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    • Fri Nov 30th 12:22 PM | Rating: 0 0
      Commented on:
      Reality Check: First Solar and Tellurium
      As Mark said, FSLR will use 10% to 20% of global Te production next year, not 1% or 2%.

      Other number/typo errors:
      1.7%=> 1% (Te cost as % of current profit at 1.5 micron)
      0.3% => 1% (Te profit as % of copper profit)
      "10 tonnes to make 100 GWp" => "10 tonnes to make 100 MWp" (typo)
      PE of 20 in last sentence should be PE of 10 (correctly stated elsewhere)

      With that many numbers, 2 or 3 errors could be expected.
      View article »
    • Fri Nov 30th 11:59 AM | Rating: 0 0
      Commented on:
      Reality Check: First Solar and Tellurium
      If you find a significant source of Te that is better than a few hundred 100 ppm, please let us know. I do not invest in faith of the invisible. All sources I have seen do not indicate there is any other substantial source, at any price. Gold is the only metal of the USGS's 9 rarest metals group (that includes Te) that is mined in the 2,000 tonnes/yr range you're hoping for. Gold costs 120 times more and has had centuries of research and investment. The least expensive of the others is palladium, 50 times more than Te and has 1/2 the Te production.
      View article »
    • Sat Nov 24th 10:32 AM | Rating: 0 0
      Commented on:
      First Solar Vulnerable to a Tellurium Shortage?
      Even if he's an expert on the subject, he seems to be hyping Te availability when he says "there are other sources" besides copper. That's a 90% lie by not admitting the other sources can account for only 10%.

      OK, that the first point he made. Second point: 1000 tonnes/yr to get 10 GW/year (2012 by all CdTe makers). 1000 tonnes/yr is 3 times more than 2006 total production, and it has to be distributed among all CdTe makers. If all the other industries still need the 300 tonnes they used last year, that's 4 times more Te needed. That means 4 times more copper has to be mined in 5 years. If we double recovery efficiency of Te, "only" twice as much copper is needed in 5 years.

      Therefore his first and second points are refuted.

      His third statement is also not true. He states FSLR can go from 3 to the theoretical limit of 1 micron WITH an improvement in efficiency BEFORE trapping is used. The whole reason they have trouble getting thinner is because it results in a loss of efficiency. The April 2007 paper below (page 9) shows a team in the lab that was able to get 11.9% as the best efficiency from 1 micron CdTe. FSLR is already claiming 10.7%

      www1.eere.energy.gov/s...

      I'd say the best FSLR can hope for in 5 years is getting down to 1.5 micron and MAINTAIN efficiency. He and I are also assuming lifespan and efficiency under HOT FIELD conditions can be maintained.

      So let's assume half as much Te per W is needed in 5 years by going from 3 to 1.5 micron and maintaining efficiency. Going from 3 to 1.5 microns means they'll be 4 times closer to the theoretical limit of 1 micron before efficiency is loss. So it's not a doubling of difficulty to go from 3 to 1.5, but it's a factor of 4 improvement in accuracy and consistency in deposition without losing production line speed. This requires 35% improvement per year in (production line speed) x (efficiency) / (thickness minus 1 micron). Someone can check last 2 years to see if they have been improving this fast in the past.

      For the 5-year time frame, there's enough Te for CdTe and 200 tonnes left over for existing industries ... **IF** ... all of the following occur: Te recovery rate is doubled under heavy price demand, copper production increases 5% per year, and CdTe thickness is cut in half. It's entirely possible. This will provide enough Te for 10 GW in 2012 which should be enough for the intire CdTe field to keep its current growth rate. For the 6th year, it is impossible for Te to not slow the growth. At 10 times current value (to create strong demand to double recovery assumed above), Te will cost 10% of FSLR's profit at 1.5 micron, so 20x increase in Te is feasible. (assuming $250/kg today). Purifying cats are consttant and already in FSLR guidance of $1.3/W profit now and in future. Falling dollar increses Te cost, but increases $ profit for euro-sales even more.

      If light-trapping without more CdTe has been demonstrated in the lab for CdTe, I hope he'll let us know. I found a paper that says 0.2 micron is theoretically possible with light trapping, eventhough 0.8 is the theoretical limit based on 0.8 micron light passing right through thinner layers. In the lab, 1 micron is the limit for simple CdTe layers.

