NanoMarkets. Markets for Indium-Based Materials in Photovoltaics Nano-405. Published September NanoMarkets, LC

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1 Markets for Indium-Based Materials in Photovoltaics Nano-405 Published September 2011 NanoMarkets, LC NanoMarkets, LC PO Box 3840 Glen Allen, VA Tel: Web:

2 Chapter One: Introduction 1.1 Background to this Report Despite relatively adverse conditions, the photovoltaics (PV) industry continues to grow at a rapid rate. This yields opportunities not just for the companies that make the actual solar cells and modules, but for materials firms as well. In particular, we believe that the growth of the PV industry opens up opportunities for the indium industry, primarily as the result of increased ITO usage and through the emergence of CIGS PV, but also to a minor extent through the use of indium in PV based on indium phosphide. Another minor evolving market is where indium can substitute for cadmium in PV. The indium market is already dominated by a single product, indium tin oxide (ITO), which accounts for well over 80 percent of all indium consumed. ITO is the main transparent conductor used by the display industry. The PV industry also consumes some of that ITO, although most of the PV industry makes do with other transparent conducting oxides (TCOs) or, in the case of PV based on crystalline silicon, uses a silver grid instead of a transparent conducting oxide for a front electrode. Despite the limited use of indium in transparent conductors for the PV industry, NanoMarkets believes that PV will be the fastest-growing significant application for indium over the next eight years at least CIGS (and InP PV) as a Driver for Indium Usage The main reason for this optimism is the expected rise of CIGS photovoltaics. Indium is critical to CIGS PV because it is a major component of the absorber layer, the copper indium gallium selenide (CIGS) material. While CIGS PV has yet to achieve the high volumes that were once expected of it, it does seem to have much going for it. It has the highest demonstrated efficiency of all the TFPV technologies, approaching that of crystalline silicon PV cells. Combined with the benefits generally associated with all of the TFPV technologies light weight, potential flexibility, and anticipated lower cost NanoMarkets expects CIGS PV to gain a large share of the TFPV market over the next eight years. And, although CIGS PV has taken longer to take off commercially than many of its supporters hoped, it can now be considered commercialized and NanoMarkets expects CIGS PV to achieve more than 2 GW in annual production by While CIGS PV's potential for higher conversion efficiency is the major factor keeping it in play in the TFPV market, it is not the only one. CIGS shares all the advantage of light weight and

3 flexibility with other TFPV technologies, but also has some special characteristics that represent market drivers. This includes the fact that CIGS' performance does not degrade simply due to light or heat exposure if moisture is effectively excluded from the cells. In addition, CIGS' bandgap is infinitely variable based on the relative amounts of indium and gallium. This could allow tuning of the bandgap to optimize tandem cells. Finally, CIGS PV does not suffer from the stigma of incorporating toxic cadmium into cells to nearly the extent that CdTe PV does. From the perspective of the indium industry, growth in CIGS PV technology will naturally result in growth in demand for indium. Indeed, if CIGS takes off as some people expect it will, CIGS may emerge as the next most important application for indium after ITO within a relatively short space of time. (Note: Although ITO seems to be in significant decline in the PV industry, its decline in the liquid crystal flat-panel display industry is expected to be quite undramatic.) Probably the only thing that can prevent the CIGS market from gaining a large share of the PV industry in the medium to long-term future would be the emergence of a new PV technology that is considerably more efficient and also cost effective. There are actually quite a few PV technologies being developed that might qualify given time including an approach that would use InP or at least an InP layer as part of an advanced PV cell. Such a development is largely speculative at the present time, although InP PV systems are already a reality in a very limited sense in certain aerospace systems ITO, Indium and PV: A Story of Market Evolution The front electrodes of any PV cell must allow light through and there are, as we have already noted, two general approaches to doing this. One is to use a silver grid; the light goes through the holes in the grid. The other is to use a transparent conducting material. Although there are now many kinds of transparent conductor commercially available, the dominant material is ITO, a material to which indium makes a major contribution in terms of weight. With the advent of a-si PV cells in the 1980s in portable, low-power applications like solar calculators, ITO began to make a significant showing in the PV market. These thin-film cells do not have the carrier mobility of doped crystalline silicon, so their surfaces must be uniformly coated with a conductor to effectively capture the carriers generated in the cell, and (obviously) the conductor must also be transparent to allow light into the cell. ITO quickly became the standard transparent conductor, which was used for the front electrodes of a-si PV cells. ITO worked well in these rigid a-si PV cells on glass substrates; one of ITO's main disadvantages its lack of flexibility is not a serious problem in this environment.

