Japan's Sharp Corp said it will set up a joint venture with Enel and STMicroelectronics by March to make solar cells in Italy, in a bid to further tap the strong growth potential of renewable energy sources.

Consumer electronics maker Sharp and Italian utility company Enel in 2008 announced their intention to make thin-film solar cells with a European manufacturer, but they did not identify the third company. The venture plans to start producing solar cells in early 2011 at STMicroelectronics' existing facility in Sicily at an initial output capacity of 160 megawatts a year, which will eventually be raised to 480 megawatts. In addition to bank loans, each of the joint venture partners will invest up to 70 million euros in the project, Sharp said in a statement. The venture will be owned a third each by Sharp, Franco-Italian chip maker STMicroelectronics and Enel Green Power, an Enel group company. Sharp and Enel Green Power will also set up another joint venture to generate electricity using solar panels manufactured by the three-way, solar panel-producing joint venture. The Sharp-Enel Green Power joint venture plans to set up power plants with a total capacity of more than 500 megawatts by the end of 2016, Sharp said.

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