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First Solar to Power Rural India

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First Solar Inc. (FSLR - Free Report) and Sir Ratan Tata Trust announced plans to collaborate on a pilot project to provide safe drinking water and irrigation to rural communities in India's northern Uttarakhand state.

Many remote villages of the middle Himalayas lack basic infrastructure such as roads, health facilities, schools and electricity. In Uttarakhand, even many villages that are connected to the electrical grid receive only erratic electrical service. In the absence of electric pumps, collecting water from spring sources and carrying it to villages - a job that usually falls to women - can take three to four hours a day.

Through its charitable giving program, First Solar has joined forces with the Sir Ratan Tata Trust to develop a pilot project using First Solar's advanced, thin-film photovoltaic (PV) modules to help off-grid villages in the region receive a reliable supply of clean energy for essential needs such as safe drinking water and irrigation. The aim of the pilot project is to develop an integrated solution that is low-maintenance and simple for the communities to install, maintain and use.

The pilot project, which will be managed under the Trust's Central Himalayan programme (Himmotthan Pariyojana) by the Himmotthan Society, will consist of two solar PV power plants which will be built in the Chureddhar and Chham (Gunogi) districts, Tehri Garhwal, Uttarakhand. If successful, the pilot project could be replicated across hundreds of villages throughout India.

The Sir Ratan Tata Trust is one of India's oldest philanthropic organisations. For more than a century, it has provided grants and partnered with organizations that engage in innovative and sustainable initiatives and have the potential to make a visible difference. Sir Ratan Tata Trust's programme in Uttarakhand has focused on providing rural communities in the region with affordable, long-term solutions for livelihood enhancement and resource management. This pilot would complement ongoing livelihood enhancement work by the Sir Ratan Tata Trust and field partners through community institutions.

First Solar will donate 100 modules to the pilot project, which will combine First Solar PV modules with water pumps to move water from spring sources into storage tanks in order to provide the village with a safe and convenient water supply. The project will benefit 65 households with a population of 530 individuals in the two villages.

First Solar is the only stand-alone solar player in the S&P 500 Index. Based in Phoenix, Arizona, the company designs, manufactures and sells solar electric power modules using a proprietary thin film semiconductor technology. The company's solar modules employ a thin layer of cadmium telluride semiconductor material to convert sunlight into electricity. It sells its products to project developers, system integrators, and operators of renewable energy projects, primarily in Europe with a distinct focus on Germany. First Solar also focuses on designing and deploying commercial solar projects for utilities.

Currently, the solar industry is experiencing a steep drop in Average Selling Prices. Also, the current macro scenario does not bode well for the solar industry, which thrives mainly on subsidies and grants. However, First Solar stands out among the pack due to its stable liquidity position, which is in sharp contrast to its cash-strapped peers. Moreover, in order to counter the weak trend, the company is focusing more on utility-scale electricity power projects. It is partially compensating for its drop in margins through a major restructuring of its operations.

First Solar presently retains a short-term Zacks #2 Rank (Buy) rating. Over the longer run we also maintain our long-term Neutral recommendation on the stock. This is in line with other solar peers like ReneSola Ltd. (SOL - Free Report) and Canadian Solar Inc. (CSIQ - Free Report) .

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