First generation products are always a nice “gee-whiz” sort of thing. Following-generation products, unfortunately, need to deal with the realities of a product performing to a certain level. In most instances, making the leap to this following level is a difficult one as most consumers of the following generation product have a certain expectation of what the product needs to be able to do. If an investor can find that following generation product and a solid manufacturer behind it, he/she may have a solid route to profit.
Daystar Technologies Inc., a thin-film photovoltaic products company, develops, manufactures and markets photovoltaic products directed primarily at the solar panel utility market. The company’s primary product line is a copper-indium-gallium-selenide (CIGS) thin-film on glass or flexible-foil photovoltaic cell.
The company’s driving force comes from its following generation nature. While first generation solar cell manufacturers are concentrated on solar cells manufactured with silicon wafers, Daystar Technologies works with materials and processes directed at enhancing cost and performance efficiency rather than just making the cell work. In this respect, the company has advanced to meet and beat per/watt cost requirements as compared to more mainstream forms of solar energy generation.
From this perspective, the company anticipates being able to reduce total module manufacturing cost to below $1.00 per watt as it ramps. Past the cost involved with the manufacturing process, there are other issues surrounding manufacturing a following generation solar product. Simply being a following generation implies that that there was a former generation. As the company is targeting utility scale customers, it needs to address compatibility issues in addition to efficiency and cost issues. The company’s CIGS process and associated components seamlessly integrate with existing utility level voltage and connection requirements, making the product a more logical choice as utilities seek to ramp and replace larger flat panel systems.
Currently, the company is working to bring the first 25 megawatts of manufacturing capacity on-line. Funding for that manufacturing capacity is apparently in place with a first quarter 2009 date being set for panels to come off the line. Space is available and a schedule has been set for an additional 75 megawatts of production, but financing has yet to be placed. Fortunately or not, the company has no debt financing and seems justifiably reluctant to enter the current credit markets even if it could find financing with acceptable terms.
75% of the company’s 25 megawatts of production capacity is already spoken for through 2011, however, it does seem that it will be able to deal with ramping production to the 100 megawatt level, which is necessary to reach the sub $1.00 level and reach profitability as conditions become more favorable. From all appearances, Daystar Technologies looks to have its program pulled together and running on schedule. The current economy may throw a short delay into the mix, but for the most part the company is moving forward nicely.
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