That's not because it's easy, or even because it's a good idea to try, but when well over a billion dollars in investment pours into a given technology, something is bound to come out the other side - eventually. A seductively high efficiency potential technology with very low potential materials costs, CIGS has been just over the horizon for a decade or more, but has enjoyed a huge influx of capital and increase in the number of programs chasing in over the last 5 years. Similar to other solar thin film technologies, device complexity, effective yield, throughput, and process control issues are always the bugaboo.
Given its seductivenes, its somewhat capricious nature, and the siren filled history of the technology, perhaps we should think of CIGS like a woman, and all men need a few rules of thumb to keep in mind before we jump in. Here are mine (for CIGS, not women):
Number one, like most thin film technologies, $100 mm in investment is the ante up to play the game. Just because you spend it doesn't mean you get real product out, and with CIGS, you tend not to know whether anything is workable until oh, say $50 to $100 mm is already spent.
Number two, what you think you know, you don't. Until the pilot plant has been operating for a few years, companies generally really underestimate what they don't know.
Number three, remember those experiments and great idea you sold your investors on, the hard part is not there, the hard (read risky) part is ALL in the "it's just engineering" end of the scale up process you told the investors was "fairly straightforward". This isn't IT, it's deposition with a very commoditized end product.
Number four, whatever the projection as far as timing, add 3 years, maybe 5. I'm not kidding here, I said years.
Number five, when the words "fast", "roll to roll", "reel to reel" or anything else equating to speed in the process are in the pitch deck, translate that to read excruciatingly slow in the development timeline, and lots of "issues" popping up in those nasty yield and process control areas.
Number six, when investing, be very careful about that "yield" number and the "capacity" numbers they made up based on it. All thin film development companies keep "little black books" with the data and charts on every process run they've ever made. Read every single one of those charts, and ask lots of stupid questions about why only 4% of the total square footage produced is above 6% efficiency in run XYZ. Think in terms of "effective total average yield". That's where the problems are hiding.
CIGS watchers have a number of darlings to follow. There's Miasole, which now under new management is rumored to have substantially tightened down its development discipline to take it's shot, Nanosolar, another Silicon Valley venture darling that has been described by many observers along the lines of, "never met hype they didn't like", but with a seductively low cost printable process if they can get it to work, Solyndra, the "stealth" company with the big sign on I-880, Heliovolt, the Texas-based hot CIGS deal of last year, which burst on to the fundraising scene on the back of it's still extremely early stage "FASST" technology. And those are just the largest of the US based venture backed deals, without including Honda, IBM, DayStar, Ascent Solar, Solopower, and literally dozens upon dozens of others around the world with significant backing (though all at a very, very early stage). Wikipedia has a decent cut at a list, though by no stretch of the imagination comprehensive.
My best estimate is that most of the venture investors in each of those deals personally looked in depth at the manufacturing process of single digit numbers of competing approaches before investing. And only read the little black book on two of them. That strategy was tried, with ahem, "mixed" results, in fuel cells a few years back. We'll see how well it works in thin film solar.
And of course, as with most things in solar, the major players should probably be watched more carefully than the startups. I've always liked larger companies to crack thin film issues, in no small part because the term "stage gate" tends to mean something to them.
But my personal favorite for front runner currently is Arizona based Global Solar, a solar company I have been following for years. Their announcement a few months ago of 10% efficiency in production runs, was pretty much lost in the crush of press around solar, for reasons unfathomable to me.
While admittedly not yet proven in a full production environment (they are working on the scale up to 30 MW plants) they do have the massive advantage of having run virtually the only operating CIGS pilot plant in the world - and I believe have shipped more volume of CIGS product than anyone if not everyone else. True to form, that technology, which originally came out of the Tuscon Electric backed ITN Energy Systems labs in Colorado which later did Ascent Solar, has had an estimated $150-$200 mm plus invested in it over the last decade, before Solon AG bought the company for a reported $16 mm. Though to be fair, current management under CEO Mike Gering was brought on well into that process. So while I'll keep my fingers crossed that some one will crack the CIGS nut, and continue to be flabbergasted at the $1 Bil plus valuations estimated to have been achieved by some of the startups named here for very large science projects, when it comes to the one to watch, Global Solar is my personal pick.
