Suntech Power Holdings has signed a contract to supply solar modules for what it says will be the world's largest solar power plant.

The company said it will supply solar modules with an aggregate output of 23.2 megawatts to Atersa, a subsidiary of Elecnor Group. The modules will be installed in the Photovoltaic Grid Connection Park in the Extremadura region of Spain. It is expected Suntech will supply the modules within the first half of 2007.

Resource Library:

Financial terms of the agreement were not disclosed

"Atersa has broad experience in energy integration products and we are pleased to be able to work with them to build this Photovoltaic Park," said Dr. Zhengrong Shi, Suntech's chairman and CEO, in a statement. "With Spain's recently enacted feed-in-tariffs and a climate favorable to solar energy production we expect that Spanish demand for solar products will grow rapidly in coming years. Suntech aims to be a long term provider of quality PV products in Spain and this project is a critical part of that effort."

Suntech's sales in Spain have already grown to account for nearly 12 percent of total revenue in the third quarter of 2006, and company officials said this project will greatly increase Suntech's presence in this market. On Nov. 20, the company reported a net profit of $28.7 million in the third quarter—more than triple its net profits from the same period last year.

The Elecnor Group is one of Spain's leading companies in the field of project planning and integrated management and infrastructure development, and it operates in a variety of areas including energy and telecommunications.

Pramodh Panchanadam, an energy industry analyst for Frost & Sullivan, cautioned that while there is a definite market for solar energy in Spain, it may not grow as fast as some predict in part because of layers of government red tape.

"Spain is a very bureaucratic country," he said, adding that the market there would benefit from more government incentives to build large solar facilities.

According to Suntech, the Photovoltaic Park will cover an area of 65 hectares and have more than 120,000 solar modules once it is completed.

"After a careful evaluation of potential partners and suppliers for this landmark Photovoltaic Grid Connection Park, we chose Suntech as we were highly satisfied with the value and quality of their product," said Virgilio Navarro, Atersa's CEO, in a statement. "We look forward to working closely with Suntech as part of this project."

Check out eWEEK.com's for the latest news, views and analysis on servers, switches and networking protocols for the enterprise and small businesses.