SAN FRANCISCO-Nanosolar Inc. said Wednesday it will select a Bay Area location for development of the world’s largest solar cell fabrication facility, one that uses new less expensive technology. The Palo Alto, CA-based company said it will select San Francisco, San Jose or Santa Clara for the plant before then end of July. A complementary solar panel fabrication facility is expected to be located in Berlin, Germany, where the company also has a base of operations.

The company is presently in pilot production of its paper-thin flexible solar cells in Palo Alto and has started ordering volume production equipment for the new factory. Nanosolar says the new plant could produce upward of 1 million solar panels every year, enough to produce 430 megawatts of power--nearly triple the output of all existing solar panel manufacturing facilities in the US.

Nanosolar began pursuing its goal of affordable solar electricity in 2002, shortly after receiving seed money from Google founders Larry Page and Sergey Brin. The company’s CEO, R. Martin Roscheisen, sold his Internet company eGroups to Yahoo for $432 million in 2000.

Roscheisen says the past four years have been spent in commercial research and development, including two years of manufacturing process development and engineering. The company now believes it can mass produce a fundamentally less expensive solar cell. In Berlin, the cells will be assembled into panels that will be shaped to fit on a variety of building components. The company reportedly already has arrangements to sell the panels for use on the rooftops of commercial and residential buildings and as stand-alone power plants.

What’s different about Nansolar’s technology is that it does not make use of silicon crystals, which is how 90% of the world’s solar energy is currently produced. Instead, Nanosolar and others such as San Jose-based Miasole are using a copper alloy that also absorbs light and creates electricity.

Nanosolar’s head of technology says its method of putting the alloy on a thin plastic film “overcomes the complexity, high cost, and yield and scalability limitations associated with vacuum-based processes” and “allows us to produce cells very inexpensively and assemble them into panels that are comparable in efficiency to that of high-volume silicon based PV panels."

Werner Dumanski, Nanosolar's head of manufacturing, says the company’s printing process makes the fully-loaded cell cost -- including materials, consumables, energy, labor, facility, and capital – “less than the depreciation expense that vacuum thin-film companies have to pay for the equipment that produces their cells." The size and cost of the facility was not released; however, Dumanski says the cost would be much less than the estimated $1 billion it would cost to develop a similar-capacity factory using conventional solar technology.

According to Clean Edge, a business research firm based in Oakland, global solar markets reached $11.2 billion in 2005, up 55% from 2004. By comparison, Global wind markets reached $11.8 million in 2005, up 47% from 2004, while the market for biofuels hit $15.7 billion globally in 2005, up about 15% from 2004, according to Clean Edge. By 2015, Clean Edge models show solar photovoltaics (including modules, system components, and installation) growing to $51.1 billion, wind power expanding to $48.5 billion and biofuels growing to $52.5 million.

The world's largest existing solar factories are in Japan, run by Sharp and Kyocera. At full capacity, Nanosolar’s new plant wouldn’t move the US ahead of Japan, but it would push it ahead of the current No. 2 solar producer, Europe.