Silicor raises US$105 million to support UMG polysilicon in Iceland

Iceland is not a place that is mentioned much in the solar industry. As an island entirely powered by geothermal energy, Iceland has no substantial solar market. It has also not been a location for manufacturing in any part of the solar value chain.

Until now. On Wednesday, Silicor Materials announced that it has secured commitments for US$105 million towards building its first commercial-scale facility to produce upgraded metallurgical-grade (UMG) polysilicon in the island nation.

Investors who have committed to supply equity capital include a mix of Icelandic pension funds and Silicor’s long-time investors such as Hudson Clean Energy Partners and Centra Corporate Finance. Silicor CEO Terry Jester notes that the company still has more money to raise, but she expects to begin construction of the plant in mid-2016.

Metal production tool supplier SMS Siemag will provide equipment for the plant, and Danish construction company MT Højgaard will build it with support from Icelandic subcontractors.

When ramped, the facility will have the capacity to produce 16,000 metric tons of UMG polysilicon annually, making it more than three times as large as the next-largest UMG plant that sells into the solar industry. It will also the be the sixth-largest polysilicon plant of any technology in the world.

This will be significant progress for UMG, which has had to overcome a bad reputation in the solar industry. Silicor notes that UMG suffered from inconsistencies in quality and supply in 2007 and 2008, however it says that it is having good success with the customers it works with.

“Customer acceptance is not an issue,” notes Silicor Executive VP of Sales, Marketing and Business Development Michael Russo. He says that in addition to having secured dedicated supplies of aluminum and electricity, that the plant has letters of intent from customers to purchase 75% of the plant’s output.

September has been a big month for UMG polysilicon. Earlier in the month, Elkem announced that it will open a portion of a former REC wafer facility in Norway, to produce silicon ingots and blocks from UMG polysilicon from its plant in Kristiansand, Norway.