      Tellurium will devastate CdTe expansion rate before 1Q 2013. No one has posted anything to refute this.
      View article »
    • Thu Nov 22nd 21:07 PM | Rating: 0 0
      Commented on:
      First Solar Vulnerable to a Tellurium Shortage?
      My data comes from the research article mentioned. I don't know if his sources are NREL or not. I know the USGS reports only what it can see and therefore underestimates tonnes/yr, and it says this in most of its reports. The quality of the government employee's writing in the USGS report, along with the understandability of the report was far below the published research. I listen to the smartest people I can find on a subject, and he says 780 tonnes/yr is possible at current copper production and better recovery methods. Copper production is going up 5% a year, so in 5 years, the Te pool could be over 1000 tonnes/yr. FSLR could have a strong hand in that pool if it has contracts and investor money to direct the Te to themselves.

      I have no reason to believe that FSLR will not be able to obtain 100 tonnes/yr (1GW/yr). It seems clear that 1,000 tonnes/yr (10 GW/yr) is improbable. The gray area is between and it's a difference of PE=60 and PE=5. I think they will someday be able to get 300 tonnes/yr, but the PE will never drop below 20 at this $200/share price. Maybe in 10 years with steady 5% copper annual increase they can get even up to 2000 tonne/yr (20 GW/yr). New copper plants in new reserves can even get them beyond the 21000 tonnes of known reserves the USGS reports. So the 3 or 5 to 10 year range for FSLR should see a major slow-down because of Te.

      A 2000 article that a lot of web sites cite claims 20 GW/yr, but I think it's outdated, as the newer research says Te averages 100 ppm instead of the previously believed 200 ppm. Of course some have higher concentrations than others, but it does not materially affect the discussion.
      View article »
    • Thu Nov 22nd 17:08 PM | Rating: 0 0
      Commented on:
      First Solar Vulnerable to a Tellurium Shortage?
      I read the following article and have a few comments.

      Progress in Photovoltaics: Research and Applications
      Volume 14, Issue 8 , Pages 743 - 751
      "Improved Estimates for Te and Se Availability from Cu Anode
      Slimes and Recent Price Trends"

      The article says that with an estimated 12 million tonnes of Cu anode processed, there is the theoretical possibility of 1300 tonnes Te per year. At historically prevailing extraction efficiencies of 33%, this corresponds to Te availability as 430 tonnes. Efficiency can be improved to possibly 60%, or 781 tonnes/yr. Actual Te production in 2003 is estimated as 304 tonnes, 50% higher than USGS.

      FSLR is be doubling capacity every 15 months (440 MW end of 2007, 790 MW end of 2008). That's 4.6 GWp by end of 2011. If current world production of Te doubles by then and they acquire 75% of all Te, that's 450 tonnes. Please note that this is a very FSLR-friendly view. At the expected (internal and external estimates) 0.09 g Te/Wp (at best), that's 5 GWp. So it's possible they can have enough Te until end of 2011. It's a theoretical impossibility for them to keep the current trend past 2012 because there is only 100 ppm (new estimate) Te in copper, and all other sources are insignificant. My Te numbers come from a peer-reviewed source that seems more accurate than the numbers of the USGS.

      FSLR charges $2.48/Wp and contracts call for decreasing price 6.5% per year, or $1.9/Wp in 1Q 2012. Production cost is $1.15 and expected to reach $0.63 by 2012. That's $1.3/Wp profit now, and $1.3/Wp in 2012.

      If current trends hold and Te is not a factor, that's 1 GWp and $1.3B for 1Q 2012. At today's market cap of $16.5B, that's a P/E of 13. So today's price is entirely justified for those looking at 4 to 5 year time frame, and confident that we'll somehow get all the Te we can out of an 10% per year increasing supply of copper, and FSLR by itself outbids everyone else and the price does not increase more than the 2000% increase of the past five years ($5 to $100/kg). So a P/E of 13 at today's price in late 2011 is not impossible, but it requires faith. $200 a share is not insane for 2011.

      Now to examine the effect of Te price increase. If Te increases from $200/kg to $2000/kg, FSLR will lose $0.19/Wp. So Te could cost them $0.19 of the $1.3/Wp profit (15%) out of the 1GWp poduced in 1Q 2012, giving a profit of $1.1B and a PE of 15 in 1Q 2012 at today's $16.5B market cap. But increasing production after 2012 at current trend is impossible due to Te its relative non-existence on planet earth. A more reasonable estimate is that serious Te problems will manifest in 2011 if not 2010.

      Te going from $100/kg to $3000/kg is possible for FSLR to support and remain competitive and profitable and to beat out competitors looking for Te.

