Last week we spoke to Shayne Jaenisch, CEO of Tindo Solar, the only solar panel manufacturer in Australia. Despite being a “lone warrior” in the Chinese era of solar, Tindo appears to be doing well enough as it’s switching from a production line of 65 MW to 150 MW, and Jaenisch claims that the company has been able to eat the rising cell costs of the past 12 months without having to raise the price of its panels. The multiple 15% cost increases from battery suppliers are a serious concern, as well as inverter supply issues stemming from the global chip shortage.
Tindo sold its first panels in 2011, not long after BP solar closed its cell and module factory, and not long before SilexSolar’s end. Its founder Adrian Ferraretto came from Solar Shop, Australia’s biggest residential installer, which also failed not long after his departure as the government reduced solar subsidies. By the time Tindo had a team and a manufacturing line ready to go, its private equity backer went broke. Ferraretto spent the better part of a decade, from 2011 to 2017, trying a variety of approaches to keep the company afloat, including attempts to lobby the government to move against Chinese solar dumping, and a disastrously premature switch from DC to AC panels.
Come 2017 Tindo was acquired by Cool or Cosy, an insulation installation company which noticed Tindo Solar while working on a municipal rooftop solar contract in Adelaide, the capital of South Australia state, where both companies are located – the state is also the most developed rooftop solar region in the world, with 50% of residences having solar and a grid that reaches 100% solar power for a longer period each year. South Australia had a major blackout in 2017 which redoubled interest in domestic solar power, especially with storage.
Jaenisch became Tindo’s CEO with the Cool or Cosy acquisition at which point the company had just 10 MW annual sales. In a few years sales were scaled up to 20 MW, then 25 MW in 2021, with 2022 forecast for over 30 MW.
Tindo expected to be running on G1, 158.75 mm cells for a while – they were introduced only in 2018 – but not long after, Chinese suppliers had begun the switch to M10 182 mm and G12 210 mm, with coalitions of companies choosing each size, and some of the larger companies working with both. Since Tindo serves the residential segment, it went with the 182 mm faction, with eight weeks’ notice to switch its production line over. The 210 mm-based panels weigh over 40 kilograms, as compared to Tindo’s 21.5- and 29-kilogram 182mm products. Tindo is sticking with Mono PERC technology for the foreseeable, although Jaenisch mentioned having interviewed an engineer with a perovskite Phd for a job opening the day before.
Cells are where most of the solar supply chain’s high technology is to be found, but Tindo manages to produce a high-end product as a mere module maker. The company claims 1/200th the failure rate of competitors, which Jaenisch attributes to a strict testing and correction regimen – “We’ve always been a company that’s too small to throw anything away. We test every cell individually and cut out damaged areas, and we make panels one at a time. Our new line has string-level electroluminescence testing.” If the failure rate is still too low to be believed, then we can chalk it up to a reporting differential – whatever faults do occur with Tindo could be disproportionately less serious, therefore more likely to go overlooked and unreported. Tindo is able to offer a 25-year product warranty, on par or better than larger rivals.
Jaenisch has a background in the armed forces before he entered business, and it visibly pains him to admit that his modules use imported Chinese cells – even though practically everyone does, aside from technology-based start-ups and a few larger Western and Indian companies. “We ordered our new production equipment out of China because the lead times from Europe were too long and the quality wasn’t what we wanted,” says Jaenisch. Nonetheless Tindo benefits from the widespread Australian preference for domestic products – a sentiment that only strengthened in 2020 with the pandemic. In 2020 Australian rooftop solar installations jumped by 33.7 %, whereas Tindo’s grew 38% in retail and 64% in wholesale.
It’s that desire to move away from Chinese imports which is the big opportunity for this small company that has survived a decade of the Chinese import flood. Jaenisch says he’s watching the US Department of Commerce’s AD/CVD investigation closely, and has been talking to US project managers whose supply of Chinese modules has dried up. In the dream scenario Chinese panels will be barred from the US and Tindo modules will remain in the clear. It might seem strange for a small Australian residential solar maker and installer to be looking across the ocean for customers, but Tindo already sold to Vietnam during that country’s 2020 boom – Ho Chi Minh city hosts Tindo’s largest system so far, a 1 MW ground mount. “With some luck we can increase production to 100 MW and start exporting soon.”
