Isra-Mart srl:REC signs new £120m solar wafer deal

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Isra-Mart srl news:

Norwegian solar wafer manufacturer Renewable Energy Corporation (REC) has forecast uncertainty for the solar market this year, despite signing a new contract worth NOK1.1bn (£120m) with an unnamed Asian photovoltaic cell producer.

The company yesterday announced it has entered into a new three-year deal to sell multicrystalline wafers to an Asian cell producer from today through to 2013.

Under the take-or-pay contract, REC will deliver wafers worth approximately NOK1.1bn based on prevailing market prices or receive a penalty if the buyer cancels the deal.

Speaking to BusinessGreen today, Mikkel Tørud, REC vice president and investor relations officer, refused to disclose the name of the buyer or the volume which will be delivered this year

However, he predicted the solar market is likely to remain uncertain during 2011 because of fluctuating feed-in-tariffs in various countries and "growth in supply, which could create [price] pressure on the market".

He added the company was "pleased" with its order book for 2011, predicting that the majority of deliveries in 2011 will come from existing customers through multi-wafer contracts.

REC received around €39m cash compensation last month after a separate customer terminated a long-term wafer sales contract, with a view to entering into a new contract for 2011.

Tørud said a new deal with that company is likely to be struck in the "near future" but not before the end of January.

In related news, Taiwanese solar cell maker Big Sun Energy Technology has reportedly agreed to buy $82.6m of silicon wafers from South Korea's Osung LST Co. through to 2013.