The investment will fund a phased manufacturing and expansion strategy to produce thin-film photovoltaic modules, which use less than 1 per cent of the semiconductor material used in traditional photovoltaic cells.

Under the first phase of the project, Masdar PV will invest $600m in two manufacturing facilities, one in Erfurt in Germany and the other in abu Dhabi. The Erfurt plant will begin operations by the third quarter of 2009, with the Abu Dhabi facility to follow in the middle of 2010.

Together the plants will have an annual output of 210MW, which will be used by photovoltaic system installers in Europe or by Masdar.

Masdar aims to reach 1,000MW of annual production by 2014 through capacity expansions and new plants.