The capital intensity of photovoltaics manufacturing: barrier to scale and opportunity for innovation
Name
Buonassisi_The capital intensity.pdf
Size
3.31 MB
Format
Adobe PDF
Checksum (MD5)
3fafbac285ed3d05fa54c1bd76404d26
Author(s)
Powell, Douglas M.
Fu, Ran
Horowitz, Kelsey
Basore, Paul A.
Woodhouse, Michael
Buonassisi, Tonio
Date Issued
September 2015
Journal
Energy & Environmental Science
Publisher
Royal Society of Chemistry
Citation
Powell, Douglas M., Ran Fu, Kelsey Horowitz, Paul A. Basore, Michael Woodhouse, and Tonio Buonassisi. “The Capital Intensity of Photovoltaics Manufacturing: Barrier to Scale and Opportunity for Innovation.” Energy Environ. Sci. 8, no. 12 (2015): 3395–3408. © 2015 Royal Society of Chemistry
Version
Final published version
Abstract
Using a bottom-up cost model, we assess the impact of initial factory capital expenditure (capex) on photovoltaic (PV) module minimum sustainable price (MSP) and industry-wide trends. We find capex to have two important impacts on PV manufacturing. First, capex strongly influences the per-unit MSP of a c-Si module: we calculate that the capex-related elements sum to 22% of MSP for an integrated wafer, cell, and module manufacturer. This fraction provides a significant opportunity to reduce MSP toward the U.S. DOE SunShot module price target through capex innovation. Second, a combination of high capex and low margins leads to a poor financial rate of return, which limits the growth rate of PV module manufacturing capacity. We quantify the capex of Czochralski-based crystalline silicon (c-Si) PV manufacturing, summing to 0.68 $/W[subscript aCap] ($ per annual production capacity in watts, $year/W) from wafer to module and 1.01 $/W[subscript aCap] from polysilicon to module. At a sustainable operating margin determined by the MSP methodology for our bottom-up scenario, we calculate the sustainable growth rate of PV manufacturing capacity to be ∼19% annually – below the historical trend of ∼50% annually. We conclude with a discussion of innovation opportunities to reduce the capex of PV manufacturing through both incremental and disruptive process innovation with c-Si, platform innovations, and financial approaches.
MIT Department
Massachusetts Institute of Technology. Department of Mechanical Engineering
Terms of Use
Creative Commons Attribution 3.0 Unported licence
Persistent DSpace Link
DOI of Published Version
https://doi.org/10.1039/C5EE01509J
