First Solar admits to unsuitability of its products to hot climates

M. Ramesh Chennai | Updated on November 23, 2017 Published on March 04, 2012

American company First Solar, major supplier of cadmium telluride-based thin-film photo-voltaic modules to India, has admitted that its products are not suitable for hot climates. Reliance Power is a major customer of First Solar.

“We believe our PV modules are potentially subject to increased failure rates in hot climates,” Mr Mark Widmar, the company's CFO, told analysts last week.

Last September, First Solar won an order from Reliance Power to supply 100 MW worth of thin-film modules.

The deal was backed by a $84.3 million (Rs 375 crore), 16.5-year loan by the US Exim Bank. First Solar has orders worth more than 200 MW in India. Stressing the “critical role” played by the US Exim Bank in First Solar's India business, Vishal Shah, a Deutsche Bank analyst has said that India could “represent 20 per cent of First Solar's production in 2012”.

More warranty payments

“Our experience has shown that our warranty rates for hot climates are slightly higher than for temperate climates,” Mr Widmar told analysts. First Solar said that one of the reasons for its fourth-quarter operating loss of $485.3 million was higher warranty payments

As imported thin-film modules are cheaper, and often backed by easy loans, they have found favour with Indian developers. Further, developers who have won projects under the National Solar Mission have to buy locally if they opt for ‘crystalline silicon', but are free to import if they choose ‘thin-film'.

(Of the three thin-film technologies, which differ according to the coating material, cadmium telluride (CdTe) is believed to be the most mature and cost-effective, while the other two technologies — CIGS and amorphous silicon — are still evolving.)

Toxicity issues

First Solar is the biggest CdTe supplier to India, but there are others too. Its compatriot Abound Solar has orders worth 10 MW in India. Its supply of modules to a 5MW project of Punj Lloyd is also backed by a $9-million US Exim Bank loan.

According to a recent report of Navigant Consulting, CdTe has been losing market share, yielding ground to CIGS. Also, CdTe has caused frowns because cadmium is toxic. Suppliers have offered to buy back the modules after their effective life is over, but still questions like ‘who is to guarantee this' are being raised.


Published on March 04, 2012
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