by Matt Margolis
GT mentioned during the Q4 2013 prepared remarks that their Merlin technology, “comes out a research operation we established in the Bay Area, over a year ago, to focus on advancing the state of the art in the design and assembly of solar cells and modules”. GT referred to a “research operation,” which immediately set off my alarm that the Merlin product was not inside a San Francisco PV module warehouse but a state-of-the-art R&D facility located in the Bay Area that focuses on PV module performance and durability. GT does not have a R&D facility or even an office in the Bay Area, which only leaves one option; a research lab that is run by a PV module maker. GT typically goes after strategic deals with the best and the biggest companies in their target market (Sapphire – Apple), so it only makes sense that GT would reach out and try to work with one of the top 3 or 4 PV module makers. According to Solarbuzz 2013 rankings the top 3 PV module makers were
- Yingli Green Energy
- JA Solar
- Trina Solar
If I was to develop a game changing technology with a PV module maker I would not only want to the biggest fish but I would want someone I trust. Someone that I have worked with years! As it turns out Yingli Green Energy not only was ranked #1 for producing solar cells but their relationship with GT Advanced Technologies (formerly GT Solar) goes back to 2002, when Yingli became GT’s first customer in China. Also, if you look at the various orders placed over time by Yingli the press releases contain language that translates to “hey scratch my back and I’ll scratch your back.” If you don’t believe me, read these comments between GT and Yingli’s within this order announcement from 2010 to that is focused on celebrating GT Solar’s 1000th DSS450 Crystalline Ingot Growth Furnace shipment as well as the very close relationship between the companies.
GT Solar International, Inc. (NASDAQ: SOLR), a leading global provider of polysilicon production technology, crystalline ingot growth systems and related PV manufacturing services for the solar industry, today announced that it has achieved the milestone shipment of its 1,000th DSS450TM crystalline ingot growth furnace. The recipient of the system is long-time Chinese customer Yingli Green Energy Holding Company Limited.
“GT Solar is a trusted and valued partner for Yingli,” said Mr. Liansheng Miao, chairman and chief executive officer of Yingli Green Energy. “Their ingot growth furnaces consistently produce high quality material which helps to reinforce our company’s reputation for delivering reliable products to our customers.”
“We are pleased that Yingli continues to express confidence in our ingot growth technology,” said Tom Gutierrez, president and chief executive officer of GT Solar.
Yingli Green Energy became GT Solar’s first customer in China in 2002 when they set up the first ingot, wafer and cell production lines at their Baoding headquarters. These production lines launched Yingli into the PV manufacturing industry and today they are one of the world’s leading fully vertically integrated PV manufacturers. Yingli has continued to invest in GT Solar’s multicrystalline ingot growth furnaces including the DSS240, which was introduced in 2003, and the current DSS450, which was introduced in 2007. Today, GT Solar has shipped over 1300 crystalline growth furnaces to customers around the world.
It’s very clear that Yingli and GT have a mutually beneficial relationship and both have admiration and appreciation of the benefits that have resulted from their long partnership. GT has enabled Yingli to continue to be a leader in the PV module space while Yingli’s investment in GT equipment has allowed GT to expand their business and invest money in their R&D to support the next generation of equipment that will benefit Yingli even more.
Yingli announced on July 12, 2011 that they were opening up a R&D facility in the San Francisco Bay Area for comprehensive product testing and evaluation. Furthermore, the announcement indicates that the new research and development lab will accelerate our understanding of module performance and reliability. Additionally, R&D facility lab will allow them to evaluate new technologies and deliver next generation products.
Yingli Americas also announces the opening of a new research and development facility in South San Francisco for comprehensive product testing and evaluation.
“Our new research and development lab will accelerate our understanding of module performance and reliability,” said Brian Grenko, Director of Operations for Yingli Americas. “This investment will enable us to more quickly evaluate new technologies, deliver next generation products, and better serve our customers throughout all stages of a project’s life cycle.”
“We now have the ability to offer product testing and development support within the U.S. for our customers here,” added Mr. Petrina. “We plan to use this new facility to proactively address market opportunities and trends to better support our pre- and post-sales efforts – a sign of our continued dedication to technical leadership.”
Image from Yingli
Image from Yingli
Additional Images of Yingli’s PVTL obtained from Greentechmedia
Yingli is very interested in reducing the cost of PV modules evidenced by their strategic agreement with Dupont that was signed in February 2012 for $100 million. Yingli reupped on the contract and extended it another year for an additional $100m last June. Under the terms of the terms of the agreement, Yingli China will purchase materials including DuPont™ Solamet® photovoltaic metallization pastes that help boost the power output of solar cells and DuPont™ Tedlar® polyvinyl fluoride film that has been proven to protect solar panels even in the harshest environmental conditions. I have some bad news to report for Dupont, the silver paste sales to Yingli may shrink up to 80% from the previous levels.
PV expert Mark Osborne, from PVTech summarizes this one very simply, “GT Advanced Technologies has launched a c-Si solar cell metallisation and interconnect technology that it claims will boost conversion efficiencies while lowering production costs via significantly reduced silver paste consumption”. In another article about Merlin, Osborne points out that “GTAT ‘Merlin’ metallisation and interconnect technology reduces silver paste needs by 80%“. It appears that one of the biggest losers from Merlin’s entry into the PV module world will be Dupont, who will likely see most, if not all of their $100 million materials contract centered on silver paste evaporate and shift over to GTAT before the summer is up.
GT mentioned that Merlin came out of a research operation that was established over a year ago. I was able to retrieve a copy of GTAT’s Investing in Continued Growth and Diversification presentation, that was discussed in August 2012 during Canaccord Genuity Growth Conference. What is interesting on this presentation is that GTAT actually spills the beans that they “are considering opportunities to move downstream solar equipment market to support next generation solar cell and module manufacturing.” As it turns out it took GT less than 2 years to mention an opportunity and to bring it to the market. This is exactly the same broadcasting GT has been doing over the last 2 years with sapphire cover screens. It will come as no surprise to the long-term GT followers when Apple releases sapphire cover screens across their upcoming iPhone 6 line-up. When GT’s management says they are confident and all that is left is execution, the message is clear, they are going to get it done! Merlin technology is “discussed” in the second bullet point on the image below from the August 2012 conference presentation.
If you are wondering what else GT brought up during the August 2012 conference especially relating to sapphire cover screens, please see the image is below. BTW does Apple make LCD TV’s?
Clearly GT’s Merlin PV module technology fits like a “T” within Yingli’s PV Testing Lab’s primary focus area and the facility is located in the Bay Area and it was established more than a year ago. The contract announcement in 2010 between GT Solar (renamed to GT Advanced Technologies) clearly exhibits the GT co-dependencies, trust as well as a high level of engagement between both companies. Additionally, Yingli has been ranked near the top of the PV Solar Cell Producing charts for the last several years and they are well positioned in the solar industry to keep growing the top line and improve their bottom line with the help of GT’s Merlin Technology. I don’t know about you but I think Yingli was the “secret” partner that helped GT perfect the Merlin technology and I fully expect Yingli to be the first customer of GT’s Merlin Technology. Furthermore, I’m expecting Yingli and GTAT to once again celebrate their long tenured relationship and continued partnership within Merlin’s inaugural order announcement before the end of this summer.
Full Disclosure: I am long GTAT and have no plans to buy or sell anything holdings in the next 72 hours