In-Depth Interview With Natcore's CEO And Director Of Research And Technology

Jun.16.14 | About: Natcore Technology (NTCXF)

Summary

Natcore's proprietary technology has a Chinese manufacturer excited.

Natcore has engaged the Fraunhofer Institute in Germany to help produce the very best product possible.

Natcore is attracting more interest from larger companies in the solar industry as they move closer to commercial production.

On June 12th, 2014 I had the chance to speak with Natcore's (OTCQB:NTCXF)(NXT.CA) CEO, Chuck Provini as well as Natcore's Director of Research and Technology, David Levy.

They graciously took the time to provide an update on what's happening with Natcore's progress towards commercial production of solar cells using black silicon and the company's proprietary diffusion process.

Chuck Provini: In our last discussion, we said that we were we were going to send silicon wafers with our black silicon etch to one of the largest equipment and solar cell manufacturing companies in China. The Chinese manufacturer was then to complete the solar cell production process and conduct some tests on the finished cells. The purpose of this exercise wasn't just to see what the efficiencies were going to be, but it was the first time that anybody who has been working with black silicon had actually run it through a true commercial factory.

Most if not all of the people we know of are doing their solar cell R&D in university laboratories using one-inch square solar cells, you know they're just science projects. But we took basically the standard solar wafers, did our magic to them, and sent them to China. After their processing, the Chinese scientists ran them through a series of tests. The results they got were very good in two areas:

  1. Something called lifetime, which we'll explain later;
  2. The efficiency was not as high as they normally achieve, but they felt that this shortcoming could be easily fixed.

But we do something that is proprietary with our diffusion process; we didn't tell them about it because we're very concerned about protecting our IP. So envision this: Say there are ten steps to making this solar cell; we might have done, say, the first five. And it was during that first five we did this very special diffusion process and sent wafers to them.

As a result of that, what we did in the special process was better than what they do in their process. That's why they were very excited about what the results were. And we didn't tell them what it was (Natcore's proprietary process).

The next five steps are the steps we're going to need some help from them in order to get the efficiencies up. There are some other reasons that they're not up. David will talk about. And then I'm going to say one more thing and I'll turn it over to him. (Dr. David Levy).

We have engaged the Fraunhofer Institute for Solar Energy Systems to, in essence, help us with those other five steps, so that we're doing the same thing in both arenas. Fraunhofer ISE is located in Germany. They're very well-known throughout the world.

The Chinese manufacturer is very concerned about optimizing performance, but frankly, they're not as concerned about the efficiency as they are about the primary reason the black silicon is good, and that's reducing the cost by 23 percent.

Fraunhofer is basically trying to make the very best product possible with us, which also gives us some proprietary benefits with the IP. So, that's a quick fifty thousand-foot level overview, and David if you can kind of fill in some of the blanks.

David Levy: As Chuck mentioned, one of the interesting things about our black silicon and the reason it can fit right into an existing solar process, is that we're doing a very rapid wet process to produce the black silicon. When you look at a number of other research groups looking into this and other organizations, often they're doing fairly sophisticated things to produce the black silicon which, where the costs of that process would, while interesting scientifically, take it out of the running to incorporate it into a manufacturing plant.

And so the steps we do are very quick, it's all in open air with wet processing, it takes a minute or two for us to do our processes, like Chuck was saying we have a lot of proprietary technology. Then we give the wafers to the manufacturer, and the manufacturer goes on and turns them into solar cells, where the key to the technology is what we've done to the wafers to start with.

The Chinese manufacturer had a couple of concerns with things they feel that they can fix in order to bring the efficiency up even higher and so they were really quite excited about it because they could see a road to getting there. (increasing efficiency and commercialization).

The reason to work with Fraunhofer is that the Chinese manufacturers, like any manufacturers, have guys out on the production line who have a couple of knobs that they can turn, but they're really only familiar with those knobs, and that's how they tweak their process in order to get it improved.

So the reason to look to a research organization like Fraunhofer is that there are a number of things that can still be done very cost effectively in a solar cell FAB line, even with existing equipment, but where you really need the expertise of people who are very well trained in the science and technology in order to look for those improvements. This is where Fraunhofer can help us out a lot.

We have a good lab, but obviously there's no reason for us to have the industrial equipment that is in a FAB, so we can only take the process only so far. Then you go to someone like Fraunhofer who has not only the scientific know-how, but also the equipment that's the same as what would exist in a FAB to really help you define what are the exact pieces that will need to be in the process in order to achieve the efficiency percentages that will make it into a product.

