Amoco Corp. said yesterday that its Frederick-based Solarex Corp. solar power cell unit will merge with the solar business of Enron Corp. of Houston and that the joint venture will begin a search for a location for a new manufacturing plant.
The new venture, called Amoco/Enron Solar, will be headquartered in Frederick. Each of the two corporate parents will own 50 percent, Solarex spokeswoman Sarah Howell said. Enron spokeswoman Diane Bazelides said no cash will change hands in the merger, which is to take effect Jan. 1.
The merger will not have an immediate major impact on Solarex's Frederick facility, which employs about 230 people. Ms. Howell said the transaction has no impact on plans to receive a $3.7 million state loan package that will help fund a $7.7 million expansion plan for the plant.
Solarex, which makes solar energy collection modules, has between $30 million and $35 million in annual sales. Amoco's annual sales are about $28 billion.
Mark L. Wasserman, secretary of Maryland's Department of Economic and Employment Development, said the loan package announced Oct. 10 included Solarex's assurance that it would keep its headquarters in the state.
Solarex also pledged to move researchers now based in Pennsylvania to Maryland to work on both conventional solar technology and more cutting-edge "thin-film" technology, and to expand its manufacturing facility for conventional solar cells, Mr. Wasserman said.
Ms. Bazelides said Enron's solar business consists mostly of a market research operation. But she said the company has a proposal pending before the U.S. Department of Energy to build a new plant to make solar cells and to place the cells in a "solar farm" in Nevada to generate power for sale to the department.
The deal received the blessing of the Clinton administration. Christine Ervin, assistant secretary for energy and renewable energy, said the deal is an important part of searching for a way to reduce the cost of solar power production by encouraging high-volume production of solar electricity.
The new plant, which Ms. Bazelides said is the same plant proposed in the application for federal funding, would produce enough solar cells annually to produce 10 megawatts of electricity. Ten megawatts, while high volume by the standards of the tiny solar power industry, is still much less power than produced by even the smallest conventional utility plants.
Ms. Howell said the solar farm would take up to 15 years to come fully on line.
Both companies' spokeswomen said the company has no location in mind for the plant.