REC Silicon Adjusts Polysilicon Inventory Goals Amid Market Challenges

REC Silicon

Norway-based REC Silicon has revised its goal for clearing its inventory of semiconductor-grade polysilicon. Originally aiming to clear it by the end of 2024, the company now expects to meet this target by mid-2025 due to low demand in the market. As part of its shift to focus on silicon gas production, REC has been adjusting its production strategies, including halting polysilicon production at certain facilities.

Shifting Focus to Silicon Gas Production

REC Silicon, which produced semiconductor-grade polysilicon in Butte, Montana, and solar-grade polysilicon in Moses Lake, Washington, faced challenges that led to the closure of its Butte plant in mid-2024. High electricity costs and weak semiconductor demand were the primary drivers behind this decision. Additionally, REC ceased production at its Moses Lake facility due to the difficulty of achieving the high purity required for polysilicon used in solar cells. As a result, the company is transitioning to focus exclusively on silicon gases, which are essential for semiconductor and solar panel manufacturing.

The long-term strategy for REC involves increasing its supply of silicon gases to semiconductor manufacturers, with a notable projection for US semiconductor production to double between 2022 and 2032. The company is also expanding its role in the solar industry, as domestic solar cell manufacturing capacity is expected to increase by 1,300% over the coming years.

New Opportunities in Silicon Battery Anodes

In a major strategic shift, REC Silicon plans to start supplying silicon gases to Sila Technologies, a company that produces silicon battery anodes, in the second half of 2025. This partnership will be a significant part of REC's new focus on silicon gases, as the company is currently in discussions with six other silicon battery anode manufacturers. As electric vehicle production continues to grow, carmakers are seeking alternatives to traditional lithium-ion batteries with graphite anodes.

The Butte plant is equipped to produce 7,400 tons per year of silane and other silicon gases, while the Moses Lake facility could reach a production capacity of 24,000 tons per year. The company is keeping the Moses Lake facility operational to ramp up production when market conditions improve.