SunPower to build third solar cell plant

San Jose, Calif.-based SunPower (Nasdaq: SPWR) announced today that it would build a third solar cell fabrication plant in Malaysia, expected to have a nameplate capacity of more than 1 gigawatt of annual production.

The company's first two solar cell plants are in the Philippines.

"The scale and breadth of our Fab 3 campus in Malaysia will be a core element of our technology and manufacturing roadmap that drives us to our 50 percent cost reduction plan by 2012," said Tom Werner, CEO of SunPower.

"Malaysia offers us highly educated workers, a receptive business investment climate and the opportunity to significantly expand our production as the demand for our solar systems continues to escalate worldwide."

SunPower, a majority-owned subsidiary of San Jose's Cypress Semiconductor (NYSE: CY), said the new manufacturing facility would be constructed in two phases.

The first phase is expected to be comprised of 14 solar cell production lines with a nameplate capacity of 40 megawatts each.

After completion of phase two, bringing the plant to a scale in excess of 1 gigawatt, the company said the new facility is estimated to achieve materially lower capital cost per watt compared to the Fab 1 and Fab 2 plants.

SunPower said solar cell production is likely to begin at the new plant in 2010, with the integrated site development to start later this year.

The company said the Fab 3 facility would initially launch its manufacturing operations with SunPower's Gen 2 solar cells, adding production of its recently announced Gen 3 solar cells at a later date.