Polysilicon Maker REC Silicon In 10 year Deal With Hanwha In US For Supplies

Norwegian Polysilicon manufacturer REC Silicon has entered into a 10-year agreement with South Korean conglomerate Hanwha Solutions to offer fluidised bed reactor (FBR) polysilicon. REC’s two U.S.-based plants have a capacity of more than 20,000 MT of high-purity polysilicon. Readers will recall that the US had imposed severe restrictions on sourcing modules from firms that have used polysilicon manufactured in China’s Xinjiang province, disrupting plans for many Chinese manufacturers and US based developers. The move coincided with a rise in polysilicon prices due to other disruptions as well, reviving prices, and interest in polysilicon manufacturing elsewhere in Europe and other regions.  the firm is also a key producer of Silane gas, which also finds use in solar production.

REC’s US subsidiary REC Solar Grade Silicon LLC entered into a binding term sheet with Hanwha Solutions for a 10-year take-or-pay offtake for FBR polysilicon produced at an idle facility at Moses Lake, Washington. The offtake is to provide its entire FBR production to Hanwha Solutions from the facility.

The base price for the offtake under the agreement will be determined by market indices adjusted for a premium for US-sourced low-carbon material. REC has also provisioned the agreement for extreme volatility, to guard against the sort of low prices that forced many western manufacturers to pause production earlier.

“Securing offtake of production volumes has been a prerequisite for the reopening of the Moses Lake facility, and it marks a milestone to have this in place. We continue to move forward with our plan for a restart of the facility in Q4 2023 with an ambition to reach full capacity utilisation by the end of 2024,” said Kurt Levens, CEO of REC Silicon.

Even as a formal agreement will happen in due course, REC Silicon has not yet shared plans to expand production capacity yet, considering the rising interest in sourcing polysilicon from outside China.