      My prices are for the standard 99.95%, not semiconductor grade which someone says FSLR does not require. Adjusting for the extra $500/kg needed to purify to semi-conductor grade, if necessary, does not overly-affect these numbers

      Optimistic view: FSLR will be able to acquire 1.5 times more Te in 4 years than the total world production of 2006 (304 tonnes). Current guidance from FSLR says this will mean a profit of $1.3B per Q starting 2012 and to hold at that level thereafter (PE=12). Look for Te to be $1,000 to $3,000/kg by then, and to hold steady thereafter. A factor of 10 increase in Te cost does not hurt FSLR very much. The research article said that price is "sustainable"... $3000/kg will cost FSLR $0.30/W just for the Te, reducing profit from $1.3 to $1/W giving $1B a quarter (PE=16).

      Pessimistic View: FSLR will only be able to acquire 50% of 2006 total Te production (150 tonnes) in 5 years. Production is therefore limited to 0.3 GW per quarter and PE stays above 40 from 2010 until 2012. This seems to me to be worst-case.

      I consider the following accurate: 100 ppm Te in Cu. No other substantial source. At least 0.09 g Te/Wp needed. 300 tonnes produced in 2006 at $175/kg. FSLR profit to remain $1.3/Wp for the next 5 years in absence of Te problem. World Te production cannot be more than tripled in 5 years. FSLR production is doubling every 15 months. FSLR cannot sustain current trend past 2012 due to Te non-existence. This last fact is the most assured.
      View article »
    • Thu Nov 22nd 10:59 AM | Rating: 0 0
      Commented on:
      First Solar Q3 2007 Earnings Call Transcript
      They seem to be doubling capacity every 15 months (440 MW end of 2007, 790 MW end of 2008). That's 4.6 GWp by end of 2011. If current world production of Te doubles by then and they acquire 75% of all Te, that's 450 tonnes. At the expected (internal and external estimates) 0.09 g Te/Wp (at best) is reached, that's 5 GWp. So it's possible they can have enough Te until end of 2012. It's a theoretical impossibility for them to keep the current trend past 2012 due to Te non-existence. My Te numbers come from a source that seems more accurate (and better for FSLR) than the numbers of the USGS:

      Progress in Photovoltaics: Research and Applications
      Volume 14, Issue 8 , Pages 743 - 751
      "Improved Estimates for Te and Se Availability from Cu Anode
      Slimes and Recent Price Trends"

      They currently sell for $2.48/Wp and contracts call for decreasing price 6.5% per year, or $1.9/Wp in 1Q 2012. Production ost is $1.15 and expected to reach $0.63 by 2012. That's $1.3/Wp profit now, and $1.3/Wp in 2012.

      If current trends hold and Te is not a factor, that's 1 GWp and $1.3B for 1Q 2012. At today's market cap of $16.5B At price, that's a P/E of 13. So today's price is entirely justified for those looking at 4 to 5 year time frame.

      If Te increases from $200/kg to $2000/kg, FSLR will lose $0.22/Wp. So Te could cost them $0.22 of the $1.3/Wp profit (17%) out of the 1GWp poduced in 1Q 2012, giving a profit of $1.1B and a PE of 15 in 1Q 2012 at today's $16.5B market cap.

      Today's price is reasonable for 2012. Doubling profit beyond that is not possible due to proven Te limitations. Te going up a factor of 10 to 20 is also supported. Te has to go up a factor of 50 for Te to make up 35% of a copper producer's profit (see last sentence). But even FSLR can't pay $1/Wp for Te. Both sides are right. Buying Te is smarter than buying FSLR, but FSLR price is justified.

      Look for profit of $1B per Q starting 2012 and to hold at that level thereafter. Look for Te to be $1,000 to $2,000 by then, and to hold steady thereafter. Te and competition are limiting factors. FSLR will be able to afford up $4000/kg Te in 2012, but no one will be able to produce it. Recycling vintage FSLR solar cells will become the least expensive source. Copper producers currently make 0.7% of their profit from Te ($200 profit/kg Te at 100 ppm Te in Cu => $0.02 Te in 1 kg Cu. $3 profit/kg Cu).
      View article »
    • Tue Nov 20th 16:06 PM | Rating: 0 0
      Commented on:
      Sunpower Has the Hype, Suntech Has the Growth
      Thanks for the point to palladium. My info concurs that 15% or so is a theoretical max, although i hear murmurings of combining technologies (layering, to capture different wavelengths). Algae is the best plant to capture sun energy and gets a max of 5%.

      My previous post really gives an overly optimistic view. Getting down to 1 micron loses some efficiency and the cells might not last as long. Using mirrors and tracking to double (triple is very unlikely) the light capture will also decrease lifespan. Because of the angles and stuff, it's hard to more than double.

      Everything is secretive with these metals. Maybe firstsolar does have serious research and contracts into where it's going to get it. The USGS does admit that it is not able to get data from some big producers for these metals.

