Back to top

FSLR to Build Solar Plant in Dubai

Read MoreHide Full Article

First Solar, Inc. (FSLR - Free Report) has been chosen to build a 13 megawatt ("MWDC") solar photovoltaic (“PV”) power plant in Seih Al Dahal by the Dubai Electricity & Water Authority (DEWA).  The company will not only provide advanced thin-film PV modules but will also offer engineering, procurement and construction services.

Located approximately 50 kilometers south of Dubai, the Arab Emirates Dirham’s (“AED”) 12 billion project is spread over an area of 48 square kilometers. On an average, the power plant has the capacity to generate more than 22 million kilowatt hours of electricity annually, which is sufficient to meet the average annual electricity requirement of more than 500 homes. Being eco friendly, the electricity generated by the plant will be approximately equal to eradicate 1,600 cars from the road per year. With the optimum use of both PV and solar thermal technology, the plant will displace more than 14,000 metric tons of CO2 per annum. The project will eventually help Dubai to get 5% of its electricity from renewable sources by 2030.

First Solar is engaged in helping the states to meet their standard goals of producing clean energy in a specified time period either by constructing solar power plants or supplying solar power modules. Recently, in October 2012, the company had signed a memorandum of understanding (“MOU”) with PT. Pembangkitan Jawa Bali Services (PJB Services) of Indonesia for the development, engineering, procurement, construction, operation and maintenance of approximately 100 MW pipeline for solar PV power plants in Indonesia. This also includes PV hybrid solutions, using First Solar's advanced thin-film PV modules and related system services and components.

In September, the company entered into an agreement to construct four solar power plants with a total generating capacity of 20 megawatts (“MW”) AC for PNM Resources, Inc. First Solar also inked a deal with Kiran Energy Solar Power Pvt. Ltd. and Mahindra Solar One Pvt. Ltd. to supply advanced, thin-film solar modules for two solar PV power plants in India's Rajasthan state with a total generation capacity of 50 MW.

Like First Solar, one of its peers, Suntech Power Holdings Co. Ltd. in collaboration with Bangchak recently brought South East Asia's largest silicon PV 44 MW power plant online. The project, known as Sunny Bangchak, is located in Bang Pa-In, Ayutthaya, which is forty kilometers away from Bangkok, Thailand.

Apart from minimizing the need to import about 40,000 tons of coal, the plant will offset 32,000 tons of CO2 emissions, which is almost equal to removing 9,000 cars from the roads or planting of 3,000,000 trees. The project will help Thailand to meet 20% of its total energy consumption with renewable sources by 2022.

First Solar is a leading global provider of comprehensive PV solar systems, which use its advanced thin-film modules. The company's integrated power plant solutions deliver an economically attractive alternative to fossil-fuel electricity generation today.

First Solar is engaged in designing and manufacturing solar modules using a proprietary thin-film-semiconductor technology that allows it to reduce its average solar module manufacturing costs to one of the lowest in the world. The company, however, is currently witnessing a steep drop in Average Selling Prices like its peers. Also, the current macro scenario does not bode well for the solar industry, which thrives mainly on subsidies and grants.

In order to counter the weak trend, the company is focusing more on utility-scale electricity power projects. Moreover, First Solar is partially compensating for its drop in margins through a major restructuring of its operations that it had begun in April. The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

First Solar, Inc. (FSLR) - free report >>

More from Zacks Analyst Blog

You May Like