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Schott Solar opens plant despite downturn

Germany-based Schott Solar opens $100 million plant in Albuquerque, N.M., to expand its U.S. operations, but the timing of follow-on investments is still not clear.

Schott Solar on Monday dedicated a $100 million solar equipment manufacturing plant in Albuquerque, N.M., although an industry downturn has kept its growth plans in check.

The Germany-based company picked New Mexico to be the hub of its U.S. operations because the U.S. solar business is poised to grow significantly in the coming years, said Gerald Fine, CEO of Schott North America.

It will manufacture solar panels aimed at businesses and consumers as well as make solar concentrator receivers, a piece of equipment for utility-scale solar thermal installations. The receivers circulate a fluid, heated up by mirrored troughs, which is converted into steam to make electricity.

Schott's Albuquerque, N.M., plant will make flat solar panels as well as concentrating solar receivers, pictured here. Schott Solar

The near-term outlook for solar concentrating systems at solar power plants in the Southwest is strong, Fine said. But prices for solar panels, typically fitted onto rooftops, are falling across the industry. Subsidies in Germany and Spain--the two largest solar marketplaces--are being scaled back and there is now more silicon available to make solar cells. Both factors are contributing to less business for solar manufacturers and lower prices.

Schott has committed to making a total of $500 million in investments in the U.S., but the timing for its follow-on investments is still not firm, Fine said.

The federal recovery package is making loans available for renewable energy projects and has changed the rules so that investors don't need large tax bills to take advantage of subsidies. But those measures aren't yet implemented which, combined with the industry downturn, has stalled some activity, Fine said.

"We are probably acting a little slower than I would have expected a year ago in committing to another round of investment," said Fine. "I would have guessed we would have deployed that money already but we haven't as we wait for clarity."

The operation in Albuquerque, which started operating in January, employs about 300 people and will employ about 350 by the end of the year.

Fine said New Mexico Gov. Bill Richardson, who attended the inauguration, was involved in Schott Solar's U.S. expansion plans from the beginning.

"Overall, I feel pretty good about the prospects for growth in North America. Our medium to long-term position hasn't changed at all about the opportunities in this country," Fine said.