Elon Musk, chairman of solar installer SolarCity, announced Tuesday that the company will buy solar panel maker Silevo and build new factories.
The San Mateo, Calif.-based company said the deal will help it produce efficient, low-cost panels in large volumes, according to USA Today.
"If we don't do this, we thought there was a risk of not being able to have the solar panels we need to expand our business in the long-term," Musk said in a conference call.
SolarCity is in discussions with the state of New York about building one of the world's biggest solar panel factories within two years. The factory would have an annual capacity of at least one gigawatt.
The company is one of the largest installers of rooftop solar systems in the U.S., ABC News reported. It also bought a company last year that makes mountain systems used for holding panels still.
Terms of the acquisition have not been revealed.
Musk, also CEO of Tesla Motors, is planning a similar move with his goal of building a "gigafactory" for producing batteries that will power the automaker's cars, USA Today reported. He said that because the sun radiates more energy in a few hours than a year, solar panels, with batteries that provide energy, will be able to meet demand for electricity around the world.
"This is the first time that a distributed solar installer has bought a panel manufacturer," said Shayle Kann, vice president of research at GTM Research. "It's a potentially revolutionary move, but it's contingent on SolarCity hitting its production and cost targets for the manufacturing plant."
SolarCity said it wants to build panels in huge factories so it can reduce the overall cost of solar electricity. Silevo makes panels that generate more power per square foot than average panels, ABC News reported.
Musk is looking to make attractive panels that will get more homeowners interested in solar energy.
"We want to have a cool-looking aesthetically pleasing solar system on your roof," he said.
