Our government, both the Bush and Obama administrations, pushed ahead with the Solyndra loan guarantees in the hopes that Solyndra with its new and radically different (but perhaps high-risk) technology (copper-indium-gallium-diselenide (CIGS) thin film) that uses less polysilicon than standard panels could help US companies gain a toehold in the solar energy collection equipment industry which is absolutely dominated by the Chinese.
It was thought at the time that given the relative high cost of polysilicon that this could be a disruptive technology and really put the U.S. on the solar energy technology map.
The short sound bite version of what happened was the price for silicon dropped around 80% over a three year period, the Chinese banks were dumping huge amounts of cash subsidies into their solar panel industry and essentially with the price for solar panels falling precipitously as Solyndra was just getting started the revenues they needed just weren’t there and they ran out of money. This chart illustrates just how much backing the Chinese are giving their solar panel companies vs. the U.S. American and European solar companies are faced with an extremely aggressive foe in the global market for solar collection panels.
Solyndra also relied on the idea that the installation of their product would cost less than the more standard solar panel installations but that just didn’t come to pass.
Daniel Poneman, the deputy secretary of Energy, in an op-ed for USA Today wrote:
”…Last year, for example, the China Development Bank offered more than $30 billion in financing to Chinese solar manufacturers, about 20 times more than U.S.-backed loans to solar manufacturers.
Unfortunately, expanding production has coincided with short-term softening demand, a product of the banking crisis in Europe and its wider economic effects. The combination has had a dramatic effect on the price of solar cells, which has plummeted 42% in the past nine months. This has taken a serious toll on solar manufacturers everywhere, including the U.S…
…It underwent years of rigorous internal and external review before being approved — before the perfect storm of deteriorating market conditions.”
The idea that the failure of just one company with a new technology is good reason to concede and surrender the solar market to the Chinese just doesn’t wash with me.
My own take is the government should have taken a more cautious, more rigorous in their approach to reviewing the company’s business model instead of betting on it like a horse in the Kentucky Derby.
Zip, nadda, nothing here changes anything about the seriousness of the problems we face due to global warming.
Is what happend at or in Solyndra a federal crime? Was there real fraud on the part of Solyndra’s executives and backers. I tend to doubt that at this point, I think it was just a risky bet and the track got muddy (the price for silicon dropped) and the Chinese horses Solyndra was up against had a lot more backing. But at least we know there is an investigation underway.
- Five myths about the Solyndra collapse – The Washington Post
- Separating Issues from Myths in Obama’s Solyndra Situation – NYTimes.com
- How China dominates solar power | Environment | guardian.co.uk
- Solyndra: Why did Solyndra fail? – Quora
- Solar poweroff: why did Solyndra fail? | 89.3 KPCC
- Why Solyndra Wasn’t Good Stimulus – Megan McArdle – Business – The Atlantic
- Green jobs stimulus: Why Solyndra’s loan guarantees were in the stimulus bill | The Economist
- Burns Doesn’t See Solyndra Ending Up as Criminal Case – The Washington Post
- Exclusive Timeline: Bush Administration Advanced Solyndra Loan Guarantee for Two Years, Media Blow the Story | ThinkProgress
- Opposing view: ‘Perfect storm’ sank Solyndra – USATODAY.com