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Netteligent
Solyndra management and Board of Directors are disgrace to America and betraying ...
george.leopold
I agree about China needing our R&D, Dr. Divakar. My fear is that Beijing has ...
Picking up the pieces after Solar-gate
George Leopold
9/15/2011 8:21 PM EDT
With the high-profile collapse of solar manufacturer Solyndra, the demise of the U.S. solar industry is nearly complete.
Let’s face it, the largely justified but calculated partisan attacks on the Obama administration’s funding of the California solar startup, along with the domestic industry’s persistent inability to compete with heavily subsidized Chinese manufacturers, likely kills the chances of nurturing a domestic solar industry.
It didn’t have to turn out this way.
Nevertheless, U.S. companies involved in producing materials and other solar components are voting with their feet. Big suppliers like Applied Materials and smaller startups such as Evergreen Solar have shifted operations to China. Massachusetts-based Evergreen laid-off 800 workers last winter and shifted production to a joint venture in China. Evergreen’s excuse? More Chinese government support.
Solyndra’s collapse after receiving a $535 million government loan, which taxpayers will now have to pick up, will likely undermine economic stimulus efforts designed to boost the domestic solar industry. Smaller U.S. operators will remain, but most manufacturing—and jobs—are gone to China.
U.S. oil companies are laughing all the way to the bank.
The House Energy and Commerce Committee appears to have the goods on the Solyndra loan, including a raft of White House e-mails the panel leaked to the Washington Post. That newspaper appears to have at least done some leg work, reporting that Solyndra’s biggest investors were funds controlled by billionaire and Obama campaign fundraiser George Kaiser. Kaiser has denied any undue political influence in gaining approval of Solydra’s government loan.
The main culprit in Solar-gate is Solyndra CEO Brian Harrison, who failed to inform even committee Democrats of his company’s “perilous condition” prior to its collapse. As Harrison exited by the back door, the feds were carrying boxes of documents out the front entrance as most of the Bay Area’s TV stations captured the proceedings.
The Republican leadership of the House energy panel is and always has been hostile towards solar energy development. It also views the Obama administration’s economic stimulus efforts as picking “winners and losers.” That tired debate is irrelevant as American manufacturing continues its precipitous decline.
(A sliver of hope remains for the domestic industry: Despite all the hoopla over Solyndra’s collapse, the Energy Department is continuing to invest in promising energy technologies, including a $150 million loan guarantee to 1366 Technologies. The company has found a way to use bulk silicon to make wafers used in solar cells. The process technology is close to commercialization. DoE is betting the advance can lower the cost of producing solar cells. “It’s a process innovation, not a product innovation,” a DoE official told the New York Times. “They can produce silicon wafers with much less material and many fewer steps.”)
If the American solar energy industry is in fact on its death bed, where can we still lead in energy R&D and manufacturing? I would argue that the best place is battery technology. Several U.S. companies and a growing list of startups are either squeezing more energy density out of lithium-ion batteries or targeting new combinations like lithium air. Venture capitalists are pouring a sizeable amount of money into these companies, many of which are spin-offs from university labs. Despite all the gloom, there are still plenty of good ideas emerging from these technology incubators.
The solar industry has picked up and moved to China. Let’s mourn, then organize, and refocus our efforts on other energy technologies like advanced batteries--and begin again to restore U.S. manufacturing and energy independence.
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agk
9/16/2011 5:45 AM EDT
The process innovation by Solyndra to use the bulk silicon to make wafers used in solar cells in a cost effective way may bring light on US solar cell manufacturing
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george.leopold
9/16/2011 10:23 AM EDT
The silicon wafer process technology is being developed by 1366 Technologies. Solyndra is finished.
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KarlFredrik
9/16/2011 7:08 AM EDT
A stupid question from someone that isn't into trade regulations.
Why are chinese companies allowed to sell their produce in europe and the US if they are so heavily subventionized?
The subventions in the western world seem to be directed toward the consumer. In China it's the producer. Naturally, if the chinese company get to borrow money for a very low interest, is given free land to build factories on and don't have to pay any taxes for many years while western companies have to, then the production will be taken over by chinese companies since it get's more or less impossible to compete for western companies.
The argument for free trade make much more sense in a world without producer subsidies in my mind.
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george.leopold
9/16/2011 10:28 AM EDT
Part of the reason that China gets away with heavy subsidies for strategic industries is that it is still treated as a "developing nation" under international trade rules. Given the fact that it is now the world's second largest economy, and given Beijing's failure to clean up its act on intellectual property rights, arguing that China is a "developing nation" is a stretch.
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rick.merritt
9/16/2011 11:05 AM EDT
I heard yesterday that China is now the world's #1 car market and cellphone market and this year will be the top PC market. Sounds pretty well developed!
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KevinCBaxter
9/16/2011 12:45 PM EDT
What we are seeing in the Solar world has already come to pass in the LED world, complete dominance in manufacturing by the Chinese even as we continue to add improvements in process or the core technologies.
