Suntech Power Holdings Co., Ltd. (NYSE: STP [1]) one of the leading manufacturers of photovoltaic (PV) cells and modules, today announced that it has entered into a $180 million agreement with Renewable Energy Corporation ASA (Oslo Stock Exchange: REC [2]), the world's largest manufacturer of multicrystalline silicon wafers for solar applications, to purchase silicon wafers over a 5-year period.

''This agreement, together with our other long-term supply agreements, will enable Suntech to further reduce spot market purchases of raw materials and improve our cost competitiveness in the future,'' said Dr. Zhengrong Shi, Suntech's chairman and CEO. ''This agreement also enhances our strategic relationships with the world leading silicon and wafer manufacturers. Suntech will continue to pursue our goals to expand our market share and focus on our ongoing initiatives to make production and technological improvements to our cell and module products.''

The 5-year agreement is structured as a take-or-pay contract with a pre-determined fixed price that decreases on an annual basis. This price reduction curve will provide Suntech with wafers with an average cost measurably below spot market prices. The delivery of wafers under the contract is expected to begin in the first quarter of 2007.

''This is the fourth long term agreement on wafers that REC has entered into since summer this year. Suntech, one of the fastest growing solar cell and module companies, will become a new valuable strategic customer of REC, and this agreement further cements REC's position as the leading manufacturer of multicrystalline silicon wafers and strengthens our platform for further growth,'' said Erik Thorsen, President & CEO of REC.