U.S. Struggles to Build Solar Opportunities

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The competitiveness of the U.S. solar industry was a recurring theme at last week's Solar Power International show in Anaheim, Calif., where speakers talked about the considerable opportunities that lie ahead, but also the need to speak out and take a role in energy policy development

At the Solar Power International show last week in Anaheim, Calif., billed as America’s largest solar event, the competitiveness of the U.S. solar industry was a recurring theme. At keynote sessions, panel discussions and individual meetings, speakers not only espoused the strengths of the domestic industry and markets, but urged other industry participants to make themselves heard and take an active role in government policy development.

In a speech much like a sermon from a pulpit, Rhone Resch, president and CEO of the Solar Energy Industries Association (SEIA, Washington, D.C.), did perhaps the most to try to stir the audience into action, repeatedly eliciting bouts of applause. There are crucial policy battles raging right now in the U.S. Congress, he said, and people throughout the solar industry need to support the efforts by joining SEIA, engaging their policymakers, writing opinion pieces for the local media, and contributing money to the cause. “When it comes to engaging in the major policy battles ahead, we face a choice right here, right now,” Resch said. “There are two alternatives, and two alone: Go big, or go home.”

Resch laid out what he called the Solar Bill of Rights, including such provisions as the right to connect solar systems to the grid with uniform national standards, the right to a fair competitive environment, and the right to equal access to public lands. He was trying to give people something that the entire solar industry could get behind, unifying the industry’s various technologies, he said in a separate interview with PV Society. “And unifies us in a way that points out these aren’t special treatments that we’re getting,” he explained. “These are just the very basic elements of a level playing field. And that we’re not greedy in asking for this.”

Those sentiments were echoed later in the week in a CEO panel discussion about how to survive a possible solar shakeout. “There’s a sense that we have our hand out. That’s ridiculous,” said Tom Werner, CEO at SunPower Corp. (San Jose). The need for incentives is there today, he said, but they will ultimately go away, he said. “They’re required absolutely; we shouldn’t be embarrassed about it.”

“At this moment, the industry depends on government subsidies. It’s very necessary,” said Zhengrong Shi, chairman and CEO of Suntech (Wuxi, China). “For any new industry, it needs a little help.”

China’s Suntech, the world’s leading crystalline-based solar cell producer, has been attracted of late by opportunities in the United States, where it is setting up a new manufacturing plant. Suntech has also launched a solar product specifically designed for the utility market — a market that will be a very important one in the United States.

In a meeting with Gintech Energy Corp. (Taipei, Taiwan) and its subsidiary Apos Energy Corp., executives talked about the growing attractiveness of the U.S. solar market and its sizable utility opportunities. “In Europe, a solar project that’s 1-2 MW is big,” said Jason J.Y. Hsieh, Gintech’s senior vice president of international business development. “But in the United States, it’s more like 50 MW.”

The United States will likely see a lot more utilities jumping into the solar market in order to comply with government mandates, according to Reese Puckett, a regional sales manager for Advanced Energy, which supplies inverters to the market. But it may be a steep bell curve, as they build up what’s necessary to comply, and then consider it enough, he said.

More to be done

The country still has its work cut out for it to make solar energy competitive. One recent success has been the recent passage of a bill by the U.S. House of Representatives that creates an updatable strategic roadmap to advance solar energy technologies through prioritized research, development and demonstration (RD&D) activities, with government funds going to the Department of Energy (DoE) to carry out solar activities.

The Solar Technology Roadmap Act (H.R. 3585) establishes a comprehensive process to create the roadmap for RD&D activities conducted by the federal government in partnership with the private sector. In particular, the bill authorizes $350M for the DoE to carry out these activities in fiscal 2011, rising to $550M in fiscal 2015.

But the House bill, endorsed by SEIA among others, is only one step in any possible final action, Resch explained. It still needs a companion bill in the Senate, which does not yet exist. It would then need to pass out of the Senate and on to an appropriations committee, where funds could be cut back significantly.

“We appreciate the leadership of Congresswoman [Gabrielle] Giffords and others on the committee to push this forward,” Resch said. “The real challenge now will be getting it appropriated by the appropriations committee.”

There are other battles raging in congress right now that are crucial to the U.S. solar industry, Resch noted in his conference keynote, including:

• A national renewable electricity standard (RES) of 25%, and other standards to guarantee solar growth.
• A national cap and trade program that allocates 10% of carbon credits to states to fund renewable energy (RE) and energy efficiency (EE).
• Measures to support the construction of new transmission.
• Long-term power purchase agreement (PPA) authority for the federal government.
• Clean Energy Deployment Administration (clean energy bank) to provide a suite of financing options.

Although the solar industry has had “probably the best 18 months of legislative victories than any other industry in Washington,” Resch said, the industry still needs a wakeup call regarding the challenges it faces, as well as the opportunities that lie ahead, which was the driving force behind his impassioned keynote speech. “If we want to be successful — and we will be successful — this is how we do it,” he said. “We work together; we work in a concerted fashion. Everybody is active and engaged so we contribute to the pack, and we support those who support us.”

The U.S. solar industry has had considerable policy successes in the past year, including a long-term extension and expansion of the Investment Tax Credit (ITC), and a provision to make the ITC refundable for companies; a new loan guarantee program; a removal of the tax penalty for subsidized renewable energy financing; more solar on federal property, with $5.5B in appropriations to install solar on federal buildings; an increase in solar appropriations for the U.S. Department of Energy (DoE); and more funding for green collar job training.

Nonetheless, America’s solar industry cannot afford to be satisfied or complacent, Resch said. “These successes are lifting our industry during a year when economic forces were pressing us down. But our work is not finished, and we aspire to win far more than the policy battles of a single year,” he said. “The fights ahead will surpass any we have seen so far — and so will the victories, if we work together.”

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