Siemens AG will close its solar power unit after struggling to find a buyer following losses of at least 784 million euros ($1 billion) euros since 2011.
The shutdown of the solar division will affect about 280 workers at Europe’s biggest engineering company. Siemens, based in Munich, will finish several solar projects.
The company paid $418 million to acquire Beit Shemesh, Israel-based Solel Solar Systems in 2009 as Loescher sought to replicate Siemens’ successful expansion into wind-power and win more revenue from its so-called green portfolio. The division was put up for sale in October as prices for solar technology offerings declined because of a supply glut and weak demand.
Siemens’ solar operations offered solar-thermal power technology, whereby mirrors in so-called parabolic troughs focus sunlight on liquids to generate steam and power turbines.
The segment has been undermined by plummeting costs in the competing photovoltaic panel sector. Three years ago energy from the latter was 10 percent more expensive than solar-thermal, while now it is less than half as much.
Siemens said today it will complete unfinished solar contracts, which include projects in Spain, where it paid 115 million euros in charges in the three months to the end of December for delays in the sector, before finalizing the unit’s closure.