Jun 18, 2014 - SolarCity Corp. agreed to pay $200 million in stock to acquire a maker of high-performance solar panels. It plans to build a factory that will have at least a gigawatt of annual production capacity.
"SolarCity is driving a boom in U.S. rooftop solar energy by leasing systems that carry little to no upfront costs. It has more than 110,000 customers and expects to install as much as 1GW this year, using panels it buys from other companies, mostly in China. The company sees annual demand eventually reaching 'tens of gigawatt' and needs more control over its supply chain", Musk said on a conference call yesterday.
"The crazy thing is that the gigawatt plant is almost like the pilot plant for what will come," he said. "If we don't do this, we thought there was risk of not being able to have the solar panels we need to expand the business."
"The move into manufacturing is aimed at reducing costs and ensuring a steady supply of panels", Musk said. The deal is expected to close in the third quarter. SolarCity may pay an additional $150 million if Silevo meets certain conditions, according to a filing with the Securities and Exchange Commission.
"The path to ultimately having solar power be way cheaper than coal or fracked-gas power is to combine huge economies of scale with the most advanced technology," Musk said. "This is getting closer to SolarCity being able to provide the bulk of the hardware."
It will take several years for the technology to end up in SolarCity's systems. "Silevo has a high-efficiency technology, but it's a startup, with no commercial production until 2015 or 2016," Molchanov said.