Solar executives speak of turmoil in the industry

Solar Industry ExecutivesIt’s no secret that the solar industry is going through an awkward stage right now. Falling incentives, increased production, lowered prices, trade wars and other factors are putting warts and pimples on a technology that’s a drastically cleaner, less oily alternative to fossil fuel-based electric generation.

During the recent Solar Power Colorado conference put on by the Colorado Solar Energy Industries Association, solar executives discussed where solar is at and how it will win in the long-run.

“We are really entering what I would call the decade of solar,” said Gregory Wilson, National Renewable Energy Laboratory director at the National Center for Photovoltaics.

“Everything is lined up for solar to really become a major source of greenhouse-gas-free electricity,” said Wilson.

The goal of solar manufacturers and the larger industry is to create cheap, reliable energy, but that hasn’t been viable thus far, according to Abound Solar CEO Craig Witsoe.

“We're now seeing an environment, which let's all admit, is a little bit insane,” he said.

Witsoe anticipated that as solar moves through this tricky period, it will become one of the future’s lasting energy technologies.

“There's nothing bad about the routes that we can take here,” he said. “We can take all these things and rely on something you can produce rather than something you take out of the ground. I believe that economics wins out and believe solar will be big.”

One thing that’s helping solar is in the U.S. is that over the last two years people have become more aware of its benefits, said Jane Palmieri, vice president of Dow Solar.

“That doesn't mean there isn't a tremendous amount of work to do in terms of education and awareness. Just because awareness has gone up doesn't mean it’s not filled with misinformation,” she said.

For instance, the failure of Solyndra last year and its loan guarantee received a lot of negative media attention and stymied people’s opinions of solar.

“That's not helpful,” Palmeri said. “I think we really have to rally the industry so the success stories really get told, because right now that's not the message that's making it to main street America.”

The trade wars between the U.S. and China solar industries are also not helpful for the industry.

Subsidies are also a big issue.

“It’s interesting how that's one of the things that becomes so salacious in markets,” Palmeri said.

But most don't realize that all forms of energy in the U.S. were heavily subsidized at some point.

“That's something I think we have work to make sure we get positive messages around,” Palmeri said.

With increased competition from China and other PV manufacturers, the cost of PV-based electricity has dropped more rapidly than expected, according to Wilson.

“Probably 2 cents a kilowatt hour have peeled off the levelized cost of electricity, which is good overall for solar but not good for those making panels. Margins are negative and have been suppressed across the supply chain,” he said. “I believe this is a very volatile space, but in the end solar is going to grow rapidly over the next 10 years.”

The major driver of the industry in the past was Germany, according to Witsoe.

Now the U.S. has a chance to become one of the biggest markets in the world, as does China. Part of the market destabilization was because China put most of its early efforts in supplying modules and not creating domestic demand. Now the country also is creating local demand.