Evergreen Solar, Inc. (Nasdaq: ESLR) and Q-Cells AG today announced a partnership with Renewable Energy Corporation ASA (REC), based in Hovik, Norway. REC is joining EverQ, a strategic partnership between Evergreen Solar and Q-Cells, that is currently building a 30-megawatt solar wafer, cell and module manufacturing plant in Thalheim, Germany. In conjunction with becoming a stakeholder in EverQ, REC has agreed to the long-term supply of solar-grade silicon to Evergreen Solar and EverQ. Under terms of the seven-year agreement, REC will initially supply Evergreen Solar with 60 metric tons and EverQ with 190 metric tons of solar-grade silicon annually. Additionally, REC will license to EverQ certain of its proprietary manufacturing technology.
In exchange, REC will acquire a 15% ownership position in EverQ on a cost-of-capital basis. Following REC’s initial investment, Evergreen Solar will own 64% of EverQ, Q-Cells 21% and REC 15%. The agreements contemplate that when REC establishes planned additional facilities for the production of silicon, it will offer to EverQ a second long-term supply agreement that would substantially increase REC’s supply of silicon to EverQ. Should REC offer this second supply agreement, REC will be entitled to increase its ownership stake in EverQ to as much as one-third. The amended master agreement contemplates that Q-Cells will also be able to increase its ownership stake to one-third of EverQ.
"The addition of REC to the EverQ partnership is a landmark event for our joint venture and the entire solar industry," said Richard M. Feldt, President and Chief Executive Officer of Evergreen Solar. "At a time of potential silicon shortages and extremely high prices, EverQ now has an increased supply of silicon to facilitate rapid growth."
The 30-megawatt Thalheim facility is currently under construction and is scheduled to commence full-scale operations by the summer of 2006. The German government is providing EverQ with grants totaling approximately $34 million to offset manufacturing facility construction costs, which are anticipated to be $75 million. The plant is expected to create between 350 and 400 new solar jobs in the Saxony-Anhalt region. Based on the initial success of the facility, EverQ will then evaluate the possibility of expanding the facility from 30 megawatts up to 120 megawatts of capacity.
About Renewable Energy Corporation
Renewable Energy Corporation ASA (REC) was established in 1996 and produces polysilicon and wafers for PV applications. For further information on the company, please refer to www.recgroup.com.
About Q-Cells AG
Established in 1999, Q-Cells manufacturers solar and crystalline silicon cells. Its core business is the development, production and marketing of high-quality mono- and multicrystalline photovoltaic cells.
About Evergreen Solar, Inc.
Evergreen Solar, Inc. develops, manufactures and markets solar power products using the Company’s proprietary low-cost manufacturing technologies.
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