president letter from this AMDear XXXXXX,
Now there is one. There could soon be five.
I’mtalking about NIPS. That’s Natcore’s Intelligent Processing System.NIPS, our new machine that will allow us to refine and deliver ourcost-effective anti-reflective (AR) coating process to solar fabricationfacilities.
We first told you about NIPS just four months ago,when we began producing it at MicroTech Systems in Fremont, CA. Now weare in the machine’s final testing phase. We are also working onintegrating our black silicon application to this tool, which will makeNIPS the only machine able to grow an AR coating on black silicon.
NIPS will allow us to refine and deliver a cost-effective AR coatingprocess to solar fabrication facilities. Moreover, our black siliconapplication could increase efficiency of solar cells by two to threepercent, and could increase total daily power output by a much greaterdegree. (We’re breaking entirely new ground here, and there’s no way toaccurately determine the power advantages of a black silicon solar celluntil we actually create one and test it.)
We are having “NIPS 1”installed in our new laboratory facility at the Eastman Business Parkin Rochester, NY, where we plan to consolidate our R&D efforts. Thisfacility exceeds our advanced equipment, clean room and testingrequirements and, along with a joint development agreement that we havesigned with Kodak, will enable us to tap into the rich talent pool inRochester — including many highly credentialed casualties of theirdownsizing. This will greatly increase our scientific and intellectualdepth, and allow us to proceed at a much faster rate on our othertechnologies and applications.
The thrust of our efforts withKodak will be to utilize their equipment and experience in high-speed,roll-to-roll manufacturing of thin films as we develop a flexible solarcell. Kodak’s cutting-edge facilities, as well as their leadingexpertise, are at our disposal for relatively small cash outflows. Thisroll-to-roll technology could reduce the cost to manufacture solar cellsby as much as 60 percent.
(Please note that we will continueto utilize Professor Andrew Barron’s group at Rice University throughjoint research agreements to develop our tandem solar cell, and toexplore additional applications for our technology.)
The NIPS #2will go to Hunan TLNZ Solar Technology Co. Ltd. (TLNZ) of Xiangtan,China, with whom we have signed a letter of understanding. Afterextensive testing and adjustments in Fremont, if necessary, the devicewill be shipped to TLNZ. The sale closing is contingent upon asuccessful test by TLNZ.
NIPS #3 will besent to Natcore Technology (Zhuzhou) Ltd., our joint venture formed withthe Zhuzhou Hi-Tech Industrial Development Zone. (I’ve been asked whywe didn’t build NIPS 1 at our joint venture. The answer is simple: wewanted our first machine to be perfect. Our strategy has paid off: Wehave two very important, patented improvements that were conceived ofand implemented after construction had begun. Simply put, theseoptions had not been thought of before and do not exist currently inChina or anywhere else. American technology is still the best in theworld.)
We have confidence that NIPS #4will be sold to another large Chinese solar company. This company, with a500-megawatt production facility (this is equal to the entire U.S.solar cell production capacity), will be sending a delegation includingtheir CEO and CTO to visit our Rice and Rochester labs in mid August.They want to discuss how our process can be integrated into theirfabrication lines. We also plan to discuss potential joint ventureopportunities with them.
We hope to build NIPS #5for Italian solar company that will be visiting us early in August toevaluate our equipment and investigate joint venture opportunities herein the United States. This company, too, will send their CEO and CTO tomeet with us. We have already met with them in Red Bank, at their NewJersey facility, and in Milan.
As you can see, we arefocused on identifying and partnering with world-class companies withextensive manufacturing experience. By partnering with the very bestmanufacturers to integrate our equipment and technology seamlessly intofabrication lines, we know we will be able to meet any company’s needsin the future.
We could have built NIPS 1 more quickly, andperhaps sold one sooner into a Chinese production line. We chose not togo this route, however, because our goal is to make Natcore’s productsthe gold standard in the industry.
We are not trying to make aquick trade; we are trying to build a business. We are not in this foran exit strategy — we want to deliver revolutionary products thattransform entire industries and richly reward our shareholders.
And, along the way, we plan to change the world for the better.