Gumi solar panel factory will add six lines by 2018LG Electronics announced on Wednesday that it will build six additional production lines for photovoltaic panels at its Gumi factory in North Gyeongsang by the first half of 2018.
The company will spend 527.2 billion won ($438.9 million) on the project.
The Gumi factory currently runs eight production lines for the eco-friendly and highly efficient solar panels. The additional lines will increase total manufacturing capacity from the current 1 gigawatt per year to as much as 3 gigawatts by 2020, LG said.
Three gigawatts is equivalent to the combined electricity that one million households usually consume in a year.
“We have laid the groundwork for a new leap in the solar energy business, the future growth driver, through this investment,” said Lee Sang-bong, business-to-business head and president of the LG Energy Business Center. “We will lead the global solar energy market by continuously unveiling extra-efficient premium products and providing distinguished value.”
The IT arm of LG Group identified the energy business as one of its next-generation growth engines and established the LG Energy Business Center in November 2014. The center oversees solutions for solar energy, energy storage systems, lighting and energy management.
For the Gumi facility upgrade, LG and the governments of North Gyeongsang and the city of Gumi signed a memorandum of understanding. LG believes the new production lines will contribute to creating 870 more jobs in administration, research and manufacturing.
LG Electronics entered the solar module business in 1995 and rolled out the first photovoltaic solar modules in 2010. The premium panels are now being exported to the United States, Japan, Australia and many countries in Europe.
The world’s photovoltaic panel market is currently led by China’s Trina Solar. But with a low-margin business structure, the company suffered three consecutive years of losses until 2013.
The industry’s business risk still lies in overbuilding and ending up with too much capacity, which will eventually drive down prices - a cycle that was seen from 2011 to 2013.
As interest in sustainable and renewable energy continues to spread, the demand for solar photovoltaic panels is expected to grow, analysts say. The global solar photovoltaic installation market is expected to grow from 29.6 gigawatts in 2011 to as much as 60.05 gigawatts by 2018.
To prepare for the expected explosion of global demand, many key players are scrambling to beef up their production capacities.
BY SEO JI-EUN [firstname.lastname@example.org]
More in Industry
From Europe with love
SK Holdings creates hydrogen investment business unit
'Netflix law' to go into effect from Dec. 10
LG Energy Solution launches, aims for ￦30 trillion sales by 2024