Study pegs energy-rich Trinidad and Tobago as ideal manufacturing locale for solar panels
According to a new feasibility study, a plan to co-locate four plants producing polysilicon, metallurgical silicon, float glass and solar photovoltaics (solar PV) in Trinidad and Tobago’s industrial mecca of Point Lisas will make the country a cheap location for large-scale manufacture of solar panels given its low energy costs, access to abundant raw materials and mature industrial supply chain.
With global energy demand expected to double over the next 20 years, Trinidad and Tobago can likely become a renewable energy source at or cheaper than the price of traditional energy and this merits a close look by potential investors, the year-long InvesTT-commissioned study reported. A private consortium produced the report. SiTek Limited, the local firm that came up with the idea, led the team which included German firm Viridis.IQ and The Float Glass Consortium from the UK.
While most Caribbean countries face some of the world’s highest energy costs, Trinidad and Tobago's readily available and low-cost energy supply has been a major factor in attracting new manufacturers to its shores.
The feasibility study’s ranking of global energy costs showed Trinidad’s industrial rate at US$0.03 per kWh, compared to US$0.06 in the U.S. and Peru, US$0.07 in Malaysia and Brazil, and above US$0.09 in China. These rates are supported by a 2013 ranking by the International Energy Agency. This is significant because electricity is a major cost component of these plants anywhere in the world.
China dominates the global solar PV panel market. Five companies control 51 percent of the world supply of photovoltaics, with four of those companies in China (Suntech, Yingli Solar, Trina Solar and Sungen Solar).
The solar cluster envisioned for Trinidad will produce polysilicon (PolySi), metallurgical silicon (MGSi), photovoltaics and float glass. The consortium identified Point Lisas as the proposed site because nearby petrochemical plants provide an extensive infrastructure and utilities grid that will benefit clean technology manufacturers.
More than that, the proximity of the Point Lisas port will facilitate a low-cost supply chain for new manufacturers.
These manufacturers will also have access to a large group of highly skilled technology workers and project managers from the petrochemical industry, bolstered by graduates from nearby universities.
The University of Trinidad and Tobago and the University of the West Indies offer bachelor’s and master’s degrees in chemical and process engineering. The two schools produce a combined 2,700-plus undergraduate, postgraduate and diploma students in engineering annually.
The National Energy Skills Centre (NESC), whose main campus is on Point Lisas, produces 4,200 technician- and craftsmen-level graduates per year. Other technology schools graduate an additional 1,200 trained workers for high-tech industries.
As a clean-tech destination, Trinidad and Tobago also scores well because of its access to the high-quality raw materials needed for clean energy products.
The feasibility study located multiple highly competitive suppliers for any raw materials that are not available locally, helping Pt. Lisas, Trinidad achieve top consideration for clean energy technology manufacturing.
For MGSi, woodchips, high-quality charcoal and high-purity lump quartz are available, and industrial gases needed for production will offer a cost savings.
PolySi plants will benefit substantially from the co-location of MGSi plants, as these will allow for more than 90 percent of their required raw materials to be locally sourced.
MGSi and PolySi plants will also benefit from access to local chemical engineering, steel and major project execution expertise.
In float glass production, Trinidad’s low gas prices have significantly reduced the cost of furnace fuel and the price of industrial gases.
Excellent low-iron sand, a rare commodity in solar PV manufacturing, can be obtained from operators identified in Guyana at competitive pricing, and the consortium has identified high-quality dolomite and limestone suppliers in Jamaica and North America.
A growing and largely untapped Caribbean base needing low-cost glass for a variety of uses is yet another opportunity. For Latin America and beyond, Trinidad and Tobago is a gateway to a market of more than 250 million people importing significant volumes of glass annually.
For all clean-energy technology manufacturers coming on board with the industrial solar park, government support will come in the form of specific incentives and cluster development initiatives customised for each manufacturer.
As the need for subsidy-driven markets has declined and new clean-energy technology markets have opened up worldwide, this industry is now positioned for steady growth. The average cost for tier-1 solar photovoltaic manufacturers is expected to fall 6 percent during 2014, bringing the overall cost to a record low of $0.20 per watt, according to NPD Solarbuzz’s research in their report Polysilicon and Wafer Supply Chain Quarterly.
Investors seeking new solar-PV locations are encouraged to act within the next year, and those in Polysilicon should take advantage of the projected expansion within the next two years.
Trinidad’s proposed park and many location advantages should prompt serious consideration for investors wanting to take advantage of these opportunities. InvesTT president Racquel Moses offered this take:
“Situating these plants within the photovoltaic value chain, combined with our price of energy and access to raw materials, creates economies of scale that surpass most of our potential competitors.
“Trinidad and Tobago can provide an extended market of more than 700 million people through bilateral trade agreements with Venezuela, Colombia, the Dominican Republic, Costa Rica, France, the USA, Canada, Cuba and Europe.”