Canadian Solar Focuses on Efficiency

Canadian Solar Inc. (CSIQ - Analyst Report) recently signed a joint technology development and transfer contract to apply a metal wrap-through (MWT) cell technology to the production lines of the Energy Research Center of the Netherlands.

The agreement is in line with the company's plan to commercially launch a new cell structure in the fourth quarter. It expects this new cell structure to boost the conversion efficiency of its monocrystalline cells to 18.5% and multicrystalline cells to 16.8%.

Canadian Solar expects the MWT cell technology transfer to take about 6 months. The company will develop and manufacture the specialized module assembly equipment jointly with Eurotron. Eurotron is a Netherlands-based manufacturer and supplier of module assembly handling equipment.

Canadian Solar’s focus on upgrading conversion efficiency will make its solar modules more powerful. This will also improve the cost of modules that need lower quantum of cells. Higher-powered modules will give the company a distinct competitive advantage over its peers in solar projects. Lower manufacturing and installation costs will make PV systems more cost-effective for end customers.

Canadian Solar is a leading vertically integrated producer of ingots, wafers, solar cells, solar modules and other solar applications. Over the longer term, the company plans to extend the conversion efficiency of its cells to around 25% through the use of hetero-junction intrinsic thin-layer cells and tandem junction cells. We maintain our market Neutral recommendation on the shares.

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