Energy Conversion Devices, Inc. (ECD Ovonics) (NASDAQ: ENER) today announced that United Solar Ovonic, its wholly owned subsidiary, has entered into an agreement to form a joint venture with Tianjin Jinneng Investment Company (TJIC) to establish a 30-megawatt (MW) photovoltaic (PV) module assembly facility in Tianjin, the People's Republic of China.
The joint venture, to be owned 75% by United Solar Ovonic and 25% by TJIC, will assemble solar modules using solar cells supplied by United Solar Ovonic's Michigan-based photovoltaic cell manufacturing facilities and is expected to begin operation in 2008. The joint venture will have nonexclusive rights to sell PV modules and systems in China. Sales outside China will be through United Solar Ovonic. The joint venture will also have certain rights to sell small products up to 32 watts outside of China.
The parties anticipate that the module assembly equipment will be installed in mid-2008. United Solar Ovonic and ECD Ovonics personnel will supervise the installation of equipment and provide assistance and training during the startup phase of the joint venture.
The agreement is subject to the approval of Chinese authorities.
United Solar Ovonic's parent company, ECD Ovonics, recently accompanied U.S. Commerce Secretary Carlos M. Gutierrez on a Business Development Mission to China, and credits its participation in that mission as being instrumental in leading to the joint venture.
"China is a key market for American businesses, and I am pleased that United Solar Ovonic has formed a joint venture agreement with TJIC to establish a solar module assembly facility in China," said Commerce Secretary Gutierrez. "This unique alliance will encourage export of solar cells manufactured in the U.S. creating jobs for American workers, and is a tangible result from our trade mission last November. The trading relationship between U.S. businesses and Chinese companies is critical for both countries' continued economic success."
In a joint statement, James R. Metzger, Executive Vice President and Chief Operating Officer of ECD Ovonics, and Subhendu Guha, President and Chief Operating Officer of United Solar Ovonic, said, "The significance of this joint venture to us is two-fold. First, it provides us with a vehicle to access the rapidly expanding Chinese market, and second, it accelerates our cost-reduction initiatives through the establishment of assembly facilities in China, tapping the highly skilled and low-cost labor. We have been active in China for several years and are pleased to expand our activities and establish our first solar module assembly facility in China with TJIC, which has extensive knowledge and operating experience in the business environment in the Chinese market."
"We are very pleased to have formed this joint venture with United Solar Ovonic, the leader in thin-film photovoltaic products and technology and look forward to a long and fruitful collaboration with our joint venture partner," said Yun Shang Tong, General Manager of TJIC. "The renewable energy laws passed by the Chinese Government envision 10% of total power from renewable energy by 2020. TJIC has over 5 gigawatts of installed electrical generating capacity using traditional energy, and we look forward to our joint venture becoming a leading supplier of clean energy in China using United Solar Ovonic's unique flexible thin-film PV modules."
United Solar Ovonic currently has 58MW of annual production capacity, which includes the new 30MW per annum Auburn Hills 2 manufacturing facility the company placed in service in December 2006. United Solar Ovonic is also constructing two 60MW per annum PV cell manufacturing facilities in Greenville, Mich., which are expected to begin operation in late 2007 and mid- 2008. The company's expansion plan will increase United Solar Ovonic's manufacturing capacity to 118MW, 178MW and over 300MW per annum by the end of calendar years 2007, 2008 and 2010, respectively.
About United Solar Ovonic
United Solar Ovonic, building on technology invented and pioneered by ECD Ovonics, is the world leader in thin-film amorphous photovoltaics. Because of characteristics unique to the United Solar Ovonic solar cell technology, such as lightweight, ruggedness and flexibility, it is ideal as building-integrated photovoltaic roofing systems for residential and industrial customers. ECD Ovonics holds the basic patents covering the continuous roll-to-roll manufacturing of thin-film amorphous-silicon alloy multi-junction solar cells and related products. More information is available at http://www.uni-solar.com/.
About Tianjin Jinneng Investment Company
Tianjin Jinneng Investment Company (TJIC) is engaged in the investment and business management for power, thermal energy and renewable energy. It has grown significantly in the last 10 years with its assets exceeding RMB 23.5 billion Yuans and has been a China Fortune 500 company for the last three years. With its focus on the energy sector, Tianjin has 5.6 gigawatts of installed capacity catering to 83% of the electrical needs for the City of Tianjin, the third largest city in China after Beijing and Shanghai. It has been recognized as one of "the 100 super enterprises of Tianjin" from 2003 to 2006.
About ECD Ovonics
ECD Ovonics is the leader in the synthesis of new materials and the development of advanced production technology and innovative products. It has invented, pioneered and developed its proprietary, enabling technologies in the fields of energy and information leading to new products and production processes based on amorphous, disordered and related materials. The Company's portfolio of alternative energy solutions includes Ovonic thin-film amorphous solar cells, modules, panels and systems for generating solar electric power; Ovonic NiMH batteries; Ovonic hydride storage materials capable of storing hydrogen in the solid state for use as a feedstock for fuel cells or internal combustion engines or as an enhancement or replacement for any type of hydrocarbon fuel; and Ovonic fuel cell technology. ECD Ovonics' proprietary advanced information technologies include Ovonic phase-change electrical memory, Ovonic phase-change optical memory and the Ovonic Threshold Switch. ECD Ovonics designs and builds manufacturing machinery that incorporates its proprietary production processes, maintains ongoing research and development programs to continually improve its products and develops new applications for its technologies. ECD Ovonics holds the basic patents in its fields. For more information about ECD Ovonics visit http://www.ovonic.com/
This release may contain forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on assumptions which ECD Ovonics, as of the date of this release, believes to be reasonable and appropriate. ECD Ovonics cautions, however, that the actual facts and conditions that may exist in the future could vary materially from the assumed facts and conditions upon which such forward-looking statements are based. The risk factors identified in the ECD Ovonics filings with the Securities and Exchange Commission, including the Company's most recent Annual Report on Form 10-K, could impact any forward-looking statements contained in this release.