1. 1 Katsumi Kushiya Showa Shell Sekiyu K.K. Solar Frontier K.K. The University of Tokyo Industry–Academia Collaboration Towards Sustainability on the case of Solar-PV Technology Sustainability Science Workshop, UN Headquarters, New York, October 5, 2010

2. 2 Outline (1)Who is Showa Shell Sekiyu K.K. & Solar Frontier K.K. (2)Successful results of Collaboration between Industry and Academia on the R&D of Solar-PV Technology (3)International survival race on Solar- PV or Sustainable Growth of Solar-PV

3. 3 Showa Shell Sekiyu K.K. Solar Frontier Americas, Inc. 100% Subsidiary, Solar-PV business: mfg & marketing Parent Company Downstream oil business: refining & marketing Basic Data FY 2009 - US$ Listed in Tokyo Stock Exchange Class 1 Turnover: $21.6 B Total Assets: $12.5 B Market Cap: $ 3 B ※ Currency: $1 =\93.6 ※ Stock price = \756 Showa Shell Sekiyu Group Saudi Aramco 15% 35% 50% Solar Frontier Europe, GmbH Royal Dutch Shell General Share- holders 100% Solar Frontier K.K.

4. 4 4 X-Si a-Si CIS Overseas (Shell) Japan (Solar Frontier) 2006 2005 Decision made on commercial production of CIS Siemens Solar acquired Arco Solar Foundation of Shell Renewable Foundation of Shell Solar Shell Solar sold crystalline PV business to SolarWorld Focus on CIS R&D, launched JV with Sant-Gobain 1993 Started the R&D of CIS funded by NEDO 2004 Shell Solar Japan established 2006 Showa Shell Solar established 2007 Commercial production in Miyazaki Plant 1 2009 Production at 2 nd plant started, expanded capacity to 80MW/year &Atsugi Research Centre opened 2008 Shell sold share of Avancis to Saint-Gobain August 2009 2011 Launching world’s largestmass production plant, total1GW Scale 1978 Showa Shell started R&D work on PV 1981 Technical partnership with ARCO Solar 1983 Started X-Si module assembling (MODCO) 1986 Launched Showa ARCO Solar JV with ARCO Solar 1990 Showa ARCO Solar re-launched as Showa Solar Energy 1992 Installed PV for the first residential application Oil crisis 1987 Showa Shell & Kyocera co-founded JPEA (Japan Photovoltaic Energy Association) 1970 1990 2003 Shell Solar acquired Siemens Solar 1997 ARCO Solar started research on PV 1974, 1978 30-year Experience in the Solar-PV 2010 New Worldwide Name Solar Frontier R&D activities 2009 The JV, Avancis completed a 20MW CIS production facility

5. 5 Solar Frontier K.K., Today R&D - key technology development: world record of 16.3 % efficiency was achieved in the NEDO R&D Program. 2007, First Plant 20 MW/year capacity land =25,000 m 2 Bldg =6,000 m 2 Capex=USD 50M 2009, Second Plant 60 MW/year capacity Land=50,000 m 2 Building=27,000 m 2 Capex= USD 150M (JPY 15 Billion) 2009, Atsugi Research Centre : Next gen. production technology the three key processes enlarged substrate size, higher throughput, higher efficiency. 2011, Third plant will start commercial production 900 MW/year capacity land =400,000 m 2 bldg =190,000 m 2

6. 6 Outline (1)Who is Showa Shell Sekiyu K.K. & Solar Frontier K.K. (2)Successful results of Collaboration between Industry and Academia on the R&D of Solar-PV Technology (3)International survival race on Solar- PV or Sustainable Growth of Solar-PV

7. 7 R&D of Solar-PV National R&D program of Solar-PV was started. Oil Crisis 19731979 19751980 USAJapan 1990 EU This is a good example of collaboration between industry and academia. Technology Development + Market-pull strategy: Incentive, Subsidy Technology Development + Market-pull strategy: Feed in Tariff

8. 8 Solar-PV Cells Appearance Single Crystalline Si: From Space to Terrestrial Polycrystalline Si Amorphous Si （ film) Amorphous Si/ micro- crystalline Si (Tandem) CIS