4 However, ITO is expensive and this is a special disadvantage for the a-si sector, which has traditionally been targeted towards cost sensitive applications. Nonetheless, a-si PV has continued to use ITO to a considerable extent, although it has gradually substituted other transparent conducting oxides for ITO, primarily on cost grounds. Also working against the potential for selling ITO (and hence indium) is that the a-si sector of the PV market has been losing market share in the entire PV market in the last few years. This is because the energy conversion efficiency of a-si is quite low and because a-si rose to prominence because it used less silicon at a time of silicon shortage. But that silicon shortage is now over and a-si can no longer benefit from it. In the current market environment, c-si PV continues to grow fast, but shows no sign of using much ITO. Meanwhile, PV using CdTe and CIGS has been growing rapidly in importance. CdTe PV has been brought into high-volume manufacturing by First Solar, which is now the largest PV panel maker in the world. GE is also now getting into the CdTe business, guaranteeing that CdTe will take a large share of the PV market for the foreseeable future. However, First Solar has chosen tin oxide as the transparent conductor for its front electrode and there is no reason to think that GE will opt for ITO. We have already mentioned the potential for CIGS as a significant user of indium in the future, but this potential will be realized almost wholly at the absorber layer, since most CIGS makers seem to be using aluminum-doped zinc oxide (AZO) as a transparent conductor. Apart from c-si and TFPV, there are niche PV technologies where ITO still seems to rule the roost. One of these is organic PV (OPV), which uses entirely organic materials at the absorber layer. The future of this technology is unclear. It continues to attract considerable interest, but its conversion efficiency is extremely low. It was always understood that this would be the case, but it was also thought that this could be compensated for by the very low cost of OPV. However, it has turned out that OPV has not proved to be especially inexpensive and it appears to need special consideration when it comes to encapsulation. Another type of PV that is sometimes lumped together with OPV is dye sensitized cell (DSC) technology which is a hybrid technology using organic dyes and titanium dioxide as an absorber layer. DSC is also being commercialized at a relatively modest rate, although it is doing better than OPV in that it has some fairly immediate prospects for deployment in BIPV. However, in both the case of OPV and DSC, ITO is used almost exclusively as a transparent conductive oxide and because ITO is so little used in other parts of the PV industry, its use in OPV/DSC assume some importance, despite the fact that OPV/DSC takes such a small share of the PV industry as a whole.

5 In fact, OPV/DSC's relative unimportance may actually be the reason why ITO still has pride of place. OPV/DSC has many obstacles to surmount on its path to commercialization. An adequately performing, off-the-shelf transparent conductor allows OPV developers to focus on other issues as they work to make OPV/DSC commercially viable. However, there are also serious efforts to replace ITO even in OPV/DSC and as a result NanoMarkets expects OPV/DSC to use less ITO over the eight-year forecasting period considered in this report. 1.2 Objectives and Scope of this Report This report is intended to analyze and quantify the use of indium in the photovoltaics industry over the next eight years. This is done from both an applications perspective (how it addresses the needs of each of the relevant PV technologies), and a materials perspective (the various types of materials containing indium). We are principally concerned in this report with indium materials, but we also discuss the processes and equipment used to produce these materials, as well as the activities of indium producers, PV firms, and equipment firms, when this seems to impact the materials level in a significant way. Another goal of this report is to provide detailed forecasts of the markets for the various indium-containing materials considered in this report, as they apply to the photovoltaics industry. With an uncertain economy and the emergence of new PV technologies, quantitatively predicting indium use and consumption is an intricate task. ITO especially has so many applications outside of PV that the major market forces working on it are likely to be outside the PV arena as well. CIGS for PV cells, on the other hand, is expected to make up a significant portion of the indium market and have a large impact on its demand. This report is international in scope. The forecasts are worldwide forecasts and we have not been geographically selective in the firms that we have covered in the report or interviewed in order to collect information. 1.3 Methodology of this Report The information for this work is ultimately derived from a variety of sources, but ultimately comes from primary sources interviewed as part of NanoMarkets' ongoing interview program with business development managers, marketing executives and technologists in both the electronics and photovoltaics industry. We also drew on an extensive search of technical literature, relevant company Web sites, trade journals, government resources, and various collateral items from trade shows and conferences. Some of the material in this report represents a refining of the research done for several of NanoMarkets' previously published reports to focus specifically on indium's role in PV.

6 As with all of NanoMarkets' reports, our assessment of the business prospects for indium in the photovoltaics industry is based on an analysis of the underlying needs for the features and capabilities that indium-containing materials offer, as well as their inherent limitations and likely alternatives. The basic approach taken here is to look at the underlying PV markets and assess the likely penetration of indium-containing materials into each of them. The forecasting approach taken in this report is explained in more detail in Chapter Four. 1.4 Plan of this Report In Chapter Two, we examine the photovoltaics markets in which indium-containing materials are used or likely to be used. This includes a measure of background about each of the photovoltaic technologies and explanations of where and why indium-containing materials might be used. In Chapter Three, we analyze the markets for indium as they apply to photovoltaics, covering indium currently used in photovoltaics as well as indium-containing materials that are not presently used in PV but have the potential for use in these PV markets. Finally, in Chapter Four, we provide detailed forecasts of the markets for indium-containing materials in the PV applications covered in this report. In this chapter, we project the market forward in both volume and value terms, with breakouts by PV technology and material type.