Moser Baer bags $500 million orders for solar modules

NEW DELHI, INDIA: Moser Baer India Ltd has entered into definitive agreements to supply solar modules to major European solar system integrators.

The agreements, with a cumulative value of more than $500 million, envisage supply of amorphous silicon Gen 8.5 thin film panels by PV Technologies India Ltd, Moser Baer’s photovoltaic subsidiary, up to the year 2012. The customers include Ralos Vertriebs, one of Europe’s largest system integrators, and Colexon Energy, a leading player internationally in commercial photovoltaic plants. Both are based in Germany.

The agreement terms include fixed price take or pay obligations, fully secured by bank guarantee/L/Cs from first class international banks.

Ravi Khanna, CEO of the Moser Baer Photovoltaic Limited, said: “The signing of these key customer contracts is further indication of the rapid growth of our photovoltaic business and the faith of our customers in the thin film technology. Moser Baer is pursuing a differentiated strategy in this high growth business and we are poised to be a global leader in solar PV.”

Yogesh Mathur, Group Chief Financial Officer of Moser Baer, added: “This is a significant step forward in developing long term strategic relationships with top tier players in the sector, as well as securing revenues and cash flows for the business.” Moser Baer had recently announced raising over Rs. 415 crore ($93.5 million) through a consortium of private equity investors to fund the ambitious growth of its solar photovoltaic business. In all, the wholly owned photovoltaic subsidiary has raised well over Rs. 800 crore ($193.5 million) of private equity funding.

PV industry growth

Higher energy costs, declining fossil fuel supplies and a thrust on reducing carbon emissions have ensured that the worldwide interest in the renewable energy space and particularly PV continues to grow. Driven by recent significant technological advancements, it is estimated that the solar market will have a 43 per cent CAGR and is poised to achieve grid parity in the short to medium term.

Current demand projections translate to a market value of $50-70 billion by 2010. The solar market has grown from $13 billion in 2008 to an estimated $40 billion this year.

Demand from Europe (Spain, Italy and Germany) has been very strong. A key trend in solar energy sector is the diversification away from the top markets like Germany and Japan. Spain and other European countries and the US will continue to drive demand through 2009. The growing demand in developing work countries like India and South Korea will further drive the market up.