9. 9 History of R&D of Solar-PV in Japan : NEDO R&D Programs Sunshine Program => Commercialization of Sharp, Kyocera Sunshine and New Sunshine (1st Phase) Programs => Commercialization of Fuji Electric, Sanyo Electric, Kaneka, MHI, Sharp (& First Solar) New Sunshine (2nd Phase) Program, Advanced PV Technology Program and Future PV Technology Program => Commercialization of Showa Shell Sekiyu, Kaneka, MHI Innovative Next Generation PV Technology Program and Future PV Technology Program 1st Generation PV Crystalline-Si PV: Single Crystal Si to Polycrystalline Si Power source in the Space to Terrestrial Power Application 2nd Generation Thin-film PV: CIS, Amorphous Si/ Microcrystalline-Si Tandem Higher performance than 1st Generation Thin-film PV 3rd Generation Thin-film PV: Organic Thin-film PV (DSC and Organic) 1st Generation Thin-film PV: Amorphous Si, CdTe After 2005, holding the market share in the European market, especially in Germany.

10. 10 From Simple to Complex Si Epitaxial film: (In,Ga)As Alloy System Polycrystalline thin film: Cu(In,Ga)(Se,S) 2 (Chalcopyrite Alloy) I-III-VI 2 Alloy: Group I= Cu, Group III= In and Ga, Group VI = Se and S IV III-V I-III-VI 2 II-VI Polycrystalline thin film: CdTe

11. 11 Never Ending Goal of R&D 1st Generation PV: Crystalline-Si PV: Single Crystal Si to Polycrystalline Si Power source in the Space to Terrestrial Power Application 2nd Generation Thin-film PV: CIS, Amorphous Si/Microcrystalline-Si Tandem Higher performance than 1st Generation Thin-film PV 3rd Generation Thin-film PV: Organic Thin-film PV (DSC and Organic) 1st Generation Thin-film PV: Amorphous Si, CdTe After 2005, holding the market share in the European market, especially in Germany. Cost reduction Grid parity

12. 12 Best Research-Cell Efficiencies from 1975 to 2004, prepared by NREL III-V: Over 40% CIS: Over20%

13. 13 Technology Transfer for Commercialization: CIS Solar cells R&D Transition Commercialization NREL ==> Global Solar Energy (Solon), Miasole, Nanosolar, Stion, and more Johannesburg Univ. ==> Johanna Solar (Bosch Solar CISTech) Stuttgart Univ. ==> ZSW ==> Würth Solar [ARCO Solar] ==>[Siemens Solar Ind.]==>[Shell Solar GmbH] ==> AVANCIS Hahn Meitner Institute (Helmholtz-Zentrum Berlin für Materialien und Energie) ==> Sulfurcell Showa Shell Sekiyu ==> Solar Frontier Honda Engineering ==> Honda Soltec Uppsala Univ. ==> Solibro AG ==> Solibro (Q-Cells)

14. 14 Role of industry and academia -Academia: demonstrate the potential of the materials excellence on a small-area solar cell. -Industry: improve the global competitiveness on a product. 20 % Cell efficiency demonstrated by NREL (20.0 %, 2008) and ZSW (20.3 %, 2010). 16 % Module efficiency race. Solar frontier is the top runner.

15. 15 Collaboration between industry and academia R&D Transition Commercialization Contribution Factor of Academia Happy time Business

16. 16 Outline (1)Who is Showa Shell Sekiyu K.K. & Solar Frontier K.K. (2)Successful results of Collaboration between Industry and Academia on the R&D of Solar-PV Technology (3)International survival race on Solar- PV or Sustainable Growth of Solar-PV

17. 17 Solar-PV System 1:PV array 2:PV array combiner/Junction box 3:Grid-tied inverter 4:Import/Export meter 5:Connection to the grid 6:Load How a grid-connected PV system works (Source: EPIA “Solar Generation V -2008”, p.19)

18. 18 Related Industries in Solar-PV Solar-PV Makers Parts related to the Solar-PV systems: Battery, Power conditioner, Rack and related goods, Electrical wire/Cables, Distribution panel, Switchboard, Meters, Displays Raw materials and module parts suppliers Equipment makers Related companies of Equipment maintenance, Industrial waste disposal, Analytical works Organization for IEC Certification: JET (J), TÜV (G), UL (USA), Organization for ISO PV system integrator & installer of House builders, Building firms, Electrical appliance stores, Large-scale shopping center (SC) Utility companies Authorities for license and approval: Local government (Application and notification), Fire authorities, Agency for High-pressure gas law, Keeping various laws and rules Educational institutions to bring up the people with special talent or skills Distribution networks, Storage/Warehouse

19. 19 Industrialization of Solar-PV So far, two successful ideas Basic ideaName of the System Remarks Market- pull Feed-in Tariff High level of customer satisfaction, because Solar-PV system owners are profitable. Incentive Sustainable? Green Certification Can Solar-PV system owners sell their amount of CO 2 emission? RPS Only for the industry Tax Incentive “Tax Heaven“ Policy Effective to invite the Solar-PV manufacturers who look for a location to set up their plants.

