updated 10/18/2008 3:42:41 PM ET 2008-10-18T19:42:41

In the thick of Oregon's "silicon forest" and far from his home in Germany, SolarWorld founder Frank Asbeck walked through his company's newest plant Friday with the excitement of a child in a toy factory.

"This is like my playing field," said the 49-year-old Asbeck as he walked down a quarter-mile-long corridor and passed machines converting chunks of silicon into crystals. "Our parents didn't buy us enough toys when we were little."

The $440 million plant, which opened its doors Friday, covers 480,000 square feet. SolarWorld, with headquarters in Bonn, says the plant will make the company North America's largest solar cell manufacturer.

By 2011, the Hillsboro facility is expected to make enough cells to generate 500 megawatts of electricity a year, about as much as many coal- or natural gas-fired plants.

Oregon has become an attractive site for renewable energy companies largely because of the state's Business Energy Tax Credit, often pronounced "Betsy" for its abbreviation, BETC.

So far, it has provided $20 million in tax credits for SolarWorld, said Michael Grainey, director of the state's energy department.

The Legislature in 2007 made solar energy manufacturers eligible for the credit, Grainey said.

Gov. Ted Kulongoski, who toured the plant Friday, called the tax credit a "short-term investment" for the state that will create 2,000 high-wage jobs while other manufacturing plants cut back and the nation struggles through a steep economic downturn.

Other companies investing
Officials say six solar manufacturing companies have announced plans for projects in Oregon in the last 18 months, making a state with a reputation for cloudy skies much of the year something of a solar belt for the sustainable energy industry.

"When we talk about solar energy, our state is not always the first place people think of," said Sen. Ron Wyden, who was also at the plant Friday. "But when you are talking about climate and solar energy, it's the business climate that counts."

Ron Pernick, co-founder of the Portland-based research group Clean Edge, said there are signs the national business climate for solar energy will warm as fuel costs for coal, natural gas and nuclear plants increase and solar panels become more affordable.

Provisions tucked into the $700 billion financial rescue package recently approved by Congress are likely to make sustainable energy investments more attractive, too.

Solar energy tax credits for businesses and homeowners were set to expire Jan. 1, but were extended for eight years when the rescue package was approved.

The solar industry says extension of the credits through 2016 would produce an extra 440,000 jobs and more than $230 billion in investments.

"Those nations that have really succeeded with solar have made a long-term commitment," Pernick said. "Now, the U.S. is back in the game."

A recent Clean Edge study predicts that by 2015 the cost of solar equipment will be no greater than the cost of conventional energy sources.

Asbeck said several other factors in addition to the state's tax credits helped draw the company to Oregon.

The company, for example, saved two years by moving into the facility built as a semiconductor wafer plant by the Japanese manufacturer Komatsu but never put into production, he said.

Intel nearby
The company also took note of the Portland area's technology-based work force drawn by companies like Intel Corp., a neighbor in Hillsboro, a Portland suburb.

The California-based computer chipmaker began operations in Oregon more than 30 years ago and has expanded its presence into the single largest industrial employer in the state.

"We don't need hands," Asbeck said. "We need brains."

SolarWorld spokeswoman Jennifer Cloer said the plant has 250 employees and expects to reach 1,000 in three years.

The five-inch-square cells made at the Hillsboro plant will be shipped to a SolarWorld plant in Camarillo, Calif., for assembly into solar panels.

As in the computer industry, a flawless product is crucial.

The solar plant's stark white hallways smelled of fresh paint Friday, and the factory workers were clad all in white, from hair covers through scrubs-like suits down to the foot covers.

"We have to have a very clean product," Asbeck said over the hum of the machines. "If you have impurities in there, then the product isn't any good."

Asbeck said a Solarworld solar panel capable of producing at least one kilowatt of energy will cost about $5,000 at retail.

"One kilowatt will give me the power I need for the next 30 years," he said. "Compare that with your car."

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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