Neal Dikeman is a founding partner at Jane Capital Partners LLC, a boutique merchant bank advising strategic investors and startups in cleantech. He is the founding CEO of Carbonflow, founding contributor of Cleantech Blog, a Contributing Editor to Alt Energy Stocks, Chairman of Cleantech.org, and a blogger for CNET's Greentech blog.
Life is just not getting better for Miasole.
Dow Chemical announced Monday that it has selected Global Solar to provide copper-indium-gallium-selenide (CIGS) solar cells for its solar roofing project with the Department of Energy. Last May, the Department of Energy gave Dow a three-year, $9 million grant to develop solar roofing under the Solar America program.
Global Solar Energy replaced Dow's original CIGS solar cell provider. And who was that? Miasole.
Rumors also swirl that a three-year research grant under the Solar America program made directly Miasole is coming to an end. The company received $5.8 million in the first year of the program, which started last year, and could qualify for up to $20 million over a three-year period, assuming it met its goals. (Miasole was participating directly, and as a partner with Dow, in Solar America.). Sources close to the Energy Department, however, have said that the Miasole grant isn't being renewed.
Fifteen months ago, Miasole seemed headed for success. The company had pulled in more than $56 million in venture capital and said it was set to begin production of thin film CIGS cells in 2007. Many believed the company would be the first to come out with CIGS commercially. But by spring 2007, Miasole in bringing its products to market last year. The solar cells coming off of the company's initial production line were on average only able to convert 4 percent to 6 percent of the sunlight that struck them into electricity, below the company's 8 percent to 10 percent goal.
The company also had to lay off employees and swapped management teams.
By contrast, Global Solar moved into commercial production late last year, around the same time as Nanosolar, and says it is producing CIGS cells with 10 percent plus efficiency. Global uses evaporation techniques to deposit the CIGS materials onto film. It's less high tech than some of the processes used by Miasole and other CIGS firms, but Global likes to point out that it does work.
Again, we have not spoken to Miasole. We do not have a clear understanding why Dow switched CIGS providers and have not officially confirmed that the grant made directly to Miasole under the Solar America program will not be renewed. The Global Solar/Dow announcement, however, is somewhat unambiguous.
Dave Pearce, the founder and former CEO of thin film solar cell manufacturer Miasole, is tackling another angle of the solar economy with a new company.
The company, named Nuvosun, is trying to develop a film that will prevent moisture from penetrating, and subsequently screwing up the performance of, thin film solar panels, according to sources in the solar industry. Moisture penetration is a problem with thin film solar panels as well as organic light emitting diodes, or OLEDs, so Nuvosun may ultimately have two markets. Currently, however barrier films aren't cheap.
CNET News.com contacted Pearce, but have not heard back to confirm these details. However, we know for certain that Nuvosun is the name of the company. He's listed as the CEO of Nuvosun on his LinkedIn profile.
A former hard-drive executive, Pearce was one of the first people in Silicon Valley to try to exploit IT technology know-how to build an energy start-up. Miasole specializes in thin film solar cells that extract electrons from sunlight with copper indium gallium and selenide, or CIGS. CIGS solar cells have existed for years in national labs--the problem has been how to mass manufacture them cheaply and reliably.
Miasole engineers developed a system that sputters the crucial chemicals very precisely onto glass or polymer sheets. Hard drive makers use sputtering machines to spread magnetic particles onto platters. The company received millions in VC funds from, among others, Kleiner Perkins Caufield & Byers and VantagePoint Venture Partners.
Unfortunately for Miasole and Pearce, Miasole was also one of the first companies to discover how difficult the energy business can be. After riding high in 2006, the company missed internal deadlines for production and revenue goals in 2007. Getting a high yield of product out of the solar sputtering system proved problematic. Much of the early investment was used in trying to develop the machinery, according to several sources.
Pearce stepped down as CEO and eventually left the company. Layoffs followed. (Miasole certainly wasn't alone in this regard. Tesla Motors, Imperium Renewables, Phoenix Motorcars and , among others, experienced similar comedowns in 2007.)
There is a very strong chance that former Miasole employees work at Nuvosun. Pearce is regarded highly by many former associates.
The superheroes of venture capital haven't exactly had a completely smooth year in green tech.
