SunPower Corporation (Nasdaq: SPWR) has extended and expanded a major silicon supply agreement with a key supplier and partner, M.Setek Co., Ltd. M.Setek is a manufacturer of monocrystalline silicon ingots and wafers for the solar industry.
SunPower extended its existing agreement with M.Setek by two years, through 2010. The new agreement increases M.Setek’s 2008 silicon supply to SunPower while offering the potential for additional supply in 2007. The value of the agreement over its five-year term is estimated to exceed $500 million.
“SunPower is pleased to expand our relationship with M.Setek, one of our most valued partners,” said Tom Werner, CEO of SunPower. “The solar industry requires a reliable, high-volume silicon supply in order to maintain rapid growth. This agreement is a key element in SunPower’s silicon supply strategy.”
“We are happy to announce the extension of our agreement with SunPower,” said Ritsuo Matsumiya, M.Setek’s President. “We are always striving to strengthen our customer relationships. As we plan to grow our silicon ingot manufacturing and polysilicon refining capacity, we see SunPower as an attractive partner due to their technology advantages and strong business prospects.”
As previously announced, M.Setek is constructing its first polysilicon refinery, scheduled to begin operation in late 2007, to provide a guaranteed source of raw material for its ingot-puller manufacturing operation. Ingots are used to create silicon wafers-the starting material for SunPower’s high-efficiency solar cells.
“We believe that the solar industry’s rapid growth is currently limited by the supply of silicon,” continued Werner. “Because SunPower’s solar technology converts more sunlight to power than anyone else in the industry, we are also among the leaders in silicon utilization efficiency,” Werner said. “We credit our technological leadership for our success in developing long- term silicon supply partnerships such as our relationship with M.Setek. We particularly thank Mr. Matsumiya for his leadership in growing mutual opportunities for our companies.”
About SunPower
SunPower Corporation designs and manufactures high-efficiency silicon solar cells and solar panels based on an all-back contact cell design. SunPower is a majority-owned subsidiary of Cypress Semiconductor Corp. (NYSE: CY).
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