REC reports record quarterly sales, close to full utilization

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The strong U.S. market is continuing to deliver strong demand to REC Solar, with the company registering shipments of 207 MW to the market in Q3 2015. Combined with 82 MW of sales to Europe, with UK comprising the bulk of these sales, REC is enjoying close to full utilization at its vertically integrated production facility in Singapore.

Fully owned by Norway’s Elkem since May of this year, REC plans to draw on OEM producers in Southeast Asia to expand its output to 1.6 GW in 2016.

REC’s success in the U.S. market is due to a number of factors, reports senior vice president for sales and marketing Luc Graré. With supply deals to solar leasers SolarCity and Sunrun delivering strong demand for its 60-cell modules, in Q3 the company has also shipped significant volumes of its 72-cell modules, now average power output between 295-315 W, to the U.S. PV power plant market. REC is working with five or six major U.S. EPCs on it utility scale project supply in the country.

Sales for the quarter of 362 MW for Q3 do not represent a significant change over its Q2 performance, however it is the biggest quarter for module shipments in the company’s history. Graré reports pre-tax margins of around 8-10%.

“REC Solar’s success in the U.S. really began several quarters ago when there was the initiation of the antidumping tariffs on Chinese manufacturers,” Graré told pv magazine. “This caused some panic by some larger potential customers for us [about module supply]. These customers then came to us because we are manufacturing in Singapore.”

Production update

REC reports that its high efficiency Twin Peak module series has been well received in the market. The module was awarded an Intersolar Award in 2015 and incorporates half-cut cells, four-busbar cell interconnection, PERC technology, and a split junction box to deliver increased power output.

“That is very well received and actually we are working on expanding the production capacity of that product, because there is more demand than we can produce at the time being,” said Graré. REC currently has capacity to produce 100 MW of Twin Peak modules annually at present, and is looking to expand that to between 170-190 MW in 2016.

In terms of production, REC is utilizing its in-house ingot and wafer capacity of around 900 MW to supply much of its cell and module production, however will work with local suppliers to make up the shortfall. Parent company Elkem Solar supplies REC with much of its polysilicon, with Elkem itself currently verifying the business case as to whether it will re-open the 900 MW Heroya ingot facility in Norway.

“The investment decision is still pending,” Elkem informed pv magazine in a statement. “We will make a decision early 2016 about whether it will start up [the Heroya facility]. In this case the capacity will be 900 MW solar silicon blocks.”

REC plans to expand its module capacity to 1.6 MW in 2016, by achieving full utilization at its 1.3 GW Singapore facility and through working with OEM partners in Southeast Asia.

Wider markets

Beyond the U.S., REC Solar remains optimistic regarding the outlook for the UK market. Graré said that the company expects the UK to see between 1.8-2 GW of solar installed in 2016, with Q1 being particularly active. He noted that Northern Ireland might see an uptick in installations along with the neighboring Republic of Ireland – where FITs are expected to be enacted.

REC is also becoming increasingly active in the Middle East and in Africa (MEA). Having signed an agreement in Egypt to supply some 50 MW of modules, REC is also active in Dubai, Jordan and has is establishing three sales units in Africa, primarily targeting Ghana, South Africa and Kenya.

REC will again participate in this year’s World Future Energy Summit in Abu Dhabi in January 2016.