Kleiner Perkins Caufield & Byers wasn't the first VC firm to get into green tech. Nth Power, NGEN Partners, Draper Fisher Jurvetson and Mohr Davidow Ventures got there first, but Kleiner brought a lot of attention and prestige into the field, and helped push green tech toward the top of the VC agenda in the second half of 2004.
The firm also began to put money into a lot of companies with a pretty good amount of fanfare. John Doerr even cried in public at the TED conference to show his commitment.
This year, though, came with its rough patches.
For one thing, some of the firm's portfolio companies suffered setbacks. Thin-film solar-panel maker Miasole had to delay production and swap CEOs. Rumors that the company laid off 40 employees was confirmed by three former Miasole employees, according to Greentech Media. The Web site also said founder Dave Pearce may have left the company.
Similarly, supersecretive EEStor (another portfolio company) delayed production. Board member and Dell alum Mort Topfer also left the board, according to reports.
Mascoma, the cellulosic-ethanol maker, fared better. It landed grants with Michigan and Tennessee to build plants in those states, but its first plant, in New York, will come on line about a year late.
Conversely, Kleiner's name has been absent from the big success stories. EnerNoc and Comverge both launched IPOs this year. In solar, Suntech Power Holdings and First Solar saw tremendous growth. None of these are Kleiner companies.
Other companies outside the firm's portfolio had delays too. Tesla Motors put off its car and switched CEOs as well. But this is Kleiner Perkins we're talking about here.
In the 650 area code, people instinctively genuflect at the mere sound of the name. When Al Gore joined the firm a few weeks ago, it was national news, though many wondered what he would exactly bring to the table. The firm gets praised for its foresight on a regular basis, so it's fair (in my book, at least) to harp on the setbacks.
Still, the firm's portfolio does contain a number of strong companies: Mascoma, Amyris Biotechnologies, Ausra, GreatPoint Energy. And the firm commands billions of dollars, while I shop at Target.
Next year could easily be a completely different story.
Back in October, we called Miasole, which makes copper indium gallium selenide (CIGS) solar cells, about a rumor that the company cut about 50 employees and planned to close its Shanghai operation.
Founder Dave Pearce, however, said the rumors were overbaked. The company got rid of some contractors but that was about it, he wrote.
"We have recently hired a number of senior engineering, operations, and sales resources, not laid them off. We have no plans to shut down our Shanghai operations," he wrote in an e-mail to CNET News.com in October.
Today, VentureWire wrote that sources outside the company say Miasole has laid off 40 employees. Miasole did not comment on the story. Sources in the CIGS world however have been telling us that they had been receiving resumes from Miasole employees for the past several weeks. So even if people haven't been laid off, employees seem to be restless.
Hopefully, the answer will come out soon. Either way, 2007 has not been the company's year. It had to delay products and change its management team. The problem, according to several sources and company executives, is that the company is not yielding as many solar cells off of its production line as hoped. The solar cells themselves are also not as efficient at converting sunlight to electricity as hoped.
Miasole has raised over $85 million, but in CIGS that's nothing too out of the ordinary. Competitors HelioVolt and Nanosolar (which just started initial production) have raised over $100 million.
Former Vice President and Nobel Prize winner Al Gore has joined venture firm Kleiner Perkins Caufield & Byers as a partner to concentrate on green technology investments.
(Credit:
CNET News.com)
To date, Kleiner Perkins has had something of a mixed record when it comes to clean tech. The firm has invested in Miasole, which recently swapped CEOs and has had to delay products. It is also an investor in EEStor, a mysterious supercapacitor company that has delayed its product and is going through some management changes. The firm has also not been part of some of the early, successful IPOs in clean tech like EnerNoc or First Solar.
On the other hand, it has placed money in some companies that many believe have a lot of promise: Ausra, the Australian solar thermal company and Mascoma, a cellulosic ethanol company that has laid plans to build three plants in the U.S. (with millions in state subsidies). It also has a stake in Amyris Biotechnologies, one of the early companies in synthetic biology. Amyris makes compounds for treating malaria and wants to get into feedstocks for synthetic fuel.
So who knows. Compared with these guys, I live in abject squalor.
Gore is one of a number of "name" individuals the firm has recruited over the years. Others include heir Will Hearst III, former Oracle honcho Ray Lane, and Sun Microsystems scientist Bill Joy.
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