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$150m loan lets solar firm think big

By Taryn Luna
Globe Correspondent / June 17, 2011

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A Lexington maker of solar cells is expected to receive a $150 million loan from the Energy Department to commercialize a technology that significantly cuts the cost of silicon wafers used in solar panels and could boost the country’s share of the global solar energy market.

The company, 1366 Technologies Inc., would use the loan to build a factory, with construction scheduled to begin in 2013 and production commencing the next year.

The company’s manufacturing process, known as Direct Wafer, streamlines the production of silicon wafers, condensing the four steps in current solar cell manufacturing to one.

1366’s technology, which reduces silicon waste, cuts the cost of the wafers by as much as two-thirds, company officials said. The cost of a 6-by-6-inch wafer, for example, would fall to $1 from $3, they predicted.

At such a cost, said chief executive Frank van Mierlo, “You’re generating solar electricity at the same price that you are currently generating electricity at coal plants.’’ Coal is among the least costly fossil fuels, but it is also considered the dirtiest.

The company and energy officials said the Direct Wafer system could allow the United States to compete better with China and other low-cost producers and increase the US share of the wafer market, which is only about 3 percent.

The nation could potentially turn $2 billion in exports of silicon a year into $7 billion in exports of finished silicon wafers, van Mierlo said.

The company’s process, developed at the Massachusetts Institute of Technology, was initially funded by $7 million in grants from the Energy Department.

Such loans are designed to help innovative companies overcome the so-called Valley of Death, the period between demonstrations of new technologies and their commercialization.

“Conventional banks will line up to be the first to finance your second project,’’ said Matthew Winters, a senior adviser at the Department of Energy. “But it is that first commercial scaling of innovation technology that companies struggle to find financing for.’’

The loan needs final approval by Sept. 30. Company officials expect to meet that deadline.

The Department of Energy has committed more than $12 billion in financing for 16 solar projects and $14 billion in loan guarantees for 26 clean energy projects since 2009.

T aryn Luna can be reached at tluna@globe.com.