Honda Withdraws From Solar Cell Production

2013/10/31 18:05
Kenji Kaneko, Nikkei BP CleanTech Institute

Honda Motor Co Ltd announced Oct 30, 2013, that it will close the business of Honda Soltec Co Ltd, a wholly-owned subsidiary of Honda, which produces solar cell systems, and withdraw from the production and sales of solar cells.

Honda will close the business in the spring of 2014 and dissolve the subsidiary, which will stop accepting orders in mid-February 2014. Honda will continue to provide equivalent after-sales services for solar cell systems sold by the subsidiary. Honda Kaihatsu Co Ltd, which is affiliated with the Honda group, will accept requests for the services.

Honda Soltec was established in 2006. Since then, it has been engaged in the development and production of "CIGS solar cells," which are compound semiconductor solar cells. It invested about ¥7 billion (approx US$71 million) in its manufacturing plant in Kumamoto Prefecture, Japan, whose production capacity is about 30MW per year.

A CIGS solar cell is made by using a compound consisting of copper, indium, gallium and selenium to form a thin film on a glass substrate. Because it reacts with a variety of sunlight conditions, it has been considered as a solar cell that is less likely to be influenced by shadow, heat, weather, etc.

However, its maximum conversion efficiency is 13%, which is several points lower than the efficiencies of crystalline silicon solar cells, which are the mainstream.

Before the feed-in tariff (FIT) scheme was implemented in July 2012, Honda Soltec, with its Honda brand, had a certain presence in the market for solar panels to be installed on the roofs of residential houses. But in about 2011, solar panels manufactured by non-Japanese companies started to be imported to Japan, lowering the prices of solar panels and the price competitiveness of the company.

Solar Frontier K.K., which also manufactures compound semiconductor solar cells, invested about ¥100 billion in its manufacturing plant in Miyazaki Prefecture, Japan, established a production capacity of about 1,000MW per year and succeeded in volume production of panels with a conversion efficiency higher than 14%. Therefore, its compound semiconductor solar cells are now as competitive as crystalline silicon solar cells and have been employed for large-scale solar power plants one after the other.

Whether a company can have a competitive edge in the field of thin-film solar cells including amorphous silicon solar cells or not has been dependent on whether it can establish a volume production technology and keep cutting costs through volume production.

Sanyo Eneos Solar Co Ltd, a joint venture of JX Nippon Oil & Energy Corp and Sanyo Electric Co Ltd, which is affiliated with Panasonic Corp, was liquidated in 2012. And Mitsubishi Heavy Industries (MHI) Ltd drastically downsized its production facilities for amorphous silicon solar cells.