s not necessarily what we’re producing today.”
The investment, led by Cypress Semiconductors founder and former SunPower chairman T.J. Rodgers alongside Chilean investor Isadoro Quiroga, is Solaria's second in 18 months aimed at expanding its manufacturing capacity. In January 2018, it raised $23 million from Structure Capital, aimed at tripling its production capacity to about 300 megawatts by the end of that year.
Solaria has raised more than $200 million since its 1999 founding as a maker of concentrating solar PV systems, which use lenses and optics to concentrate sunlight on photovoltaic cells for heightened efficiency. But Solaria shipped only about 30 megawatts of those panels before the technology, along with others premised on competing against expensive crystalline silicon PV, was swamped by the rise of increasingly cheap silicon PV.
Solaria pivoted to focus on producing a specialized line of “high-performance, high-aesthetic” silicon PV modules aimed at the higher-end residential and small commercial markets, Sharma said. “We take cells, we cut them into strips, we overlap one cell over the other, and create a monolithic, high power density, reliable and high performance solar panel,” he said.
Solaria started shipping that product three years ago, and “the business has scaled very rapidly for us,” Sharma said. He declined to provide any financial figures for the company, besides saying that it is profitable.
Relationship with Enphase
Solaria got out of the utility-scale solar business altogether through its 2013 spinout of its solar tracking business, NEXTracker, which went on to be bought by Flextronics (now Flex) for $330 million in 2015. Today, Solaria’s “projects are done 5 kilowatts, 10 kilowatts at a time, by local and regional installers,” Sharma said. While Solaria remains a small player relative to giants like China’s Jinko Solar or U.S.-based SunPower, it is gaining ground in its target markets, he said.
Wednesday’s investment will also bolster Solaria’s ongoing work with its AC module partner Enphase. In part, that’s driven by the connections between Solaria’s new investors, Rodgers and Quiroga, both of whom will join Solaria’s board of directors, and the Petaluma, Calif.-based microinverter maker.
Rodgers gained a seat on Enphase’s board of directors in 2017, after he joined Kleiner Perkins chairman John Doerr in a pivotal $10 million investment into Enphase at a time when it was struggling to survive against steep competition from SolarEdge and other inverter makers. As for Quiroga, in early 2018, Enphase raised $20 million in private equity from an entity affiliated with the Chilean investor, earning him or a designee a board observer position.
Sharma said that Rodgers and Quirora chose to invest in Solaria on the company’s own merits, not due to its partnership with Enphase. But Solaria and Enphase are working closely together, he said, both on AC modules today and eventually on integrating solar with batteries, electric vehicle chargers and home energy management systems.
Solaria was a key early partner for Enphase’s move into AC modules, PV panels pre-integrated with Enphase’s microinverters. The two launched their first AC module in April 2018, and “we have a nice installer base for that, and it’s growing,” Sharma said.
“But beyond that, Solaria is moving forward in providing a complete solution to our dealers, with solar, storage, car charging — and we’re leveraging a lot of the Enphase technology to do that,” he said. He’s referring to Enphase’s so-called Ensemble platform, a combination of batteries, inverters, related switchgear and controls, and a cloud-based software platform that can extend control to other key household loads.
Enphase plans to introduce Ensemble in the fourth quarter of 2019 and make it more broadly available in 2020. While Solaria and Enphase haven’t made any specific announcements regarding Ensemble, “the companies are working together to put everything together, to offer a complete solution,” Sharma said.