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Local Soitec chief Clark Crawford said the company has sought meetings with SDG&E for weeks in hopes of discussing the future of its contract.
“To date, they have declined to discuss the issues directly with us,” Crawford said in a statement. “If they continue to decline a meeting with us today we fear they may allow the power purchase agreements to just terminate.”
SDG&E, meanwhile, says it’s gone out of its way to accommodate Soitec and that the company’s statements about the status of its contract aren’t true.
“SDG&E does not have any contracts with Soitec,” utility spokeswoman Jennifer Ramp said.
It wasn’t supposed to be this way.
Soitec, one of the region’s only solar manufacturers, made national headlines in 2011 when it
opted to come to San Diego. The French company promised 450 local jobs and at least 200 megawatts of solar production a year.
Soitec’s arrival was supposed to be a shining example that large-scale manufacturing was possible in San Diego after all. State, local and national leaders lined up to make Soitec a success.
In the months following the 2011 announcement, the company received a
$25 million grant from the federal Department of Energy to expedite construction of its San Diego home and signed on for state enterprise zone tax incentives. The city put its permits on fast-forward.
All that help would ensure the company hit the ground running, Soitec said.
It also had the crucial SDG&E and Tenaska contracts.
“Our recent announcement worldwide shows that we have the perfect technology for the new wave of growth into solar markets,” Soitec CEO André-Jacques Auberton-Hervé said as the company’s Rancho Bernardo plant was
dedicated in December 2011.
All that has crumbled.
“The expectation that formed the basis of Soitec’s investment in California has not been realized,” Crawford said in a declaration submitted to the state Public Utilities Commission earlier this month, pleading with officials to force Tenaska to use Soitec products in its project.
Soitec has produced far fewer solar panels than initially laid out in its local power agreements.
Project cancellations and reductions have meant only about five megawatts’ worth of solar panels – enough to power thousands of homes – have been manufactured in San Diego, Crawford said in the document.
The company initially planned to produce 305 megawatts of solar panels in its SDG&E-tied projects alone.
Soitec is considered the world leader for
concentrated photovoltaics panels, or CPV panels, which are more efficient but require more sunlight than traditional solar equipment. They’re also more expensive, and are better suited for large-scale utility company projects than small rooftop installations.
CPV panels only made up
0.25 percent of the global market share for panels installed in 2014, according to industry news site GreenTech Media, which noted Soitec was one of only three companies “hanging on to any semblance of a functioning commercial enterprise.”
As Soitec was setting roots down in San Diego, other companies that made the niche solar panels were already floundering.
Scottsdale, Ariz.-based Stirling Energy Systems
filed for bankruptcy in September 2011. German company Solar Millennium filed for insolvency in December 2011. And Soitec competitor Amonix, based in Seal Beach, closed its Nevada plant in July 2012.
But SDG&E and Soitec proponents went all in for the company anyway.
The tradeoff would be great energy diversity for SDG&E, which was required to hit a
33 percent renewable energy target by 2020, and the 450 high-quality jobs.
Then Soitec’s plans to build four solar power plants in Boulevard hit repeated delays.
Tenaska opted not to use Soitec’s CPV panels in its project after all. The decision went public this April.
Tenaska said it parted ways with Soitec after the company couldn’t provide information sought by a Tenaska construction contractor to guarantee Soitec could deliver on the promises in the energy contract.
“The project schedule necessitated moving forward with a different engineering, procurement and construction contractor and a different technology,” said Delette Olberg, Tenaska’s vice president of government and public affairs.
The SDG&E agreements, held up as primary evidence of Soitec’s ability to flourish in California, also hit major hurdles.
An SDG&E spokeswoman said the company allowed an “unprecedented” 19 amendments to its five Soitec deals to help the company deliver on the promises in those contracts, including deadline extensions and location changes. (Soitec says it only pushed for two of those changes and that SDG&E is counting amendments applied to the company’s contracts multiple times.)
All those contracts eventually went to other groups.
First came the April announcement that Chicago-based Invenergy Solar Development would
take over Soitec’s Borrego Springs project. Then in October came the news that “one of the largest providers of solar energy services in North America” had bought out Soitec’s four remaining SDG&E agreements. The company never disclosed the name of that the buyer.
Soitec said that project would involve up to 83,400 solar modules produced at the company’s San Diego factory.
Auberton-Hervé, Soitec’s CEO, put a positive spin on the sale.
“This is an important milestone in executing Soitec’s strategic plan, as this agreement will provide significant demand to our U.S. solar manufacturing operation,” he said in a release.
Soitec now says that deal wasn’t consummated.
“The company that they were originally transferred to was unable to work through all of its major milestones and therefore the power purchase agreements were transferred back to Soitec this week,” Soitec spokeswoman Karen Hutchens said.
SDG&E maintains it doesn’t have any contracts with Soitec – a glaring disconnect between the two companies.
Soitec’s recent California Public Utilities Commission filing underscores the company’s struggles here.
Soitec invested more than $200 million in its San Diego factory, Soitec attorney Jerry Bloom wrote to the commission earlier this month. Bloom later claimed “the social and economic benefits” of the San Diego Soitec plant were negated by the loss of the Tenaska contract.
The situation for Soitec apparently only got worse after that Dec. 5 filing.
Mark Cafferty, CEO of the San Diego Regional Economic Development Corp., was one of Soitec’s early cheerleaders.
He acknowledged Friday he and others were excited about what clean technology could mean for California, and the possibility of attracting a manufacturing company to San Diego.
“Everybody was working very hard to make this happen. If we missed writing on the wall … it’s possible,” Cafferty said. “It’s a very entrepreneurial sector, a new sector and a changing sector. There are lots of companies that start and fail and others that hit home runs. Hopefully Soitec was going to be one of those companies.”
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