      Just for accuracy: You mentioned 135 metric tons of Te per GW needed, but i read your blog and saw where this comes from 8 g Te per 2x4 foot panel. At 1 KW/m^2 sunlight, 12% efficiency, and 10.8 ft^2/m^2, I get 90 metric tons needed for 1 GW. Funny how that's exactly equal to my first-draft estimate based on the thickness needed and density rather than FSLR as my source. In their conference call they mentioned 70 watts per module. That would be 114 tonnes per 1GW if your 8 g is correct. One of the callers expected 500 MW by end of 2008. If the USGS data were correct, they would already have a problem in 2009 in trying to acquire 30% of the USGS's reported "world production" of 200 mtpy.

      As a reminder, 1GW of solar cells produce 0.2 GW averaged over a year. A typical power plant is 2 GW.

      I fear for your short position. I have the feeling people are going to hold on to this one. Of the 25 solar and alt energy stocks i watch, FSLR is in the top 5 for the day, and staying the closest to its peak. If they're not committing massive fraud in saying they have terrawatt levels of Te available, your short will have a hard time panning out.
      View article »
    • Fri Nov 16th 17:40 PM | Rating: 0 0
      Commented on:
      Sunpower Has the Hype, Suntech Has the Growth
      I was checking my numbers and needed to make a correction and clarification. At 1 micron thickness, CIGS needs 1.2 g In / m^2. CdTE requires 3 g Te / m^2 at 1 micron. For overestimates let's assume their is no waste in either process. 1 micron is also best case scenario. Let's also be kind and give them 15% efficiency. So we have (here's the correction) 8 tonnes In/GW peak required and 20 tonnes Te/GW peak required. World reserves of Te are 47,000 tonnes and In is 6,000 tonnes. It's ridiculous to think we'll get more than 50% of this. So CIGS has potential of 375 GW peak and CdTe of 1200 GW peak. To convert to actual electricity, divide by 4 because the peak is what you get at 1000 W/m^2 in brightest sun. We get 250 W solar insolation with systems tilted to lattitude and 24 hour average in southern U.S.. But multiply by 4 if using advanced mirror systems with good tracking. So we have 1.6 TW as an absolute max for CIGS and CdTe thin films. This is enough for the entire U.S. energy needs. More reasonable: we get 1/4th the available elements remaining and no mirror tracking: 200 GW. Total CIGS and CdTe might be 1 GW by end of 2008 or 2009, doubling each year, giving room for a run up for 8 years.

      I wonder if firstsolar investing ahead of time is the reason for the current run-up in Te. They've repeatedly said "we will not have a supply problem"
      View article »
    • Fri Nov 16th 16:57 PM | Rating: 0 0
      Commented on:
      Sunpower Has the Hype, Suntech Has the Growth
      I doubted your numbers since i had read a USGS report that Indium would be a problem for massive CIGS production, but that Te was probably not a problem for CdTe. However, for 3 um CdTe at 3 g Te per cm^3 of CdTe, I get 9 g required for 1 m^2. At 10% eff that's 90 metric tonnes for 1GW, very close to your number. Also, USGS confirms 128 tonnes produced in 2006. Also, run-up in price from $7 per pound in 2002 to $100 per pound is also confirmed by USGS:

      minerals.usgs.gov/mine...

      World reserves, locked up in copper, are 21,000 tonnes. Not economic to remove just to get the Te ... yet. This is a remarkably similar picture to the indium problem of CIGS. How much are we willing to pay for the Te in a m^2 of thin-film (100 W). FSLR wants total price to go down to $0.50 per Watt, or $50 per 100 W (1 m^2). So $10 for the Te is sane, or $1 per gram, or $500 per pound, only 5 times current price. If process can be 1 um instead of 3 um thick, we could look at $1500 a pound, 15 times your money. They are looking to produce 1 GW annually very soon, so this could be a very serious problem and speculative opportunity very quickly.....in 6 months. CIGS has a little longer to go before it has such a big problem. At 1 g / m^2 (30 tonnes per GW) and 500 tonnes/year currently produced, the problem is not as immediate...assuming LCDs stop drinking the stuff up for the ITO glare reduction (big assumption). But known world reserves are only 6,000 tonnes, locked up in zinc. Unlike Te and copper, it will become feasible to mine the zinc just to get the Indium. Short zinc if you believe in nanosolar. If the LCD market allows nanosolar to have 1/2 the known world reserves, that's enough for 100 GW peak, equal to Alabama's energy needs using 250 W average annual solar insolation.
      View article »
    • Fri Nov 9th 07:21 AM | Rating: 0 0
      Commented on:
      First Solar Q3 2007 Earnings Call Transcript
      i wonder if there will ever be a tellerium supply problem
      View article »
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