Nestled in Sarawak, Malaysia, the OCI Malaysia (OCIM) plant is a beacon of innovation in solar polysilicon production. Just a ninety-minute drive from Bintulu Airport, the facility churns out high-purity polysilicon to fuel the world’s growing demand for renewable energy amid recent legislation moves against forced labor.

OCIM, a Malaysian-headquartered subsidiary of South Korean chemical company OCI Company Ltd., runs the polysilicon plant covering 51.3 acres (equivalent to approximately 98 soccer fields).

The subsidiary‘s focus has been on cost efficiency by tapping into Malaysia’s affordable electricity and labor, as well as Sarawak‘s corporate tax incentives. Electricity costs amount to 5.2 cents per kilowatt-hour, roughly one-third of industrial electricity costs in Korea, and based on a 45-hour work week, Malaysia’s legal minimum wage stands at approximately $450,000 per month. The company is eligible for corporate tax exemptions until it earns 2 trillion won in operation profit.

After buying the plant from Tokuyama Corp, OCIM significantly increased the operation rate, which previously languished below 60 percent. The plant‘s capacity nearly doubled from 20,000 tons to 35,000 tons before being fully operational today. OCIM will inject 850 billion won ($616 million) into additional capacity expansion for polysilicon production to 56,600 tons by 2027.

OCIM’s polysilicon is a non-Chinese brand and an alternative to Chinese polysilicon in response to the United States sanctions on solar panels made of Chinese polysilicon under the Uyghur Forced Labor Prevention Act, a move to take products off the market if they are found to have been made using forced labor. The European Union is also inching toward its first major law cracking down on goods made with forced labor.

Recent data from market research firm PVinsights indicates that the selling price of high-purity polysilicon for non-Chinese products was $20.1 per kilogram as of the fourth week of April 2024, more than triple those of Chinese products.

By Jung You-jung Han Yubin

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]