SolarCity plans to start making solar panels at its South Buffalo factory by the end of June next year – several months sooner than it had been expecting.
Company officials also now believe they can significantly increase the plant’s capacity beyond the 1 gigawatt originally planned.
Improvements in the equipment that the factory will use, combined with a more efficient layout within the plant, should allow the factory to make more solar panels than would have been possible under its original design, said Peter Rive, SolarCity’s chief technology officer.
“We’ve figured out ways where we can get the capacity up quite a bit higher than 1 gigawatt,” Rive said in an interview with The Buffalo News.
He declined to say how much of an increase in capacity the company believes it can achieve.
SolarCity initially had planned to start making solar panels at the Buffalo factory this year, but the company’s slower growth and financial constraints forced it to push some of the investments it needed to open the factory until next year, which delayed its timetable for beginning production until late 2017.
But SolarCity plans to start selling a roofing product that has solar panels built in, using the high-efficiency modules it will produce in Buffalo. The initial production at the Buffalo plant will center around the new integrated roofing-solar panel product.
The modules that SolarCity will make in Buffalo will be able to convert more of the sun’s energy into electricity – 22 percent vs. about 18 percent for conventional panels. So the company wants to incorporate those higher-efficiency modules into the design of its integrated roofing product. And because SolarCity hopes to start selling its new roofing product next year, it needs production at the Buffalo plant to come on earlier than planned.
“This is a product that we’re going to be kind of expediting module manufacturing for,” Rive said.
Under the new timetable, SolarCity plans to begin making solar panels in just a portion of the Riverbend factory, with roughly enough initial capacity to make 250 megawatts of solar panels, or about a quarter of the factory’s total stated capacity. Production then will ramp up through the rest of 2017 and likely hit full production sometime during 2018, Rive said.
Construction on the South Park Avenue factory, which is being built with $750 million in state incentives through the Buffalo Billion economic development initiative, is in its final stages. The factory, spanning 1.2 million square feet, is expected to be “substantially complete” within the next 30 to 45 days, said Kevin Schuler, a spokesman for the project’s main contractor, LPCiminelli. About 400 construction workers still are working on the site, down from a peak of more than 1,000 earlier this year.
While SolarCity eventually expects to employ about 500 people in solar panel manufacturing, the company initially will need 50 to 100 workers during the first few months of 2017 to begin the preliminary work on setting up its manufacturing systems and installing and testing the equipment, Rive said.
Once production begins at its reduced level, using photovoltaic cells that SolarCity will purchase from other vendors, the factory probably will need another 50 to 100 manufacturing workers, he said.
SolarCity also is looking at ways to change the layout of the Buffalo factory and modify some of the equipment used to make the solar panels in order to “significantly improve” the capacity of the plant.
As SolarCity executives and engineers have studied those potential changes, the company has held off on ordering some of the plant’s equipment or starting to install other equipment until it has finalized its plan for the factory’s layout and design.
“I’d describe it more as optimization,” Rive said. “With every tool, we try to figure out how we can get more output through each tool.”
The solar panel production process is expected to be highly automated, with much of the responsibility of the factory’s workers focused on maintaining and repairing the plant’s equipment, he said.
The factory originally was projected to have the capacity to produce about 9,000 solar panels each day, which would be roughly sufficient to cover SolarCity’s demand for solar panels this year. Under the original plan, once the Buffalo factory reaches full production, the panels it makes would have the capacity to generate as much as 1,000 megawatts of electricity. That’s slightly less than the roughly 950 megawatts of solar generating capacity that SolarCity expects to install this year under its recently reduced installation forecast.
Squeezing more output from the Buffalo factory could allow it to meet more of SolarCity’s panel requirements, while also slightly delaying the company’s need to open another plant should demand grow to the point where it outstrips the capacity of the Riverbend facility. Revising the factory’s layout and machinery to optimize its output also would help extend the useful life of the Buffalo facility.
“What’s really important for us in the factory is that it’s competitive for years to come,” Rive said during a conference call after SolarCity reported that its second-quarter loss doubled. “We don’t have to rush to actually initiate some of the equipment installation.”
The proposed $2.6 billion acquisition of SolarCity by electric vehicle and battery maker Tesla Motors also is a factor in SolarCity’s methodical approach to buying equipment and finalizing the layout of the Buffalo factory. Elon Musk, who owns more than 20 percent of the stock in each company, is SolarCity’s chairman and the CEO of Tesla.
“With the pending Tesla acquisition, we believe it prudent to wait for a couple of months for the transaction to close so that we can get the benefit of their manufacturing expertise, said Kady Cooper, a SolarCity spokeswoman.