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The CIGS PV Value Proposition 
   

CIGS will most likely be the next thin-film photovoltaic technology to take off after cadmium
telluride (CdTe), said principal ana lyst and co-founder at NanoMarkets Lawrence Gasman, at a
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webinar hosted by NanoMarkets on January 13th. The value proposit ion be ing offered by
CIGS, Gasman goes on to say, is a ba lance between the advantages of both crystalline silicon
(c-Si), which gives relatively good efficiency, and thin-film PV technologies, which claim
potential advantages on cost, flexibility, weight, and manufacturability. However, CIGS is
"quite some way" from achieving this goa l, and therefore offers plenty of opportunity for
materials and equipment producers.

In the PV world, CIGS competes with c-Si, as well as several other thin-film technologies.
There are a few compound se miconductor technologies, including indium phosphide and
particularly gallium arsenide, which are targeted at specialized applications such as the
aerospace industry. And then there's c-Si, which is very wide ly used, but has the
disadvantages associated with its bulk and weight. In the thin-film area, there's organic PV
(includes dye sensitized ce lls), and nanomaterials, which right now are far out into the future.
The two technologies that have potential to take a growing share of the PV market in the near
term are CdTe and CIGS. The CdTe PV is doing very well, with First Solar cla iming 1-GW in
capacity.

So, where is CIGS today? At last count, there were about 20 firms working in the CIGS PV
area, with more than ten companies claiming commercial production in megawatt volumes by
the end of 2008. In terms of efficiency, CIGS has achieved the highest efficiency of any thin-
film PV technology—NREL has certified a 20.0 percent efficiency cha mpion cell created in their
lab. Although this falls be low the efficiency of c-Si solar cells, CIGS cells can be substantially
cheaper because of their reduced material usage and the ability to manufacture the m using
low-cost processes.

That being sa id, NanoMarkets' forecasts for CIGS PV over the next eight years are not only
based on CIGS performance but a lso on how NanoMarkets views the current and long term
economic environment. NanoMarkets expects a recessionary-deflationary economic
environment over the next year to 18 months followed by inflationary times. Over the next
year to 18 months, capacity for PV in general will increase by a considerable a mount, but this
capacity will be a lot less than might have once been thought. The credit crunch will ma ke it
harder for building owners to retrofit PV. And the issue of declining fossil energy costs will
make some PV projects that were attractive in 2008 look less attractive now.

Despite the current recession, NanoMarkets still sees opportunit ies for TFPV and CIGS PV in
particular. As ment ioned, NanoMarkets expects an inflationary period after a year to 18
months, which will resuscitate the old PV value proposition. Other favorable factors during this
time include: a need for price stability; and PV as a way of offsetting electric companies'
capital expenditures. And while construction is down, it's not dead. One market of particular
interest for TFPV and CIGS PV specifically is building integrated PV (BIPV).
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NanoMarkets expects CIGS' portion of the thin-film PV market to grow from 7.1 percent this
year, to 8.6 percent in 2011, followed by a further increase to 14.5 percent in 2015. In terms
of shipment values, CIGS will go from approximately $215 million in 2009, to $403 million in
2011, followed by about $1.7 billion in 2015. These forecasts assume the following: the
favorable policy environme nt will continue; worldwide production of PV will grow to 12
gigawatts (GW) by 2011, reaching 35 GW by 2015; and that there are no unexpected leaps Page | 2 
forward by non-CIGS PV technologies.

NanoMarkets believes that CIGS potential will only be met once the technology for
manufacturing this TFPV is stabilized. While the technologies for manufacturing c-Si and a-Si
are pretty well established (there's a certain a mount of proprietariness to the m but they're all
pretty similar), manufacturing material technology for CIGS really has yet to stabilize. CIGS
manufacturing technology is all over the place right now and ranges from Miasole doing
sputtering on glass, a fairly conventional se miconductor-type approach, through to Nanosolar
doing printing and then some pretty interesting and fairly out there stuff, such as HelioVolt's
proprietary "FASST" transfer printing technology.

There are three trends that NanoMarkets is seeing within the manufacturing of CIGS, which
are not necessarily mutually independent. These are: the use of fairly traditiona l deposit ion
technologies; using flexible substrates; and materials-oriented approaches. Traditional
deposition refers to mature manufacturing technologies, such as vacuum deposition, which is
most closely associated with best performance at the moment. This approach also lends itself
to economies of scale, which NanoMarkets believes is going to be increasingly important for
CIGS. Despite the fact that there are potentially better and cheaper ways of manufacturing
these modules, vacuum deposition is so well established and the performance is so attractive,
that NanoMarkets expects by 2016 about half of all CIGS PV modules will be manufactured in
this way.

The second manufacturing area centers on flexible substrates. This area is attractive because
it enables printing, as we ll as the ability to create novel products, such as those used in
building integrated PV (BIPV). While this is an attractive method, there are issues that need to
be resolved before this approach is a viable opt ion. For one, printing is typically done at low
temperatures—low-temperature operations tend to reduce processing costs but also create
lower performing PV cells. As we ll, the phenomenon achieved by coating on glass (i.e. glass
leaches out sodium, which helps to produce high-performance CIGS) is not experienced in
printing and roll-to-roll processing.

The third set of approaches focuses as much on new materials as it does on manufacturing
itself. These include electrodeposition and the use of nanoparticulate inks. At least one firm is
working on e lectrodeposition and several others are involved in the nanoparticulate ink
approach. While the printing technology with specialized inks is especially interesting because
it uses nanoparticulate inks, there are technical issues with imple mentation. In particular,
there is no evidence to date that the use of nanoparticles of CIGS provides the performance
achieved by bulk CIGS materia l. NanoMarkets has seen a breakdown in performance with
nanoparticle-based inks in other areas of thin-film PV such as a morphous silicon. This may be
the way of the future but is not what's happening right now, Gasman said.
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One area that deserves special attention is the area of substrates. The majority of CIGS
produced today rely on soda lime glass as the substrate, but other types of materials are
beginning to be used. Some companies have decided to use a conductor as the substrate; this
eliminates the need for a base electrode and thus reduces materials costs. However, this
approach precludes the use of monolithic integration—a series of ce lls are connected in
process, while the layers are applied, simply by scribing the films and stacks in appropriate Page | 3 
locations; this eliminates the separate steps to electrically connect the cells to form modules,
and can lead to significant manufacturing cost savings. There's a trade-off here, and it is
"iconic" of where we are today with CIGS PV. These trade-offs have yet to be resolved for
CIGS as they have been in other parts of the PV industry. Until they are resolved, the market
will not take off in a big way.

In conclusion, over the long-term future, NanoMarkets believes that CIGS is a leading
candidate for the future of PV. While it will not likely take over any time soon, CIGS' value
proposition—the high efficiencies of c-Si combined with the benefits associated with TFPV—
will likely take hold in the long run. In particular, NanoMarkets is betting on CIGS PV
technology for BIPV—an increasingly attractive way to install PV power.