silicon for the chemical and solar industry XIII

The figure shows that the PV sector in 2015 is larger in terms of its demand of

mgSilicon, than the entire Chemicals market was in 2005. In 5 more years the

Photovoltaics market will be nearly 85% the size of the Chemicals market, in terms of

volume of silicon that is required.

The metallurgical silicon industry is becoming increasingly dependent on the solar

sector to diversify it from the Aluminum sector.

The purpose of the above figure is to demonstrate the impact the solar market has on

the metallurgical silicon industry. But this impact is not one sided as the metallurgical

silicon industry also has growing importance on the polysilicon sector in terms of costs.

Metallurgical silicon costs today represent nearly 20% of production costs some Tier 1

polysilicon and chemical producers

and this is only from one single raw material.

Therefore, a polysilicon producer who grinds its own metallurgical Silicon and sells

its current waste stream from grinding for low value to the refractory sector is motived

to recycle these wastes and use them in their polysilicon plant.

In fact, there are already concerted efforts to increase the usage of higher and higher

portions of fines from the grinding process in the polysilicon and chemical processes,

but these efforts also have a high costs in terms of increased slurry handling and lower

energy efficiency, not to mention that the grinding fines carry in more impurities to the

system due to their nature.

Improving metallurgical silicon performance in the polysilicon and chemical

processes also are a focus of many producers, as with polysilicon prices in the mid

$10’s per kilogram, every effort must be made to squeeze higher efficiencies from the

process.

Metallurgical silicon producers also are increasingly focused on cost reductions as

their has long been a cost driven business. A review of the possible benefits to a

metallurgical silicon producer who grinds their own silicon if they were to recycle their

wastes, based on the

approach, has been undertaken based on hypothetical

parameters.

The result of the exercise shows possible increase in gross margins of 1%. This

exercise assumes estimated premiums and costs for ground silicon powder as well as

conversion costs of the wastes based on the proposed technology.

A polysilicon producer who owns and operates its own metallurgical silicon

production facility might also benefit from translated cost savings from recycling of

grinding wastes under various conditions. These financial benefits are estimated to be

on the order of 90 – 160 basis points based on internal modelling.

Wacker Chemie Q1 2016 conference call note – April 28th 2016