Nanosolar, a privately funded solar energy company,
announced this week that it had secured 647,000 square feet of
manufacturing
space in San Jose. This is noteworthy because a facility that size will
have the
ability to produce an annual capacity of 430 megawatts' worth of solar
power --
or three times the amount that is presently installed in the U.S.
If Nanosolar's technology can scale to this level, it could become a
major
player in the solar industry. Moreover, because it employs a new
thin-film
technology that uses little to no silicon -- the costliest part of solar
cells
-- it might even allow it to become the dominant player in the field
because the
technology is so disruptive.
To date, the company has received venture funding from
Google (NASDAQ: GOOG)
founders Larry Page and Sergey Brin, and this past summer it received an
additional $75 million to begin building this facility. (It also signed
an
agreement with Coenergy, one of Europe's solar
companies, in
August to help develop its technology.)
So, is Nanosolar's success guaranteed? No. For starters, many of
today's
leading solar companies, such as BPSolar (NYSE:
BP),
Kyocera (NYSE: KYO),
and
SunTech Power (NYSE: STP),
are all
continuing to produce more efficient silicon solar cells. As such, they
are
unlikely to either be easily replaced or to go down without a serious
fight.
Secondly, many of these companies, as well as Sharp,
EnergyConversion Devices' (NASDAQ:
ENER)
Uni-Solar, Miasole, and Harris & Harris'
(NASDAQ:
TINY) portfolio company, Innovalight, are all in various stages of
developing their own thin-film technology which, in some cases, may be
closer to
development.
And lastly, Nanosolar could encounter any number of bumps in ramping
up its
thin-film technology -- which remains untested in a large-scale
manufacturing
process.
Still, everything from the funding to the securing of the
manufacturing space
seems to suggest that things are coming together nicely for Nanosolar.
For this
reason, I believe it is a company that investors who are interested in
solar
energy need to put on their radar screen.
I say this not because I believe it will go public anytime soon and
would
represent a good buy (although it might), but rather because thin-film
technology is a disruptive technology and a facility of this size could
cause
some serious problems for many of today's leading publicly traded solar
companies. After all, the sun has been known to burn people on occasion.
There's
no reason that it can't do the same to investors.
Interested in other solar Foolishness?
Check out these articles:
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Fool
contributor Jack Uldrich
always recommends using sunscreen when playing in the sun for more than
15
minutes. He owns stock in SunTech Power. The Fool has a strict disclosure
policy.
