$18m venture thrusts Emcore into solar systems
In a strategic move that will guarantee a lucrative, exclusive customer supply deal for its solar cell division, III-V device maker Emcore is to invest $18 million in WorldWater and Power Corp.
Based in Pennington, NJ, WorldWater specializes in solar-powered water pump technology. Emcore has already invested $13.5 million, and expects to supply the $4.5 million balance before the end of this year.
That will give Emcore a 31 percent equity share in WorldWater, while a separate supply agreement means that Emcore will be its exclusive supplier of high-efficiency multi-junction solar cells, assemblies and concentrator subsystems.
Emcore has valued that contract to be worth "up to" $100 million over the next three years, a figure that ought to deliver a massive boost to Emcore s photovoltaics business unit.
Investors appeared to be keen on the development, with shares in Emcore spiking up more than 15 per cent to nearly $6.50 following the announcement.
As Emcore CEO Reuben Richards noted, the investment marks an important shift in the company s strategy within the terrestrial solar energy market. "[Emcore] is becoming, with WorldWater, a solution provider rather than just a component supplier."
This movement up the industry food chain has been a feature of Emcore s wider strategy over the past few years, ever since it sold its MOCVD equipment division to Veeco Instruments in 2003.
Since then, Emcore has sold its RF electronic materials division to epiwafer foundry IQE, and its half-share in LED joint venture Gelcore to General Electric.
Via the WorldWater supply deal, Emcore solar cells based on GaAs alloys and germanium substrates will be hooked up to specialized electrical drives that are used to pump water for utility companies and to irrigate farmland.
Richards pointed out that a significant percentage of the world s electrical consumption is used to run pumps and motors, and sees this as part of a rapidly expanding opportunity for solar energy systems to replace or augment grid electricity.
WorldWater has already begun to make an impact in this area, and its annual sales are expected to grow almost ten-fold from $2 million in 2005 to nearly $17 million this year.
WorldWater founder Quentin Kelly, who started up the company as long ago as 1984 to supply water and power to developing nations, said of the deal, "Concentrated photovoltaic systems are the keys to reducing the cost per watt of power generated."
"This major financing will enable [us] to increase our core business of blending and/or replacing the electric grid with solar power"¦whether in the agricultural, water utility or other industrial fields."