Norway-based polysilicon manufacturer REC Silicon is ceasing polysilicon production at its Moses Lake, Washington facility in the U.S.

The facility’s shutdown follows multiple improvement efforts for critical impurities resulting from the company’s post-reactor finishing and handling systems.

REC said it had engaged third-party resources to evaluate and mitigate the impurities.

The company said it employed multiple initiatives to improve product quality, including changing contact materials, procedures, operating conditions and parameters, passivation measures, and bypassing . However, the Company was unsuccessful in its attempts to fully rectify the issues and ultimately received an unsuccessful qualification test, as announced on December 17, 2024.

High operating fixed costs, uncertainty regarding the timing and quantifiable success of improvements in the product handling process, and lack of customer base availability drove the facility’s shutdown.

The company said its single U.S.-based customer could not wait any longer for REC to consistently provide polysilicon to meet its needs. Additionally, REC has limited customers outside China and is currently not considering them as an option for continuing its polysilicon business.

REC said it is in advanced discussions with the U.S. customer on canceling the contract, including the elimination of any penalties and deferral of the initial pre-payment repayment.

It is seeking additional financing options for support during the transition period and funding for the shutdown process. The company is also negotiating with its largest shareholder for a potential short-term loan.

REC said it plans to increase its focus on silicon gas production. The company aims to prioritize reducing costs in its silicon gas assets and optimizing production to become profitable.

The company plans to maintain the equipment involved in the production of silicon gases in a safe and recoverable mode to restart the unit after reasonable notice and retain the flexibility to fulfill future demand for silicon anode or other gases.

In February 2024, REC Silicon announced its plans to shut down the polysilicon production in its Butte, Montana, facility because of high electricity costs. It shut down the Butte facility because of primarily mid- to long-term viability concerns.

REC Silicon’s net loss widened 112.09% year-over-year to $52.6 million in the third quarter of 2024 from $24.8 million due to the suspension of Moses Lake and Butte Montana facility.