Dear EarthTalk: First Solyndra went under, then SunEdison… If solar energy is growing so much in the U.S., why have some of the bigger players gone under and will the survivors be able to stay the course?
—Scott Marcinik, Altoona, PA
No doubt, solar power is surging. The trade group Solar Energy Industries Association (SEIA) reports that our domestic solar power capacity has seen a compound annual growth of nearly 60 percent over the last 10 years. Meanwhile, solar accounted for 28 percent of all new power added to the U.S. electric grid in 2015 and the prices of photovoltaic panels have fallen so steeply that solar is now cost-competitive with coal or natural gas in some parts of the country. And there’s no sign of solar slowing down anytime soon.
But just because Americans are warming up to solar doesn’t mean that every company looking to lead this power revolution has been able to manage the growth and navigate the tricky world of shifting subsidies and incentives. The most infamous case of a solar company flare-out is Solyndra, a California-based start-up that was pioneering the design and manufacture of thin film photovoltaic cylinders and secured $545 million in federal loan guarantees from the Obama administration’s economic stimulus package.
“But a solar manufacturing boom in China crushed the price of conventional crystalline photovoltaic (PV) solar panels,” reports David Ferris and Saqib Rahim in EENews’ EnergyWire. “The economic rationale for Solyndra’s pricey tubes was undermined, and the company declared bankruptcy in August 2011.”
Solyndra’s demise was certainly an embarrassment to the Obama administration, which had been touting the company as an example of the direction we should be heading in our energy sector, and augured poorly for the future of the still nascent green economy. But despite the setback, solar has grown at a record clip since 2011, surpassing wind as the largest renewable energy source in California.
This very maturation of the solar power industry in the U.S. made the April 2016 news of the bankruptcy of SunEdison, one of four remaining big players in the American solar industry, that much more surprising, given that the company was much larger in employees and revenues than Solyndra and had received more federal subsidies and loan guarantees overall.
“SunEdison’s bankruptcy, for creditors, customers, shareholders and partners, is a very big deal with all manner of negative repercussions,” comments Clint Wilder of the clean-tech advisory firm Clean Edge, “and it’s a cautionary tale like those we’ve seen across the energy landscape and in other industries, where over-leveraged, aggressive growth strategies can come crashing down.”
Meanwhile, America’s remaining solar powerhouses—SunPower, SolarCity and First Solar—continue to expand judiciously. And hundreds of smaller players are working to shake up the industry even further and keep the bigger players on their toes. While the growing pains for America’s solar industry are far from over, the future still looks bright for solar power specifically and renewables of all kinds.