20. 20 Approaches for Industrialization  Feed-in-Tariff System = good for Developed countries: Germany, Spain, other EU countries, the USA and Japan  “Tax Heaven” Policy = good for Developing countries: Malaysia, one of Oil-producing countries and High population having a high level of education (  Strength of Asian countries). Companies decided to construct the mfg plant in Malaysia = First Solar, Q-cells, SunPower and Tokuyama  “Development of Environmentally-Friendly City” = good for Oil-producing countries; Masdar City (Abu Dhabi), KACST (Kingdom of Saudi Arabia) Development of wide range of infrastructure

21. 21 Impact of Feed in Tariff Source: Table 2 Cumulative installed PV power (MW) in IEA PVPS Countries Historical Perspective of Trends in Photovoltaic Applications Survey Report of selected IEA countries between 1992 and 2007 ◆ Incentive (Financial support) was finished in Japan. ◆ Revised Feed-in-Tariff was effective in Germany. Cumulative Installed PV Power [MW]

22. 22 New industry & Job Creation: In Germany, exclusively PV-system related companies were created, such as PV dealer/ distributor, PV-system installer/ integrator (i.e. downstream business sectors) because Feed-in- tariff system is a market-pull policy. However, too rapid growth of the German PV market was the main reason of the delay to create the upstream business sectors of Solar-PV business, i.e. mfg companies in Germany. Therefore, the German PV market had to import the PV products from the world to keep its growth rate. Solar-PV related companies in Germany after FIT system

23. 23 What Feed in Tariff changed PV Company 2004 [%] World Total Prod., 1.19 GW PV Company 2007 [%] World Total Prod., 3.73 GW PV Company 2009 [%] World Total Prod., 10.66 GW Sharp27.1Q-Cells10.4 First Solar9.5 Kyocera8.8Sharp9.7 Suntech6.6 Q-Cells (Germany) 6.3 Suntech (China) 8.8 Sharp5.6 Mitsubishi Electric 6.3Kyocera5.5Q-Cells5.0 Sanyo5.4 First Solar (CdTe, USA) 5.5 Yingli (China) 4.9 BP Solar (Australia) 4.4 Motech (Taiwan) 5.3 JA Solar (China) 4.8 Schott Solar (Germany) 4.4Sanyo4.4Kyocera3.8

24. 24 Solar-PV: Two Categories Two concepts for the technology development System Design Installation & Sales Cz or Casting Moduling Solar Cell Processing SEG-Si 11 Nine SOG-Si Up to 8 Nine Slicing Wafering Crystalline-Si Solar Cells & PV Modules Packaging Circuit Manufacturing Thin-film Solar Cells & PV Modules Raw materials Separated or batch Focused on Solar cell processing Different players Integrated Less players Turn-key makers Venture capital Many start ups

25. 25 Expansion of Production Volume in First Solar (CdTe)  First Solar announced that 1) They started the production in the beginning of 2002 and reached the accumulated production volume of 1 GW (1000MW) in march, 2009. 2) It took for 6 years to reach the first 500 MW, but only for 6 months to achieve the next 500 MW. 3) In 2009, they will produce 1 GW per year. In 2009, 23 production lines and 4000 employees

26. 26 From Raw Materials to Waste (Control of product Life Cycle) Mfg Sales and Service Materials Recycle, Recovery of valuables Future subject ? Selection of Raw Materials Long-life product Basic device-design concept: １） Achieve high performance for the grid parity. ２） Meet the RoHS Directives containing neither Cd nor Pb. ３） Mfg capacity over GW Basic device-design concept: １） Achieve high performance for the grid parity. ２） Meet the RoHS Directives containing neither Cd nor Pb. ３） Mfg capacity over GW Quality Assurance Meet the IEC systems and the ISO. Minimize the waste Prepare the Materials cycling society Complete the Life cycle control. http://www.pvcycle.org/index.php?id=3