Or so it seemed. But as the commercialisation of Vivian Alberts' and the University of Johannesburg's (UJ) thin film solar technology gathers momentum, another picture is emerging.
SA stands to benefit significantly from this technology. Not just from the sizeable royalties and licence fees that will accrue to the company that owns the intellectual property. But also from the intensive and sustained technology transfer process that will lead to the development of a hi-tech solar panel manufacturing industry where previously none existed.
VIVIAN ALBERTS - Taking his technology offshore first will actually bring its benefits to SA faster
The company that holds the intellectual property rights to Alberts' thin solar technology (and is owned jointly by him and UJ), Photovoltaic Technology Intellectual Property (PTIP), has achieved the best of both worlds: it has structured a beneficial licensing deal for a technology that SA was underqualified to commercialise. In the process it has guaranteed that the technology will come home to the benefit of SA.The first licence holder, Johanna Solar Technology (JST), based in Germany and owned by a consortium of seven companies, has committed to transferring the technological know-how and project management expertise gained in the commercialisation process back to SA.
"First, our commitment is to get JST up and running," says Alberts, who will spend the better part of next year in Germany providing technical know-how and expertise to the 200-strong team that is building the hi-tech fabrication plant. "Then their commitment is to get SA up and running."
"If we started from scratch in SA, it would take 10 years to develop the competence to commercialise this technology - we have nothing here," he says. What he is doing, then, is short-circuiting this process.
This Germany/SA knowledge exchange was facilitated by the cross-shareholding in which a number of SA companies invest in the German licensee. In turn, JST will invest in the SA company.
The German companies involved are: project management experts IFE; solar module producer Aleo Solar; construction firm EPR; glass manufacturer Interpane; and 3EFinanz. The SA investors are: Anglo Coal; the Central Energy Fund; VenFin; and Richemont.
"Our German stakeholders - who could have been competitors - will bring valuable expertise to both JST and the SA operation," says Alberts.
In turn JST holds 24% of the SA company. Three or four SA investors hold the balance.
These investors are not confirmed, but the Central Energy Fund is a core part of the planning.
PTIP has standardised its relationships with key equipment suppliers. "We've signed a strategic collaboration contract with the European manufacturer of essential production equipment like the diffusion furnaces and sputter machines. They will be exclusively responsible for producing the equipment for the German and SA plants."
IFE will manage the building of the SA factory and JST scientists will spend time in SA, ensuring that skills and know-how are transferred to the local operation.
"We are trying to reduce the risk for local investors," says Alberts.
Obviously the project requires sizeable investments. The investment in the JST plant will top Euro 72m, but in SA that figure will be about R800m.
The one significant difference between the German and SA operations is that in Germany, government subsidies (for clean energy projects) cover 15%-20% of this investment. "There have been rumours of something like this in SA - which will give us a fair chance - but nothing formal has been announced," says Alberts.
That said, the business plan for the SA company is nearly complete. "We will have a bankable business plan by the end of the year," says Pieter van der Merwe, MD of PTIP and chief director of intellectual property at UJ.
In September, ground was broken at what will be the world's largest state-of-the-art production facility for solar modules, in Brandenburg an der Havel in Germany. In early 2007 the modern machinery for the production of the solar modules will be installed and the production process will begin. The plant will produce 1 000 solar modules a day, which is equivalent to 30 MW/year. It will expand to produce 500 000 60 W panels by 2009.
PTIP is also close to concluding a second licence arrangement with a European energy company listed on the Frankfurt stock exchange. The deal is similar in size and structure to that struck with JST. Its production plant, also initially capable of producing 30 MW of power a year, will be built next year and production is expected to begin at the end of the year.
Things are hotting up fast for PTIP and the reason is simple: the entire photovoltaic industry is in the middle of one of the biggest booms in its history. Thanks to a combination of high fossil fuel prices and large government incentives for renewable energy, solar installations grew 34% in 2005 and have grown by more than 20%/year for several years now. Yet even this rapid growth isn't enough to meet rocketing demand.
Growth in the solar industry is being limited by the global supply of silicon. Most of the photovoltaic market - more than 90% - uses silicon wafers as a starting material.
The reason Alberts' technology is attracting so much attention is that he has replaced the silicon layer with a combination of the elements copper, indium, gallium, sulphur and selenium (see insert on page 9). The result is a solar product that is cheaper and more efficient than typical photovoltaic panels.
"We are in a position where the market demand is there; the technology is ripe; the supporting facilities are falling into place; the timing is perfect," says Van der Merwe. "We will have three 30 MW plants up and running by 2010," he adds. "No similar production facility has achieved that capacity in such a short time."
To ensure these targets are met, he expects to have awarded the licence to the SA consortium by February or March next year, to get the product to market in 2008.
PTIP has identified a potential site at one of SA's port cities, has drafted designs for the plant and is in discussions with builders.
The SA company will hold an exclusive licence to manufacture and market thin film technology in Africa and its islands. It will also be able to market, but not manufacture, the technology offshore.
Of course JST and the other licensees will not be the only companies manufacturing thin film solar panels. In the past year or so, a number of manufacturers have started up in the US, among them Innovalight, Konarka, Miasolé and HelioVolt. Earlier this year, Royal Dutch Shell sold its crystalline silicon business to SolarWorld, choosing to focus on thin film technology instead. And last year, Honda Motor said it would enter the thin film business and mass-produce cells by 2007.
The investors are confident they have backed the right horse, however. "This thin film technology is regarded as one of the most promising developments in the solar industry," says JST MD Jeroen Haberland. "Compared with crystalline solar modules, our thin film modules offer significant advantages in terms of earnings, and they possess a high energy efficiency potential. In addition, the technology makes us independent of silicon, which is a rare and expensive raw material."
