It hasn’t been a great month for solar energy. Considering the bad press we’ve noted here about Solyndra and other snowballing media memes, the Solar Energy Industries Assocation (SEIA) has had better days.
But the bigger theme is that it’s been a bad year for solar energy in general, and specifically American solar. Back in 2008 and 2009, the solar markets were on the verge of massive growth. The solar and wind investment tax credits – ITC’s as they’re called in the biz – propped up the burgeoning industries, and the economic conditions made personal solar quite attractive.
So what happened next? Well rather than prices locking up during the global recession, they actually dropped. And in a big way. Costs for solar panels dropped nearly 50 percent between 2008 and now because of massive increases in silicone production capacity. The year President Obama was elected president, global capacity was 15,000 tons of silicon. Now, it’s almost 130,000 tons.
In many ways, that’s a great thing. More silicon means more people can install solar panels on their homes. And with increased supply, more people can afford them, too. It’s finally solar’s time!
Except not quite. Low prices effectively undercut all the solar start-ups that banked on steady silicon prices to recoup their early capital investments. Prices dropping through the floor roils those companies and translates to layoffs. New research in solar technology risks a complete shutdown. That’s what happened at Solyndra in California. It wasn’t impropriety, it was a risky investment undercut by the global silicon market. That’s still not necessarily a bad thing for global solar producers, but it certainly jars the American worker, and our weak economy.
That said, U.S. solar is still in good shape. Last year, the American solar market grew by 69 percent, and U.S. solar capacity now exceeds 3,100 megawatts — enough to power more than 630,000 American homes – which is a new high. Looking to the future, industry analysts expect the U.S. to become the world’s largest solar market by 2014.
It’s enough of a roller coaster, as we note in the title, to give anyone a case of severe whiplash.