In Depth: What would the Sun King make of Saint-Gobain?
Old dogs may be incapable of learning new tricks, but old companies do not have that luxury.
France’s Saint-Gobain knows this because it has been learning new tricks for more than 350 years — and its latest is solar energy.
Saint-Gobain was founded as a mirror maker during the reign of Louis XIV — the Sun King — with the intention of weaning France off imported Venetian mirrors.
Today, it is among Europe’s biggest industrial companies and one of the world’s largest, most innovative producers of construction materials, chalking up revenues in excess of €40bn ($57bn) last year.
Having weathered political and economic convulsions over the centuries, the company senses that a revolution is about to take place in the construction sector, underpinned by a sharp turn towards energy efficiency and carbon neutrality.
“We believe the building and construction sectors will combine with solar energy pretty quickly in the coming years,” says Guillerme Huguen, managing director of Saint-Gobain Solar Systems.
“That trend ties in with Saint-Gobain’s long-term strategy to focus increasingly on high-value construction projects. Solar is a nice fit for us.”
Saint-Gobain’s first foray into the PV sector came when it diversified its flat-glass division — whose panels have been used in London’s “ Gherkin” building, the Grand Canyon SkyWalk and other iconic projects — into supplying sheet glass for PV modules.
Since then, the company has aggressively expanded its PV product range to include everything from electrical equipment for installers to films and foams used inside modules. In a modern twist on its origins, it also offers parabolic-trough mirrors to the solar-thermal sector.
More recently, Saint-Gobain has built up a systems integration business in Western Europe, designing, manufacturing and installing PV kit for commercial and residential customers.
In 2006, it took the unusual step of linking up with Shell Solar to form thin-film module maker Avancis.
Avancis’ copper indium gallium selenide (CIGS) technology traces its history to California in the early 1980s.
Saint-Gobain and Shell built the first 20MW Avancis factory in Saxony, in the heart of Germany’s solar industry. The first modules rolled off the line in 2008, the same year the French company formally folded its disparate PV activities into Saint-Gobain Solar.
The following year, Saint-Gobain bought out Shell’s stake in Avancis, leaving it the sole owner of one of the highest-profile CIGS manufacturers.
Sceptics point out that with a limited number of CIGS players, there is scant understanding or acceptance of the technology in the marketplace. Huguen acknowledges that CIGS is less well known than some other PV technologies, but believes that will change naturally over the next few years as manufacturers scale up.
“Those concerns are fully justified,” he says. “There’s no denying it’s a new technology and needs to prove itself competitive not only on cost, but also functionality.
“We need to put more effort into convincing the market that this is the right technology, which is why, from September, we’re going to start dedicating more time, more resources and more of our marketing budget to CIGS.
“We have one core argument for CIGS: we strongly feel that it will be the long-term winner in overall manufacturing costs.”
The company aims to hammer down Avancis’ production costs to €0.60 per watt within a few years.
The other great challenge facing CIGS — and, by extension, Avancis — is scale. With several crystalline silicon producers having crossed the 1GW mark, Saint-Gobain knows it must expand its manufacturing footprint rapidly.
By the end of 2011, it will have brought a further 100MW of capacity on line in Germany, and late last year it announced plans to jointly build another 100MW plant in South Korea alongside Hyundai Heavy Industries. The facility, which will produce modules for both companies, will be fully operational by early 2013.
And that is only the beginning for Avancis. Huguen hints that several other factories are being considered: “We’re very clear that we don’t want to stick to 220MW. We intend to grow pretty quickly, with a long-run target of close to 1GW.”