Solyndra’s technology was so promising that the U.S. government provided $535 million in loan guarantees—whereby taxpayers foot the payback bill to lenders if a borrower fails. And fail Solyndra did: In September 2011 the company ceased operations, laid off all employees, and filed for bankruptcy.
What caused this shooting star of alternative energy to burn out so spectacularly after just six years in business and such a large investment? Part of what made Solyndra’s technology so promising was its low cost compared to traditional photovoltaic panels that relied on once costlier silicon. “When Solyndra launched, processed silicon was selling at historic highs, which made CIGS a cheaper option,” reports Rachel Swaby in Wired Magazine. “But silicon producers overreacted to the price run-up and flooded the market.” The result was that silicon prices dropped 90 percent, eliminating CIGS’ initial price advantage.
Another problem for Solyndra was the falling price of natural gas—the cleanest of the readily available fossil fuels—as extractors implemented new technologies including horizontal drilling and hydraulic fracturing to get at formerly inaccessible domestic reserves in shale rock. In 2001 shale gas accounted for two percent of U.S. natural gas output, while today that number is closer to 30 percent. The result of this increased supply is that the price of natural gas has fallen by some 77 percent since 2008, meaning utilities can produce electricity from it much cheaper as well. “Renewables simply can’t compete,” adds Swaby.
The final blow to Solyndra was China’s creation of a $30 billion credit line for its nascent solar industry. “The result: Chinese firms went from making just six percent of the world’s solar cells in 2005 to manufacturing more than half of them today,” says Swaby. U.S. market share is now just seven percent.
Low natural gas prices have also hurt other renewables, especially given the slow economy and its stifling effect on innovation. To wit, the rate of new wind-turbine installations in the U.S. has declined by more than half since 2008. “The fossil fuel industry and its allies in Congress clearly see the solar and wind industries as a threat and will try to kill [them],” says Representative Edward Markey, a top Democrat on the House Energy and Commerce Committee.
Regardless of the challenges in furthering renewables, the White House remains committed to the greener path. In his recent State of the Union, President Obama renewed the call for a federal Renewable Energy Standard that would force utilities to derive significant percentages of their power from cleaner, greener sources. This would provide much-needed regulatory uniformity and a more robust and consistent market for renewable power, wherever solar panels, wind turbines or other equipment happen to be manufactured.
CONTACTS: Solyndra, www.solyndra.com; Wired, www.wired.com.
EarthTalk® is written and edited by Roddy Scheer and Doug Moss and is a registered trademark of E - The Environmental Magazine (www.emagazine.com). Send questions to: [email protected] Subscribe: www.emagazine.com/subscribe. Free Trial Issue: www.emagazine.com/trial.
For advertising and promotion on HealthNewsDigest.com please contact Mike McCurdy: [email protected] or 877-634-9180
HealthNewsDigest.com is syndicated worldwide and has over 7,000 journalists as subscribers.