First Evergreen Solar decided to close up shop. Now Solyndra has announced that it can't compete in solar panels and is declaring bankruptcy. What gives? Wasn't this supposed to be the era of renewable energy? Weren't we headed for a green energy renaissance that would end America's dependence on foreign oil? The U.S. has a long road ahead if it wants optimistic answers to those questions.
Making solar PV panels isn't as expensive as it used to be, and the entry of Chinese producers into the market on a large scale is making it even more cost-competitive. The American solar industry is now experiencing the kind of global cost pressures that drove automobile manufacturing offshore in the 1970s and '80s. Rock-bottom labor costs and an eagerness to copy effective production methods have driven China to lead the world in solar panel production in just five years.
Ballyhooing a resurgence in U.S. solar exports is probably a short-lived phenomenon, driven by the weakening U.S. dollar. Instead of providing loan guarantees, which both bankrupt companies above were offered in spades, the U.S. government might be better off pursuing anti-dumping complaints against China through the WTO. Ending the oil depletion allowances that give hydrocarbon producers big cost advantages is also worth a look, although it won't do much to improve solar makers' cost disadvantages compared to China.
Nota bene: No positions at all in any solar manufacturers at this time. I had no positions in either Evergreen Solar or Solyndra prior to their troubles.
Making solar PV panels isn't as expensive as it used to be, and the entry of Chinese producers into the market on a large scale is making it even more cost-competitive. The American solar industry is now experiencing the kind of global cost pressures that drove automobile manufacturing offshore in the 1970s and '80s. Rock-bottom labor costs and an eagerness to copy effective production methods have driven China to lead the world in solar panel production in just five years.
Ballyhooing a resurgence in U.S. solar exports is probably a short-lived phenomenon, driven by the weakening U.S. dollar. Instead of providing loan guarantees, which both bankrupt companies above were offered in spades, the U.S. government might be better off pursuing anti-dumping complaints against China through the WTO. Ending the oil depletion allowances that give hydrocarbon producers big cost advantages is also worth a look, although it won't do much to improve solar makers' cost disadvantages compared to China.
Nota bene: No positions at all in any solar manufacturers at this time. I had no positions in either Evergreen Solar or Solyndra prior to their troubles.
