Absolicon sells production line to Canada

Absolicon takes an important step on the road to global presence through the sale of a production line to partner Phoenix Solar Thermal Inc., a CEM Company, in Canada for a value of EUR 4 million. The production line enables local automated production of Absolicon's patented solar collectors, which creates added value such as shorter transports, lower prices and locally adapted solutions. This creates competitive conditions for Absolicon's solar technology. The sale includes a pilot installation of 660 m² for hot water application. Production of solar collectors in Canada is planned for 2024.

Absolicon has on 2022-12-22 published a press release on the sale of a production line to PST in Canada. The following is an English translation of that press release.

Phoenix Solar Thermal Inc. (PST) now proceeds with the full purchase valued at EUR 4 million of an Absolicon production line with exclusive rights for marketing, production, and distribution of Absolicon’s solar thermal collectors in Canada and includes a pilot installation of 660 m² for a hot water application. Production of solar collectors in Canada is planned for 2024.

– The sale of an Absolicon production line to Canada shows that the demand for renewable and secure energy supply is global, says Joakim Byström, CEO of Absolicon.

In November 2021, Absolicon and PST have signed a framework agreement on the acquisition of a robotic production line for producing solar collectors in Canada and as part of this agreement, PST has paid EUR 100,000 towards a bank guarantee in the beginning of 2022.

– Phoenix Solar Thermal has successfully developed the Canadian market since we signed the framework agreement and has created a pipeline of potential customers for solar collectors. The Absolicon production line will enable these companies to take part in the transition to clean energy in a faster and cheaper way, says Carlo Semeraro, CSO, Absolicon.

PST is part of the CEM Group, a family-owned thermal power project delivery group of companies. Their focus is on engineering consulting, project development, and construction of custom engineered thermal energy systems throughout North America.

– Over the last 20 years, the CEM Group has built a reputation for successful delivery of thermal power projects through excellence in project development, engineering, and construction. As a member of the CEM Group, PST will focus on the development, financing, engineering, and construction of solar thermal projects for industrial and institutional thermal energy users, says Matt Lensink, the CEO of CEM and the Founder of Pheonix Solar Thermal.

Solar heating market

Half of the world's energy usage is heat, and industries consume huge amounts of fossil fuels to heat their processes. The market for large-scale solar heat is estimated by the International Renewable Energy Agency IRENA to measure at 800 billion euro in investments in industry by 2050.

Absolicon has a unique technology, based on 20 years of research, to extract energy from the sun with concentrating solar collectors. The investment in Absolicon solar heating becomes competitive through local production, limiting transport costs and enabling an adaptation of material choices to the conditions and supply in the local market. The price is also optimized by the solar collectors' patented design, which allows for mass manufacturing and production of solar collectors using Absolicon’s semi-automated production line with the capacity to produce one finished solar collector every 6 minutes.

– Establishing local production for Absolicon’s T160 solar thermal collectors using their advanced semi-automated production line will add a unique capability to the Canadian manufacturing market. PST is well positioned to serve industrial energy users by leveraging its market network access and its strategic location, says Mohammed Murad, PST’s General Manager.

The potential market in Canada, for a production line producing Absolicon T160 Solar collector amounts to 10 million sqm, equivalent to 2 million solar collectors or 5 GWth, reducing CO₂ emissions in the industrial sector in Canada by replacing the use of fossil fuels with clean thermal energy from the sun.  

– We are excited to achieve this milestone with Absolicon. Early feedback from our North American clients has proven a strong interest in applying solar thermal technology towards meeting their decarbonization goals. In the past 9 months we have built a robust pipeline, representing a potential for 151,000 m2 of T160 Solar collectors from various industries and District Energy clients, says Ed Korevaar, PST’s Director of Business Development.                   

The largest market segments for Absolicon’s solar collector technology include:

• Pulp & Paper
• Food & Beverage
• Mining
• Chemicals
• District Energy
• Automotive

Revenue from sales

Absolicon's revenue from sales can be divided into three groups: acquisition of the line, license revenue and revenue from material sales.

1. Sales of the production line

The production line is of the same model as Absolicon has in Sweden and which the company has already delivered to Sichuan province. The line is equipped with two six-axis robots from ABB and has a capacity to produce 50 MW (18,000 solar collectors) per year. Together with the hardware, Absolicon offers consultation support for marketing and technical support, development, and technical training. The value of the sale to PST amounts to EUR 4 million.

2. License to manufacture Absolicon T160

For the right to manufacture Absolicon T160 collectors under Absolicon’s intellectual property protection, take part in future product development and use Absolicon’s trademark, an annual license fee at full production of approximately EUR 4-500,000 sales value.

3. Material supply

Through the agreement, Absolicon ensures access to patented components and high-quality inputs partly manufactured in Canada or locally at the installation site.

At full production, the production line will require the purchase of materials for EUR 3-6 million per year through Absolicon. The outcome for Absolicon depends to some extent on the result of Absolicon’s ongoing material investment.

Next steps

On signing the purchase, the subscription fee of EUR 100,000 made by PST under the framework agreement will be converted to a non-refundable payment. Residual payment of EUR 3,9 million will start within 9 months from first payment following that the buyer has proven its ability to finance the purchase of the production line.

Absolicon expects to deliver the production line within 10 months following second payment. Production of solar collectors in Canada is planned for 2024.

Absolicon Solar Collector AB (publ) was founded in 2005 as a research and development company in solar technology. Today, Absolicon is a listed company with more than ten years of operational experience from all parts of the world.  Absolicon specializes in providing tools for the transition from fossil fuels, providing a profitable, easy-to-install and emission-free energy solution using solar thermalinstallations as well as complete robot production line for the solar collectors.  www.absolicon.com

Phoenix Solar Thermal Inc, is part of CEM Group, a family-owned thermal power project delivery group of companies that is focused on engineering consulting, project development, and construction of custom engineered energy systems throughout North America.

This disclosure contains information that Absolicon is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 22-12-2022 15:35 CET.