Chinese solar manufacturer Longi Solar is set to splash another RMB2.4 billion ($349 million) on expanding its mono silicon module production capacity, this time in the Chinese city of Taizhou.
The Shanghai-listed solar giant revealed plans to expand its annual production capacity for high efficiency modules with a new factory, warehouse and ancillary facilities to extend its existing base in the city district of Hailing.
In an update to the Shanghai exchange on Saturday, Longi admitted: “The above investment in the project may cause pressure on the company’s cashflow” but the mono giant pledged to arrange all necessary funding.
Longi Green Energy Technology Co Ltd said the new facilities would “gradually start production in 2020” and, more specifically, no later than six months from now and added full production would be in place no later than two years from now.
Longi will lease fab
The stock market update revealed Longi signed a deal a week ago with the people’s government of the district of Hailing under which the solar manufacturer would fund the new fab and own the production equipment while leasing the buildings from the local authority for 20 years before having the option of purchasing the structures or renewing the lease.
As part of the arrangement, Longi had helped the local council attract supply chain related businesses to the city district.
The expansion is part of an aggressive bid to increase global market share by a company which is already the world’s biggest mono silicon module supplier.
With the publication of its annual figures in April, Longi said it wanted to achieve 16 GW of annual module production capacity this year, helped by the opening of a 5 GW fab in the Anhui province of China a month earlier. The Taizhou fab is set to help the company achieve the 25 GW module production target it set for next year, with plans to raise that figure still further, to 30 GW, by the end of 2021.
This article was amended on 21/06/19 to emphasize Longi will own the production equipment at the fab and would lease only the buildings from the local authority.