ZENblog

WHAT'S NEW UNDER THE SUN

Gary M. Kaye, Publisher, Zero Energy News

The Solar Industry is certainly coming of age.  Despite the economic meltdown, the Solar Power International 2008 conference in San Diego was a hotbed of excitement. What's billed as the largest solar industry event in the Americas claimed some twenty thousand attendees.  The full conference program sold out.  And the exhibit floor was crammed with the latest and greatest.  There were some 425 exhibitors, and while another 400 plus companies tried to get in, but couldn't.

Coming as it did on the heels of the eight year extension for investment tax credits, that was reason enough for the industry to feel reinvigorated.  From my perspective, there was far more attention on industrial and utility scale solar, and less on the residential installers of PV and solar thermal.  But given the dramatic jump in energy prices (and now slide) over the past year, coupled with the tanking of the homebuilding market, there were few surprises. 

Perhaps it was my own perspective, but I certainly got the sense that there was an air of invevitability about the success of the solar industry.  Never mind that some, perhaps many, of the exhibitors on the floor at this year's conference will be a footnote to history in another year or two.  Never mind that the housing market may not have even hit bottom.  This is an industry that has been growing by 40% a year over the past five years.  And the promise is that now with longer term tax credits in place, growth will simply accelerate. 

But, throughout it all the economic collapse looms like a dark cloud.  The collapse of the housing market has already beaten down new solar installations.  At Borrego solar,  their mix  has gone from a balance of fifty-fifty residential and commercial to almost 80 percent commercial.  Installers of residential solar confessed that many of their funding sources have dried up, making it very difficult to help homeowners with long term PV financing.  Companies like SolarCity are using leaseback programs, Open Energy is using Power Purchase Agreements, almost anything to help cash strapped homeowners put solar on their roofs without having to front the money.

At the same time utilities are increasingly adding concentrated solar to their power generation mix.  This week, Ausra will throw the switch on a new plant near Bakersfield, California.  On the show floor, a host of companies showed off utility scale soutions, from SkyFuel to GreenVolt and many others.  But even here, there's a concern that a dramatic slowdown in economic activity in the U.S. will force utilities to reassess their needs for new generating capacity, even if the fuel is free.

All in all,  it's a great time for solar.  But despite the celebration of the tax credit extension,  there was certainly more caution in the hall than I heard just a year ago.

Like Christmas in October

by Gary M. Kaye - Publisher, Zero Energy News

When I called Rhone Resch, the President of the Solar Energy Industries Association, shortly after the House of Representatives had approved an eight year extension of the renewable energy tax credits, his office sounded like Christmas in October. And for good reason. Solar and Wind industry representatives have been working for two years to get these tax credits extended. Ironically, a vast majority of members in both the House and Senate agreed that this was something that needed to be done. But for the better or worse part of two years they couldn't agree on a way to pay for them. Ultimately various versions had passed each chamber of Congress, but never in the same form. It took the biggest financial crisis in modern American history to get them approved, and then essentially as an afterthought.

There is plenty at stake here. First, there's the whole question of energy policy. You remember energy policy, something which our national leaders all agreed we need, included the development of renewable energy. But, as they say, "the devil was in the details". Can you imagine how, with gasoline still not all that far below four bucks a gallon and heating oi and natural gas prices still on the rise, this Congress could have gone home and not extended these credits? Every kilowatt of electricity generated by renewables takes that much pressure off fossil fuel driven plants, whether they be driven by oil, or even good old American (air polluting carbon emitting) coal.

The second part of this has to do with the economy, stupid. There are estimates that renewable energy could be one of the biggest sources of new jobs creation in the next decade. Hundreds of millions of dollars are poised to be invested in solar and wind. And all of this economic activity could have been slowed considerably had these tax credits not been extended. The mind boggles. Now, at a time when our economy is in deep trouble, at least we can look forward to substantial investment in renewables. Just as the computer industry in the 1980's saved us from the loss of heavy industry, the renewables industry stands poised to save us from the fallout of the mortgage mess. Even better incorporation of these new technologies into homes and commercial business, could help turn the real estate and housing industries back onto an upswing.

Yes, Congress did the right thing. But this was legislation by default, not the fault of the obvious necessity. Next time we just might just fall off the cliff.