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[See the bottom of this post for a video walk-through of SunPower’s Richmond, Calif. facility]

VentureBeat got a chance to peak inside SunPower‘s manufacturing facility in Richmond, Calif., today, to take a closer look at its crystalline silicon solar panels. Founded in 1974 with technology spun out of Stanford University, SunPower is one of the oldest photovoltaic companies in the U.S. and one of the first exclusively solar companies to go public, beating giant First Solar to market.

Today, its business is built entirely on crystalline silicon panels tailored for residential and commercial rooftops, distributed power stations, and utility-scale solar plants. It manufactures and installs both the panels and the tracking equipment that dramatically ups their efficiency. It’s known for achieving the highest solar efficiency rates to date, with tracked panels converting more than 30 percent of the sunlight absorbed into usable power.

SunPower’s panels — protected by a flurry of patents — have a reported minimum efficiency rate of 22 percent. Compare that to the thin-film solar panels being churned out by SunPower competitors like First Solar, NanoSolar, and (much hyped) Solyndra. They have average efficiency rates slightly above 10 percent, and many have only been tested in laboratory conditions.

But thin-film seems to be where the venture capital has been flowing over the last several years. The recipients boast that their products require less silicon, dropping their cost, and making them more feasible for more markets. With all this buzz, crystalline silicon has started to seem almost passe — even though it makes up the bulk of current installations.

The fading limelight also belies SunPower’s recent gains. The company is seeing steady gains in sales and utility contracts and has no interest in branching into thin-film, according to the company’s founder, Richard Swanson. In fact, he thinks investor and media interest is going to start migrating away from thin-film as the solar industry at large starts to heat up.

“I certainly wouldn’t pitch a thin-film concept today,” Swanson said. “It seems like the window on that is closed. It turned out to be harder than everyone thought.”

Of course that’s going to be SunPower’s position, but there’s some logic to it. Venture capital dollars have started to swing away from thin-film solar plays. By and large, they are too capital-intensive and take too many years to produce returns, analysts say. The price of silicon has also plummeted over the last year, making business models based on sparing the material less compelling — and at a basic level, thin-film efficiency rates just aren’t all that competitive.

So what accounts for all the initial VC hype around thin-film? Solyndra, maker of cylindrical solar modules, was able to score $535 million from the U.S. Department of Energy for its thin-film solution, based largely on this enthusiasm; Nanosolar landed $300 million in 2008, and Heliovolt more than $100 million in 2007. Swanson’s guess as to why: A poor understanding of the industry early on.

“When it came to solar, venture capitalists got caught with their pants down,” he says, adding that investors didn’t really start to pay attention to the sector until after SunPower’s IPO in 2005. “Early on, there was very little expertise within the VC community.”

Now hip to the facts, investment firms seem to be turning their attention to less pricey solar component deals — just look at the rash of funding rounds secured by makers of solar microinverters, devices that optimize the power pumped out by panel arrays, like Enphase Energy and SolarBridge. There is also a lot of excitement about software systems designed to remotely monitor and even repair solar arrays to ensure maximum energy output.

In this environment, SunPower’s consistent, upward trajectory is a victory. Its R&D operations continue to improve panel efficiencies, and it’s been very successful at expanding its plant development goals via the acquisition of its own customers. Just this year, it bought European developer SunRay Renewable Energy for $277 million, its first major growth spurt since its $333 million purchase of PowerLight in 2006.

But not all is smooth sailing. China has become a formidable foe in just the last two years, and there’s no getting around the sudden ascent of competitors like SunTech Power. Regulations are lax in China, and development and labor costs are staggeringly low. As Swanson puts it, “They’ve been able to move price points that the industry here thought couldn’t be moved.”

SunPower is admittedly, and legitimately, concerned.

“China was the big story in 2009 — the progress was stunning,” Swanson says. At first, the industry and media dismissed the panels produced in the country as low quality, far behind western producers, particularly in leading Germany and Spain. But quality has quickly caught up, and the companies at the forefront have a huge domestic market to tap.

Swanson’s response: “We are always scared. We follow the saying that only the paranoid survive.”

But China’s looming threat is more of a long-term worry. In the present, SunPower is more concerned about making new sales and deals. One in particular is a high priority: a $1.2 billion joint venture with Taiwanese display maker AU Optronics to produce 1.4-gigawatts worth of solar cells. All of the manufacturing will take place at a new, co-owned facility called Fab 3 in Malaysia, which will derive much of its own power from, what else, SunPower rooftop panels.

Here’s a video walk-through of SunPower’s facility in Richmond, Calif. The building was initially owned by Ford and used to build its A Frame vehicles. Just another example of antiquated automotive plants being revamped into cleantech manufacturing centers.

An overview of the utility-scale tracking technology from Howard Wenger, president of utilities and power plants:


A look at the rooftop panel assembly line:


Rolling off the assembly line:


A tour of the upstairs offices, where some of the company’s sales, marketing nad engineering operations are based:


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