With a promise of $49 million in inducements from Gov. Rendell, a Greek solar-cell maker says it will break ground next year on a sprawling manufacturing facility in Philadelphia's Navy Yard.
HelioSphera US says the $500 million plant will employ 400 people when it begins operations in late 2011. It will be able to produce 1.2 million thin-film solar modules per year.
Panos Ninios, president of HelioSphera US, said the company chose the Navy Yard site after reaching out to eight states and visiting 35 locations. He said that the quality of Philadelphia's workforce, the proximity to transportation, and the government incentives sealed the deal for the city.
Rendell said the grants and loans were a small price to pay to attract a facility that could provide a major boost to the vision of creating a campus of clean-energy businesses at the former Philadelphia Naval Shipyard site in South Philadelphia.
"We believe there's significant growth potential here," the governor said at a news conference attended by Ninios and Mayor Nutter. "We believe if you fast-forward the clock to 10 years from now, that 400 jobs may be just a fraction of the number of people whom we employ here as solar continues to grow."
Symbolic of the major shift under way in the nation's diet for energy, the new 500,000-square-foot factory will be located directly across the Delaware River from the Sunoco Eagle Point Refinery in Westville, N.J. Four hundred refinery workers were furloughed there last month when Sunoco shut the plant because of falling demand for motor fuel.
"Solar is going to be like steel and petroleum was in the 20th century," John Hanger, the secretary of the Pennsylvania Department of Environmental Protection, told the Inquirer Editorial Board yesterday.
HelioSphera is based in Athens and recently opened its first manufacturing facility in Tripoli, Greece. The two-year-old, privately held company employs a process licensed from Oerlikon Solar, a Swiss company, to produce thin-film photovoltaic panels, which are rapidly gaining share in the solar-cell market because of their low cost.
Thin-film solar cells do not produce as much electricity as traditional crystalline silicon solar panels, but they are much cheaper to manufacture and more competitive in large-scale applications. Ninios said the Philadelphia plant would have 160 megawatts of annual production capacity.
Rendell said that HelioSphera had been introduced to him by representatives of Plainfield Asset Management L.L.C., a Connecticut investment adviser that is behind a project to build an ethanol plant in Clearfield County. Plainfield is a lead equity partner in HelioSphera, and Ninios is also a Plainfield managing director.
HelioSphera's impressive partners -- Barclays Bank P.L.C. is providing debt financing - convinced the state that the Greek company was a real player.
"We took that very seriously," said Michael Rossman, director of the Governor's Action Team, which is responsible for business development.
The state offered $20 million from the Redevelopment Assistance Capital Program, and the Philadelphia Industrial Development Corp. offered the 40-acre Navy Yard site for $1. The property is in the undeveloped eastern part of the Navy Yard and will require substantial infrastructure investment, as well as some wetlands mitigation, said John Grady, senior vice president of the PIDC.
New York state offered an incentive package that Pennsylvania officials valued at $40 million, so Rendell increased the state's offer to include other loans and grants, including some pending federal stimulus-grant money.
"It was necessary for us to compete at a significant level," Rendell said. But he said the HelioSphera's private funds would total about nine times the state's investment, and the income taxes from the 400 jobs, as well as construction jobs, "will surpass our investment in a short order."
In addition to the grants and loans, the project would be eligible for Keystone Opportunity Improvement Zone benefits, which would exempt it from state and local business taxes until 2025.