Taiwan Semiconductor Invests in US Thin-Film Solar Company

Stion, a U.S.-based manufacturer of high-efficiency thin-film solar panels, announced a production partnership with Taiwan Semiconductor Manufacturing Co. (TSMC)(NYSE: TSM).

TSMC is the world’s biggest chip maker. Through its affiliate VentureTech Alliance, it will invest US$50 million to take a 21% stake in Stion. 

Stion will license and transfer its thin-film CIGS technology to TSMC, and TSMC will provide a certain quantity of solar modules to Stion using the technology. The two companies will also work together to enhance the thin film technology through joint development.

The arrangement is part of a largeer $70 million Series D financing round for Stion. Stion will use the funds to begin a 100-MW expansion of its San Jose, Calif. facility. Stion had previously raised $44.6 million in equity financing.

TSMC has been looking to expand its presence in clean technology. Last year, it bought a 20% stake in solar cell company Motech.

“TSMC has evaluated a number of thin-film technologies and believes by working with Stion we will gain a robust thin film technology with inherent low cost structure,” said Mr. YC Chao, TSMC’s Senior Director of New Businesses.

Chet Farris, Stion’s President and CEO, added, “Beyond our 100 MW production facility, the strategic partnerships result in a very capital efficient production model as we will gain access to a certain amount of capacity without additional capital commitment from Stion.”

“In the crowded field of thin film solar with mostly undifferentiated technology, Stion has distinguished itself with the highest efficiency production ready technology on one square meter, 120 W to 130 W monolithic panels. Stion will show how a PV startup gets to positive cash flow with a $100m dollar equity investment,” said Vinod Khosla, Partner at Khosla Ventures.

Stion’s panels are specifically designed for use in all major applications. The panels are produced using monolithically integrated circuits and are said to offer a number of advantages over competing products, including high efficiency, a convenient form factor (2 ft. x 5 ft), improved performance in partial shading, and superb aesthetics.

As part of the expansion, Stion expects to bring more than 500 direct and indirect solar jobs to the region in 2010 and 2011.

Stion was founded in 2006 and is backed by venture capital investors, including Khosla Ventures, Lightspeed Venture Partners, General Catalyst Partners, and Braemar Energy Ventures.

Website: http://www.stion.com     
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