Tek Seng counts on solar cell business

BUKIT MINYAK: Tek Seng Holdings Bhd’s solar cell business is to generate about 70% of the company’s revenue this year, given that the order book has been filled till the end of this year.

Group managing director Loh Kok Beng told StarBiz that Tek Seng was gradually increasing the solar cell production capacity to 10 million pieces per month from 5.6 million pieces currently, or about 250MW production capacity.

“We now have a total of seven lines, of which three will be fully operational in September. Two more production lines will be added by end of 2016, which will increase the total number of lines to nine by the end of this year.

“With nine lines in full operation, our capacity per annum from end 2016 onwards would be 740MW or about 156 million pieces of solar cells, which will have a market value of US$234mil, based on today’s market value of solar cell,” Loh said.

He added that given the market value of US$1.50 for a piece of solar cell, the total value of 10 million pieces per month would be about US$15mil.

“The price of solar cell has gone down to US$1.50 per piece from US$1.60 earlier this year due to the drop in silicon wafer price to 82 US cents, compared to 90 US cents earlier this year,” Loh said

He added that the company’s solar-cell orderbook had been filled to the end of the year.

According to the Colorado-based global research house IHS, the demand for solar modules would grow, stemming from the increased global solar installation demand, and this could reach 65.5GW this year.

The IHS report noted that module shipments would exceed 2015 numbers by 10%, with revenues hitting US$41.9bil.

According to SolarPower Europe, the new EPIA (European Photovoltaic Industry Association), the cost of solar power installation has come down quicker than expected and the trend will continue.

“The lowest reported in-house module production cost (including depreciation) in China was 37 US cents per watt in the first quarter 2016,” the report said.

Canadian Solar, one of the three biggest solar companies in the world by revenue, targets module cost to be as low as 29 US cents per watt by the fourth quarter of 2017, according to the SolarPower Europe report.

The growth in solar power installation in Europe this year is expected to decline, according to SolarPower Europe, as contractors with solar power projects are waiting for prices of solar cells to come down further.

The global installation of solar power is expected to hit 97GW by 2020, up from about 50GW in 2015, according to the report.

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