Elon Musk’s SolarCity has acquired Silevo

SolarCity, the dominant US installer of residential solar panels whose largest shareholder is entrepreneur Elon Musk, announced Tuesday that it plans to acquire solar panel maker Silevo and expand into manufacturing with new panel factories. The San Mateo-based company, which leases rooftop systems with little to zero upfront costs, said the acquisition enables it to produce efficient, low-cost panels in volumes large enough to ensure its supply. It’s in talks with the state of New York to build, within two years there, one of the world’s largest solar panel factories with an annual capacity of at least one gigawatt. “If we don’t do this, we thought there was a risk of not being able to have the solar panels we need to expand our business in the long-term,” chairman Elon Musk, also CEO of Tesla Motors, said Tuesday in a conference call. He said while many basic panels are being made, more advanced ones are needed for the solar industry to lower its costs and compete with other energy sources without government subsidies.

SolarCity Corp. agreed to acquire Silevo, a maker of high-efficiency solar modules, a move that the U.S. solar-panel installer expects will enable a breakthrough in the cost of solar power. Based in Fremont, Calif., closely held Silevo has developed solar-cell technology with high efficiency at a low cost, SolarCity said. Peter Rive, SolarCity’s chief technology officer, compared Silevo’s panels to “buying a BMW at a Ford price.” With the purchase of Silevo, SolarCity will become a manufacturer of solar modules, an industry dominated by Chinese companies and China-based manufacturers. In fact, Silevo’s current manufacturing facility is based in China, but the company was developing plans for a Buffalo, N.Y., solar-module factory. SolarCity aims to take that Buffalo plan and expand on it. With the acquisition of Silevo, SolarCity said it wants to build a solar-panel module plant in Buffalo that would triple the size of the largest solar plant in the U.S. and compete head-to-head with Chinese manufacturers. Raymond James analysts estimate the Buffalo facility will cost between $350 million and $400 million to build, but SolarCity declined to present a price tag. Elon Musk, SolarCity’s chairman who is also chief executive of Tesla Motors, said the goal is to produce solar panels capable of generating power “cheaper than coal or fracked gas power.”