The first-ever collaborative project between Hong Kong and Shenzhen to create solar cells for power generation will come to an end this year after a subsidiary of American chemical giant DuPont pulled out.
The project's end came with the announcement from DuPont's local subsidiary, DuPont Apollo, that it was stopping production in the region of silicon thin-film modules, which are used in solar cells.
That dealt a blow to cross-border efforts to establish the region as a hub for the research, development and production of solar power technology.
The partnership, called the Shenzhen-Hong Kong Innovation Circle, sought to create research and development facilities in Hong Kong for the technology that would be manufactured in Shenzhen. It was established in 2008 at the invitation of the Hong Kong and Shenzhen governments as part of the central government's 11th five-year plan.
Thin-film solar cells use thin photovoltaic material, such as might be found on a solar calculator, deposited on a substrate.
DuPont Apollo had aspired to become one of the world's top three providers of thin-film photovoltaic modules by next year. Its versatile thin-film products were cheaper to produce as it uses much less silicon than rival crystalline panels.
In 2009, it still expected the photovoltaic market to grow exponentially. But a year later, an oversupply of silicon lowered the prices of rival modules, making the technology less competitive.
DuPont Apollo ran the project's production facilities in Shenzhen and a research and development centre at the Hong Kong Science Park in Tai Po.
News of the closure came as Chief Executive Leung Chun-ying was seeking support for a technology bureau to take charge of the city's lagging hi-tech and science development.
DuPont Apollo chairman Chuck Xu Chengzeng cited a flagging market for the decision to pull the plug on the project.
"The state of the silicon thin-film solar module market segment has changed dramatically in recent years and market conditions for this segment continue to deteriorate," he said.
Expressing regret over the decision, a spokeswoman for the Science Park said: "We understand and respect this tough business decision made against the backdrop of technology shift and the extremely challenging climate for amorphous thin-film solar module manufacturers."
She said DuPont Apollo would hand back the research and development facility, opened in 2009, to the Science Park when the lease expired in August. About 100 scientists and engineers would be transferred within the group or paid to leave, a person with knowledge of the operation said.
The production facility in Shenzhen, which came into full operation in 2010, will be suspended but the person believed the factory might be modified for new uses.
DuPont Apollo boosted its nominal and paid capital to HK$804 million from HK$664 million in January. The extra shares were issued to DuPont China.