It has yet to be seen whether Tindo can avoid being caught up in anti-Chinese measures given its own reliance on Chinese cells. For now it’s just the US engaging in such measures, but if the US goes all the way with sanctions and tariffs, Australia would be likely to imitate. Besides anti-dumping, Uyghur forced labour allegations can always be revived. “We don’t have the supply chain transparency that we wish we had,” says Jaenisch – Chinese companies won’t disclose what products trace back to Xinjiang polysilicon until they are forced to. The ingot stage and above remains opaque to Western customers. Polysilicon makers typically have some, but not all of their production located within Xinjiang.
Jaenisch mentions “one Australian company” recently de-listed by the Clean Energy Council, which Jaenisch believes was masquerading as a module manufacturer while only relabelling fully-assembled Chinese modules. That is presumably MSquare Energy, but the CEC has not fully explained its actions.
So one possibility is for Tindo to be categorized as non-Chinese while still using Chinese components – the other is it finds new, non-Chinese cell suppliers. “We need to have a vertical supply chain here in Australia,” says Jaenisch “I’ve spoken to people here who want to mine metallurgical silicon, potentially take it to polysilicon, even ingot stage. I’ve spoken to the aluminum camp as well, making sure everything is made in Australia. But it’s challenging because China dictates what happens and when.”
Building an Australian solar manufacturing base won’t happen in a free trade situation, but there’s a broad Australian political view that the country should become less dependent on Chinese imports. Jaenisch has participated in a government inquiry into “sovereignty manufacturing” – for all kinds of industries the government wants domestic production, and it wants corporations to lead that agenda. Just recently Jaenisch delivered a presentation to officials, saying that solar-grade glass should be one of the first components re-shored to Australia because of its high weight and shipping cost per unit value.
Even foreign manpower is set to be avoided in northern Australia, despite the proximity of Indonesia, thanks to simplified deployment schema developed by the likes of rival supplier 5B.
With green hydrogen and the mining industry of the Pilbara and other areas, Australia can build out far more solar than would be needed just to supply its own 26 million citizens with power. It will not be surprising if companies such as Fortescue Future Industries starts working with Tindo Solar and others on a domestic supply chain. Fortescue has a 450 GW renewable development vision and Rio Tinto has a need for 300 GW, with Australia a significant arena both for mining power demand and even more so utility-scale solar development.
The easy path for solar development will always be to keep tolerating Chinese imports, but if the West is willing to cause economic disruption at home and worldwide by sanctioning Russian supplies of fuel and other commodities, then it is surely willing to level more sanctions and tariffs against China at some point. Polysilicon’s high electricity use makes it hard to produce cost-effectively in the West, but granular FBR polysilicon methods require only a third of so of the electricity used by the mainstream Siemens Process, and Indian polysilicon exports could become a thing this decade. So there are options.
Tindo is by no means the only company standing to benefit from the AD/CVD investigation. Canadian module maker Heliene has become sold out of stock through to 2023 because of the interruption of Chinese imports, and will expand from 660 MW to 900 MW production capacity, largely located in Indonesia and India. Two weeks ago utility NiSource decided to delay retirement of several coal generators, and the majority of US solar developments look to be stalled through 2022, with 2023 also at risk. This week further calls to hasten the investigation have reached President Biden’s desk, this time in a letter signed by nineteen state governors.
The latest news from the investigation itself is that eight companies – JinkoSolar, Trina Solar, Hanwha Q Cells, Canadian Solar, Trina Solar, BYD, New East Solar, Boviet Solar, and Vina Solar – two each in Malaysia, Thailand, Cambodia, and Vietnam respectively, with the Department of Commerce stating it doesn’t have the resources to examine every manufacturer in a reasonable time period. These eight have until May 27th to submit requested information to the DoC. If the investigation is hastened, then it may provide a preliminary conclusion before August 2022, but either way this is not going to be a bumper year for US solar.
A lingering peculiarity of the AD/CVD investigation is that it was first petitioned for by an anonymous grouping, which was rejected on grounds of anonymity, then by the 100 MW Auxin Solar, which was accepted. One obvious inference to consider is that Auxin solar was put up to it by larger parties with more resources to spare on lawyers. In Renewable Energy World’s interview with Auxin’s CEO Mamun Rashid, that accusation was put to him, and his response included the words “quite offensive … folks should do some research and use their brain cells … very insulting … ”, alongside more rational points about Auxin’s interests.