Millinet Solar, Global Top PV Maker in Korea

Nurtures solar energy as future growth engine

By Lee Sang-chul, Representative Director of Millinet Solar Co., Ltd.

Recently I stumbled across a brilliant TV commercial that shows an abstract of the Korean economy; you may have nodded in understanding while watching this commercial. The narrator said, "If Korea were an oil producing country, would we ever be able to grow into a world number one shipbuilding nation?" and "If we were not trying to make everything faster and faster, would Korea be able to grow into the world's top digital nation?" Thomas L. Friedman, New York Times columnist and Pulitzer Prize-winning author of The Lexus and the Olive Tree and the more recent Hot, Flat and Crowded, visited Korea several weeks ago and stressed the significance of green energy as a future growth engine for our future survival. Friedman emphasized that Korea has the greatest potential to be a leading country in the new renewable energy industry because Korea has scarce natural resources, but affluent human resources.
It seems cliche to take solar and wind energy as the inevitable solutions for our environmentally devastated planet on a moral basis. Apart from the sustainability, in the perspective of economics alone, no other business can compare to or replace renewable energy in terms of both market size and its future growth potential.
Though the world economic turmoil has suddenly obscured the outlook for the solar industry, the solar power sector will continue its ascent. There has been an impact on the solar industry from the global financial turmoil. Shipments have been delayed and projects are being called off because most solar energy end users are connected to project financing.
The solar sector is not immune from the aftermath of this global economic crisis. However, the solar industry has been accustomed to fluctuations of policy and economy and we have managed to grow over the past few decades. There is no doubt that the solar industry will show real growth after this crisis.
Historically, in volume terms, the solar industry has experienced exponential growth as shown in the graph below. Cell/module production of 3.9GW in 2007 has grown to 7GW in 2008, and is expected to increase to at least 52GW by 2012.
This equates to a 68 percent compound annual growth rate with significant upside potential. The combination of rising volumes and declining prices means that solar sector revenue is poised to expand from $27 billion in 2007 to $274 billion by 2012. With increasing economies of scale and incremental improvements in the manufacturing process, cost reductions will come at a pace that will enable the solar sector to finally reach a competitive price with 'grid parity.g In fact, prices have plummeted and industry experts and analysts are warning that those who are not ready for cost competitiveness as low as grid-parity level will not be able to survive longer and 2009-2010 will be a threshold to leap on to a real round of growth for the solar sector. It is not surprising to hear about a gigantic solar company's M&A news these days. Indeed, it is darkest before the dawn.

KOREAN GOVERNMENT SOLAR POLICY
Solar power installed in Korea in 2005 reached a total of 30MWp. People used to say the government's goal to reach 1.2 GW of solar installations by that time seemed way too ambitious and had a rather skeptical view of korean photovoltaic (PV) industry in the future. The Display Bank's market research showed that South Korea installed 274 MW worth of PV systems in 2008, making the country the fourth largest market in the world. It is a ten times growth in three years, and by 2009 Korea will add another 400 to 500 MW.
We expect to reach the 500 MW level soon within 2009 and the government will have to implement long-term support before the RPS system begins in 2012. Feed-in tariff has contributed to boosting the solar power sector in most parts of Korea.
The feed-in tariff program was modeled after the German system, where utilities are required to buy solar power at government-set rates. Those rates are higher than the prices for conventional electricity, making installing and operating solar power projects lucrative ventures.
The government's efforts have made Korea an attractive market for solar energy equipment makers and project developers in other countries. Companies such as European in Germany, Solar Power in Roseville, Calif., and Evergreen Solar in Marlboro, Mass., have inked deals to sell panels.
California Gov. Arnold Schwarzenegger even weighed in on the discussion, saying a focus on the environment will boost the economy and create green jobs. "Of course we are now facing tough economic times, but that's why we need to focus on solar and [the environment]," he said. "We should not listen to those who say [that] should take a back seat. That's just plain wrong." The Vision of Millinet Solar ― A world's top solar player brings energy independence to Korea.
Millinet Solar entered the solar business in 2005. When we first entered the solar field, DCC had not yet entered the poly-silicon business and it was hard to name big PV players in Korea then. Only small- and medium-sized module assemblers or distributors for foreign companies participated in some PV power plants in Korea. Much has changed and some are even concerned about an overheating atmosphere in the solar energy sector.
We hear more often about conglomerates announcing they are taking the plunge into the solar business and it seems straight to establish a vertically integrated value chain in the rush. Korea is now regarded among the top five solar markets worldwide. Compared to when we first started in 2005, as the only multi-crystalline solar cell maker, now the production capacity of solar cells will reach 1 GW in 2010.
If we think about Germany, the most advanced solar nation, it reached 4 GW of installed solar power in 2007 and celebrated its achievement of 1 percent of the overall energy mix. Though the solar industry has achieved remarkable growth of over 50 percent compound annual growth rate year after year, we still have a long way to go. We are in the beginning of the transition and we should be prepared for the time of real growth for the solar industry.
What makes us survive in this fiercely competitive atmosphere at the threshold of real growth? Millinet Solar always tries to be the first and move ahead when others hesitate. It is obvious that the solar industry, likewise the entire renewable sector, is the only option left for the next generation. To be a global leading PV company is a part of Millinet Solar's ultimate goal and we hope to contribute to helping our nation become an energy-independent country.
Solar will soon be able to win in cost competitiveness with grid electricity, and the key to achieving grid parity will be technology. Millinet Solar has always sought new innovative technologies and has never hesitated to move forward for a better future. Millinet Solar dreams of the future when we export our solar energy to the Middle East, where we had bought fuel for the last half-century.

ABOUT MILLINET SOLAR :
Millinet Solar is the first multi-crystalline solar cell manufacturer in Korea. We currently operate a 30 MW capacity line and plan to increase our capacity to 150 MW by the second half of this year. We also plan to expand our capacity further to 300 MW by 2010. Our main products are multi-crystalline solar cells, with dimensions of 156mm x 156mm. nw

Lee Sang-chul, Representative Director of Millinet Solar Co., Ltd.

(left) The facade of Millinet Solar's plant in Daegu that has a photovoltaic power lamp and the production line of the plant

(left) Millinet Solar researchers work on solar energy together with Ukrainian scientists.; and Minister of Knowledge Economy Lee Youn-ho and Millinet Chairman Lee Sang-chul take a look on the exhibits on display at Green Energy Expo last May in Daegu.