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raildoc
9/16/2011 1:47 PM EDT
Even techies should know that free market economics determine both financial--and techical--success. As former a "rocket scientist", I saw that the Apollo program did not have the governmental and political meddling that the solar industry seems to want. Manufacture off-shore: of course, with U.S. unionization, taxes, and regulation, why not? American real value is in R&D, innovation, venture capital investment, and start-up manufacturing--not to mention advanced services and technical infrastructure support. Get off the dole!
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gkidwell
9/16/2011 2:50 PM EDT
I'm not an Obama supporter but strangely I have very little problem with this investment. In general I'm not opposed to investment in promising new technologies that might have some impact in reducing our dependence on oil. Probably due diligence was not applied in this case, I'm sure it will all get exposed, but hey look at all the VC money that gets invested and never returns a dime. Investments in start up companies is risky period.
That said I think to truly spur the solar market, the government instead of being in the VC business should be helping on the consumer side, by providing substantial incentives to homeowners and making it illegal for HOA's to block solar panel installations.
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KelleyR
9/16/2011 4:36 PM EDT
Interesting and chilling comment, but would it be possible to add some facts to this? You say the the reason companies are moving to China is "More Chinese government support." More than $535 million in loan guarantees? Can you provide specifics as to the type and amount of support the Chinese government is supplying or are they simply up to their old tricks: You can't sell in China unless you build in China. If that be the case, no amount of subside is going to change this outcome. What will change the outcome is a tit for tat approach - tell these companies that they cannot sell in the US unless they build in the US.
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KarlFredrik
9/17/2011 5:18 AM EDT
Here's an article from New York Times that goes through chinese support systems:
http://www.nytimes.com/2010/09/09/business/global/09trade.html
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DrQuine
9/18/2011 10:56 AM EDT
Development of innovative technologies is an inherently risky business (even excluding the possibility of fraud). If investments are placed on many promising technologies, we can hope to develop some ground breaking solutions. With technical and financial due diligence, we hope to invest in the most promising opportunities. Without the effort, we can be assured that more innovation will migrate elsewhere.
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elctrnx_lyf
9/19/2011 12:50 PM EDT
Is the US economy is coming down every day because the technological innovation is not as good as before. It is particularly because there is no break through technologies evolved in electronics industry which is dominated by US till now.What wonders me will US ever come back to become a leader.
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antiquus
9/19/2011 1:59 PM EDT
If "American real value is in R&D, innovation, venture capital investment, and start-up manufacturing", then...
The U.S. government should invest in patents, and release those into the public domain. Get the lawyers out of the way, and let innovation happen.
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sharps_eng
9/19/2011 3:04 PM EDT
@antiquus: Are you saying that US patents are not in the public domain?
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antiquus
9/20/2011 4:18 PM EDT
I'm saying that we are not free to implement with them. Innovation in and of itself does not create jobs.... building things creates jobs. The government should buy patents, paying good money to the inventor, and then let the building begin.
So much of the "patent" issue revolves around defensive patents: pieces of paper that are used to counteract attacks from people that have other pieces of paper. Many of those arguments go on until the "innovation" is irrelevant, and the lawyers retire.
If businesses were free to use, say, the DDR interface without royalties, litigation, or the need to create bulwarks of useless patents, they would be in a position to roll out new products as fast as they could hire people to build them.
The government should have a technical council that identifies truly significant innovations, and rewards the inventor. Patent trolls would simply disappear as those innovations go immediately to the good of the general public.
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docdivakar
9/21/2011 1:59 PM EDT
@antiquus: you make some valid points above. Much of what patents reveal is really what they try to prevent others from building similar products. Even those 'skilled in the art' will waste many hours/days tryiing to design around & avoid getting lawyer's notices -an awful waste of time! That time could be devoted to true innovation.
I would argue upwards of 80% of the patents are an awful waste of every one's time not to mention USPTO's resources!
MP Divakar
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docdivakar
9/21/2011 2:08 PM EDT
@George Leopold: US can still lead in energy R&D, manufacturing efficiencies, energy efficiency R&D (where it is making much progress) and marketing of clean technology.
As you say, the demise of the U.S. solar industry may be nearly complete but I think there is plenty of R&D efforts to expended to improve efficiency. The question is who is going to fund these, if not the US/DoE, the Chinese industry? After all, the Chinese do need the US R&D ecosystem...
Dr. MP Divakar
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george.leopold
9/22/2011 8:20 PM EDT
I agree about China needing our R&D, Dr. Divakar. My fear is that Beijing has the resources to cherry-pick the best of it and move the fruits of our R&D to China. In other words, the U.S. needs a manufacturing policy.
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Netteligent
10/23/2011 6:15 AM EDT
Solyndra management and Board of Directors are disgrace to America and betraying our trusts. We must prosecute the crooks. Politicans are only do whatever it takes to benefits them.
We should not let a rotten Apple to ruin our chance for advanced technology and solutions. China and India are effectively leverage and take advantages of the situations. All of our efforts are gone along with battery industry as well, at our risks and expenses. Do not discourage.
Current administration has nothing but great intention and purposes, not for their own benefits.
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