REC Shuts Down PV Manufacturing Plants Following Tough Third Quarter

Renewable Energy Corp. ASA (REC) has voted to permanently shut down several of its manufacturing facilities in Norway: its oldest PV wafer plants at Heroya (500 MW capacity), wafer multi-plant in Glomfjord (275 MW capacity) and solar cell plant in Narvik (180 MW capacity). A staff of approximately 700 will be affected.

The news comes as REC reports third-quarter 2011 revenues of NOK3,001 million and earnings before interest, taxes, depreciation, and amortization of NOK370 million. The operating result was negatively affected by a weak solar market and curtailment of parts of the production capacity in Norway, the company says.

Because of reduced prices on solar modules and other components, investments in PV systems are currently yielding favorable end-user returns in a number of markets. However, macroeconomic uncertainties and reduced availability of financing have limited demand growth, and industry overcapacity has led to further price pressure throughout the solar value chain in the third quarter, REC adds.

The company's third-quarter revenues were down 12% from the previous quarter, due to reduced sales prices and lower volume. Compared to the previous quarter, average selling prices for polysilicon were down 8%, wafer prices were down 17% and module prices were down 13%.


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