Chuck Provini: So hopefully we're going to come up with something with Fraunhofer that's going to be great and wonderful, that we will then be able to deliver to the Chinese a product where we own all of the IP.

David Levy: Another point worth talking about is what is referred to in solar cell manufacturing is "lifetime." When light shines on a solar cell it generates electric charges. The longer those charges can stay around the more chance they have of being used to generate electricity and not just wasted. And so the longer they live is called the "lifetime."

The lifetime is an indicator of how well your surface can be passivated (treated). In fact, that was another reason why this manufacturer in China really sat up and took notice, they were really excited about the results, one of which had nothing to do with efficiency but just having to do with the "lifetime." This is because people normally associate black silicon with having a poorer lifetime than conventional cells and suddenly they looked at ours after we had done our proprietary diffusion process, and the passivation was in fact better, meaning the lifetime was higher.

And I think it was the combination of that with the fairly promising efficiency results that cause them to say "this is a technology to take a look at."

Mike Allison: Chuck, in our last interview about six months back, you also mentioned that one of the big potentials is working with governments to build best-of-breed solar plants. Is that something you're still working on and how is that progressing?

C.P.: Absolutely! We actually have helped put together three business proposals for individuals who are assigned by their governments to put up some kind of an actual budget for these facilities. Since you and I spoke, we've got a meaningful relationship with someone in India now, as well as in South Africa.

What happens with these projects is the government doesn't typically do it on their own. They will identify somebody that they've had good experiences with, that has experience in some manufacturing or building facility and that person will be given whatever the grant is or authority to do it and a budget. And then we will start working with that group or company instead of the government.

So we have made the transition in each of those countries from the government itself to the people who've been tasked with it, who are now companies and/or individuals who provide a portion of the financing with the grants that are given. We're still very involved in that, and frankly it's a little bit of synergy with the Chinese manufacturer we've been working with, because again, they're one of the largest solar equipment manufacturers. So we have a lot of access to their equipment as well as going to the normal best-of-breed people in Germany or whatever. So there's a lot of movement and margins when you're dealing with that.

For instance, you can build a thirty megawatt solar facility, and the price for the equipment will range anywhere from six million dollars to thirty million dollars, depending on who you buy it from. We're still very involved in that and I wouldn't be surprised if the first bit of revenue we get is some type of engagement fee to be a consultant on one of those projects.

Mike: Regarding a deal with the Chinese manufacturer that you've been working with, how close are you to signing a deal with them?

Chuck: Obviously you're always reluctant to come up with time frames, but I think, based on where we are with the negotiations, I think we're going to see a joint development agreement within weeks and a joint venture agreement within the next three months.

MA: David, there was the back-side contacts that our readers would also like to hear some background and updated information on.

David: Sure. What we're heavily getting into right now is a project involving laser processing and particularly the laser processing of cells where we put all the contacts on the back side of the cell. Typical solar cells that you see would have the front grid contacts, and that front grid, as you would expect, it makes a shadow and reflects some light and that light can't be used. So there's a lot of advantages to going to a cell with all back contacts.

So the question is, why is a company like Natcore getting into laser processing? The answer is that we have black silicon as a near-term technology, something that can go into current solar cell FABs, but we also want to look at technologies to leverage our strengths and that are disruptive. Certainly, processing all of the cells by laser and putting all the contacts on the back, that combination would be very, very disruptive.

And in fact, as Chuck has told you before, last year we had a review with our scientific advisory board and we said "here is our current technology, here are our current strengths. Where could we apply this in order to get something disruptive that would come out pretty soon?" And that's how we came up with this idea of doing these laser-processed cells.

And so the idea behind that is, today when you make a solar cell in a factory, like our Chinese partner for example, there are a number of steps where the entire cell is heated, most significantly in order to do the step called "doping."

You put the wafer in a big furnace, you heat the whole thing. It's difficult to easily control where the doping goes because when you heat the whole wafer the doping goes into the whole wafer. It also causes a lot of thermal stress on the wafer. And so if you could do exactly what you want to do, what you'd want to do is do doping by heating the cell only in very small points. And that can be done by using a laser.

So, when it comes to what are the strengths that make Natcore a good choice to do this, one of the main things is world-class expertise on our advisory board. One of our advisory board members, Dave Carlson, really knows a lot about this field. He's pointed us to university collaborations, which we've taken advantage of, but also has helped us really come up to speed internally on this process. So, through him we get a lot of knowledge that wouldn't necessarily be easy to come by.

