BP closes solar plant in Maryland – July 25, 2011
BP might be investing left and right in wind farms in the US but when it comes to solar cell and wafer manufacturing, the wind has gone out of this business’ sail because of material pricing woes.
BP announced last week that it will shut down its solar manufacturing facility in Frederick, Maryland, and sad as it may be, this move makes financial sense given the fact that cheaper materials are being manufactured in places such as China and even India.
Fresh from a recent trip hosted by polysilicon manufacturer WackerChemie, I was able to get a small glimpse of how the solar materials market is currently going through, and like BP, Wacker had to sell its stake in a solar wafer manufacturing joint venture Wacker Schott Solar GmbH in October last year because of continuous poor market conditions.
I’ll post more about Wacker later but in the meantime, BP said the Frederick facility will cease its silicon casting, wafering, and cell manufacturing although sales and marketing, research and technology, project development, as well as key business support activities will continue. 320 positions will be eliminated out of 430 at the plant.
BP said it will shift its remaining in-house manufacturing to its low-cost joint ventures and regional supply partners to be more cost-competitive to its customers.
“Solar prices declined between 40 and 50 percent since the onset of the financial and economic crisis, compressing industry margins and driving solar power towards grid competitive pricing,” said ReyadFezzani, CEO of BP Solar. “By shifting our supply to a high quality, low-cost supply base to serve both distribution customers and large-scale projects, we have strengthened our position as a provider of competitive solar solutions with our offer of the highest lifetime value.”
BP said it has reduced its unit costs by more than 45% since closing several other high-cost manufacturing locations that began in the first quarter of 2009.