Moses Lake site at forefront of polysilicon industry

The most ambitious ongoing construction project in Washington is just out of sight of Interstate 90 near Moses Lake.

For $1.2 billion, REC Silicon expects to double output of polysilicon at a facility that only five years ago stood idle for lack of demand. Now, the world cannot get enough of the stuff.

Every pound the industry can produce is spoken for five years out.

Spot prices have climbed more than tenfold, to about $180 per pound, since 2004.

The fluidized-bed reactors and associated silane gas plant REC Silicon is building will make the company the world’s dominant polysilicon producer and transform the economics of solar power, said longtime industry advocate Mike Nelson, executive director of the Northwest Solar Center.

“They know they’ll have the market cornered if they move fast enough,” he said.

But the sun has risen ever so slowly at 3322 Road N, NE, about three miles east of downtown Moses Lake.

As Project Manager Jim Flores maneuvers a pickup through 4 inches of mud at the compact site, hundreds of blue and red hardhats bob toward a central dining area for lunch. The dining area and heated restrooms were installed to make the relatively remote construction site as attractive as possible to workers from outside the area, Flores said.

At times, more than 1,000 have been on the 400-acre site.

But creature comforts were no match for a week of subzero temperatures in January. Flores said ice was everywhere. The exposed reactor tower became a giant freezer.

Construction had already fallen behind schedule, at great cost.

Corporate parent REC Group, based in Oslo, Norway, last month announced work on the reactor portion of the project would cost close to $800 million, not the $660 million budgeted. Production from the new plant will not begin until late this year, not in the third quarter as planned.

REC Silicon President Goran Bye (pronounced Huron Bee) said returning to Oslo with the bad news was not one of his proudest days.

Worldwide demand for materials, equipment, and shop time, among other factors, slowed progress, he said. Also, although glad to have Fluor Corp. as its contractor, a growing REC Group wants to take on a greater share of project management in the future, he said.

REC Silicon has already established an engineering and project management office in Houston so more design work can be done internally, he noted.

Bye said scaling up a company less than 14 years old has consumed the entire REC Group executive team. Bye, 48, is an executive vice president of the group.

REC is already the world’s largest producer of polysilicon for use in photovoltaics, and the third-largest producer for all uses. The Moses Lake plant and a larger, newer facility in Butte, Mont., together will produce about 7,000 metric tons this year.

Another division is the foremost supplier of the solar wafers that are the building blocks of most solar panels. REC has a small piece of the panel market, and wants more. In October, the company announced it will build a plant in Singapore that will make panels, and their silicon cell and wafer components.

Bye said more than one-half the world’s liquid-crystal display screens were made using REC Silicon silane gas, a compound of silicon and hydrogen distilled from metallurgic-grade silicon less than 99 percent pure.

He said REC wants to be the pre-eminent player in the solar industry. Design and construction of polysilicon plants requires the longest lead time, the largest investment, and the clearest crystal ball.

The Moses Lake plant was built in 1984. The Butte plant became operational in 1998. Both produced 99.99999 percent pure polysilicon for the semiconductor industry. But when demand swooned in the wake of the dot-com bust, owner Komatsu shut down the Moses Lake operation and stopped ramping up the Butte plant.

REC partnered with Komatsu in 2002, then took over the Moses Lake plant later that year. Bye was brought in as a consultant for restructuring plant operations. “Life was hard,” he said.

Bye had built his career in the software and telecommunications industries, primarily in finance. He had no background in chemistry, but said he could see that REC was onto something in taking over one of Washington’s largest chemical factories.

The plant lived from invoice to invoice through 2003, Bye said, with payroll sometimes riding on the day’s mail. Cash flow turned positive in the first quarter of 2004. REC took over the Butte plant in 2005, and it has ridden the boom in polysilicon demand ever since.

But, Bye said, in every boom lies the germ of a bust.

Companies all over the world are building new plants, or say they will build new plants, to cash in on the solar price flare. By 2012, factories could be producing seven times today’s output. Bye said some question the market’s ability to absorb all the new material.

“That’s the gamble,” he said.

Bye said REC Group will use the additional polysilicon from Moses Lake at its own plants, although some of the silane gas will be sold externally. The fluidized-bed reactors will not only increase production, he said, they also will significantly reduce costs per pound of polysilicon by greatly reducing electricity consumption.

An REC solar module will create enough electricity in less than two years to replace the electricity used to make the module itself, he said. The modules will last decades.

Bye said the industry’s goal is solar power that is no more expensive than that from more conventional sources like coal plants. In many nations near the equator, that objective has been reached. Lower costs will soon make the modules competitive in states like California and Texas.

Bye said REC’s proprietary technology will keep the company among industry leaders. Even as he works on curing the hiccups in the Moses Lake expansion, the company is close to choosing the site for another plant. Wallula, Wash., is among the contenders, but Bye said Iceland and Quebec, Canada, may have an edge. Both offer electricity at attractive prices — REC Silicon in Moses Lake consumes enough to supply about 80,000 homes — and incentives that Washington cannot match, he said.

But Wallula does have easy access to several large wind farms. Bye says the possibility some power used at the plant would be green appeals to REC; the acronym stands for Renewable Energy Corporation.

A decision on the plant could come as soon as this month.

Meanwhile, polysilicon production continues in the original Moses Lake plant using an older technology.

Additions since 1984 have extended its length to slightly more than one-quarter mile. Inside are 68 steel furnace vessels lined up in double file. The original 50 are identified by abbreviations for the states.

The vessels encase polysilicon rods the thickness of a golf club shaft. The rods are electrified, and silane gas is introduced. Over the next week, silicon from the gas gradually builds up on the rods, which are monitored through portholes.

The filaments look like the glowing filaments of a huge light bulb. When they reach the desired thickness, the vessels are removed. The rods, after cooling, are laid out in long boxes, checked for quality and then smashed.

The pieces, a slightly iridescent gray, are the size of a chunk of coal. They are loaded into heavy plastic bags to be packed into cardboard boxes for shipping.

About the size of a 10-pound sack of potatoes, the contents of each bag are worth around $3,000.

Bye said REC employs 350 people in Moses Lake, and will add 170 to operate the fluidized-bed reactors and gas plant. The gas and silicon production processes yield no toxic waste, he said, and Komatsu and REC have stressed safety since a worn section of pipe burst in 1998, killing two workers and injuring two others.

“The last thing we need in this industry is an accident,” he said.

Bye’s intensity periodically gives way to humor. He referred to the reactor as “our little hot dog stand,” and noted that in a career that has placed him at least temporarily in 11 countries, his wife moved with him for the first time to Moses Lake.

“She’s stayed five full years,” Bye said. “I must be doing something right.”

And despite the budget problems, his mind is fixed on the task of keeping REC Silicon the leader in solar-quality polysilicon, and helping make REC Group the sun king.