The other thing is that between me and some consultants we've been able to leverage in the area, there's a lot of expertise in laser optics, and in mechanical systems that are used in these types of laser systems. And a really critical aspect of these laser processed cells (and black silicon) is passivation. And that's something that Natcore has become quite good at.

And so when we really looked at all these things it appeared to us that we want to put another egg in our basket, so-to-speak, something that can leverage our strength and that has a chance to be disruptive, this whole idea of the back contact laser-processed cells is what comes out.

Mike: Is Natcore the only company that is doing this at the moment?

David: No, there is some other university research going on, but the angle that we're taking with it, there aren't many people doing that, and that's where we're using this proprietary knowledge from our advisory board. The type of laser processing we want to do has not made it into commercial production, and we would really like to be the ones behind that.

Mike: This is obviously working in the lab, correct?

David: Yes, we have our lasers operational, we're making our first test cells and we expect a fair amount of progress in the next couple of months. The work is ongoing in the lab.

Mike: And then is your idea that once you can make this process commercially viable, would you then sell that to a manufacturer, like your Chinese partner?

David: In a disruptive technology like this, what we would end up doing is generating IP out of the particular way we do this. Then we'd want to call in an equipment manufacturer who would help us jointly create a system that uses our technology. So there would be royalty revenue, there's revenue on the equipment that comes from there. So we'd need to partner with someone to make that system and then that system would be sold into manufacturers.

In fact, later this month we're meeting with a German company with laser experience to discuss this idea of how would we bring this process to a saleable piece of equipment that others could use.

What this would also do is take out the element of dealing with individual manufacturers. We would then have a piece of fairly sophisticated proprietary equipment that can go to many manufacturers at- a- time, and they would have low incentive to try and engineer around that equipment, they'd rather just buy it.

Chuck: Which is no different than our model with everything else we're doing. At some point there's got to be a piece of equipment that is adapted to accommodate what we're doing with black silicon or anything else.

There are two other things to mention here. The German company found us, we didn't call them. They're coming to our lab on the 23rd of June to look at what we're doing and help evaluate it and figure out if they could start designing a machine to do this.

The second thing that's important about this, and I preach it all the time, is that the making of a solar cell is one of the most toxic things you can do. And with the black silicon, one of the biggest reasons for the reduction in cost is that we're eliminating one of the fusion furnaces. This backside contact would eliminate the other one.

Mike: Right now there are two furnaces used in the process, correct?

David: That's correct. You would have a furnace to do the diffusion and a furnace to do the silicon nitride passivation. The black silicon approach that we're taking, the low-cost approach, eliminates the silicon nitride. And then the laser-processing would eliminate the even higher-temperature diffusion furnace.

Mike: So the first furnace can already be eliminated using your wet-passivation process, correct?

David: It's actually the second one we've already eliminated.

Mike: Okay. And the first one could be eliminated with the laser technology, correct?

David: That's correct. The heating would be very readily accomplished with the laser. It's as much about energy usage too. There's a big difference between using a big furnace that stays hot and heats the whole wafer and using a laser to do the heating.

Mike: Right. And as you mentioned, because the laser is so concentrated on one specific spot there's a lot less stress on the whole wafer.

Chuck: That's correct. I was going to say, when you put a wafer into a furnace, just by the nature of exposing it to that kind of heat you limit some of its potential upside efficiencies. So by not doing that and just localizing the heating with the laser, you keep its potential much higher.

Mike: Yeah. It's kind of similar to what is being done with some cancer treatments now. Instead of just blasting the whole area to kill the cancer but kills everything, with some treatments they're using lasers to pinpoint that particular area where the cancer is and then the good cells are left intact.

Chuck: There's one other thing I wanted to mention. Dennis Flood, who's one of the founders of Natcore and our CTO, is a member of the IEEE and each year goes to the IEEE conference, and he's there right now. It's kind of an old boys network and sometimes I wondered about the value of these conferences. Because frankly, I thought we're being kind of premature.

But suddenly, this year we're getting enquiries from some pretty large companies because of our black silicon process. We were speaking with Dennis over the telephone yesterday, and he said that for the first time since he's been with Natcore he's got people tracking him down because they are interested in what we've done with black silicon, and that we're close enough to commercialization that now some very big companies are starting to pay attention to it.

Mike: I want to thank both of you for taking the time to update Seeking Alpha's readers who are closely following the progress of Natcore.

Disclosure: The author is long NTCXF. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.

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