Renewable Energy Corporation

Solar power company in Singapore

During 2008 and 2009, the company faced a crisis with falling income and increasing debt. As of May 2010, the market capitalization is down to 18 billion NOK. The large drop in value has been partially blamed on the financial crisis, which caused a near halving of the price of silicon wafers, as well as increasing costs of investments, in particular due to delays in opening a new factory in Moses Lake, Washington.

In addition due to the continued weak market conditions and prospects of significant negative cash flow, the board of directors announced in October that REC would permanently close down the production capacity at the oldest multicrystalline wafer plants at Herøya, the multicrystalline wafer plant in Glomfjord and the solar cell plant in Narvik. The remaining Norwegian plant, at Herøya, was closed down in 2012. All of REC's solar cell and wafer production plants in Norway were shut down permanently in 2011 and 2012 due to weak market conditions and prospects of significant negative cash flow.

In 2013, REC announced that it would establish REC Solar as an independently listed company, and REC will continue operating in polysilicon business. REC changed its name to REC Silicon in October 2013. The splinter company consisted of the silicon manufacturing facilities at Moses Lake, Washington and Butte, Montana and is based in the United States. At these plants, REC Silicon produces polysilicon and silane gas for the solar industry and the electronics industry. REC Silicon produced 21,405 MT of polysilicon in 2012, and targets a production of 20,000 MT polysilicon in 2013.

REC has entered into a significant long term agreement for supply of mono crystalline silicon wafer to Suniva, Inc. Under the agreement, REC will until 2013 deliver wafers worth more than US$300 million. REC also entered into a significant long term agreement for supply of mono crystalline silicon wafers to China Sunergy Co. Ltd. Under the agreement, REC were to deliver wafers worth more than US$400 million until 2015. It was structured as a take or pay contract with pre determined prices and volumes for the entire contract period. However, in 2009, this contract became the cause of a legal battle between REC and China Sunergy. As spot prices for wafers fell dramatically in 2009, China Sunergy found itself bound to prices well below spot, prompting a stall in purchasing, leading REC to terminate the contract.

The shares are listed on the Photovoltaik Global 30 Index since the beginning of this stock index in 2009. During the past few years REC's stock price has gradually come down as a result of the demanding times in the solar industry due to overcapacity and heavy price pressure on solar products.