Thoughts on the Solar Industry’s black eye called Solyndra.

Sep 18, 2011PV installations

The Solyndra debacle has recently become a black eye for The American Solar Industry.A black eye that has not gone away and one that I fear will not go away for some time because the issue is now being used as a political football with a presidential election one year away.There many solar “nay Sayers” who continually trash anything to do with the Solar Industry and are now trying to exploit Solyndra’s failure in their consistent efforts to derail renewable energy development in America. I recommend reading the following blog for more on the politics regarding Solyndra. (Link)

I’d also like to say a few things about the status of the American Solar Industry today based on my own experience with regards to Solyndra.
Solyndra had a good product by any standards.A pv panel that’s cylindrical shape allowed it to capture light from any angle and allowed air to flow through it, eliminating the need to add extra weight to keep it from blowing away. This is a big deal for the customer and installer.One of the biggest problems when designing a large PV system on a large flat roof is the amount of weight added to the roof.It’s not good to add weight to a flat roof, however it is a better option than penetrating and anchoring down the system which is sure to cause the roof to leak sooner or later.The Solyndra option allowed a large system to be placed on commercial roofs with minimal weight, zero penetrations and less labor than a conventional system. By all means a good product.

The fact that Solyndra went bankrupt is not a surprise to me at all but it has nothing to do with insider politics.

However, Solyndra had a number of problems with its business model the biggest of which was manufacturing their product in America and not China. American manufacturing cannot compete with China and never will if China continues to manipulate its currency.You may have heard economists say that the weak economy is causing the dollar to fall in value making imports more expensive but allowing exports to be more attractive overseas. Not true if you are competing with China.China pegs its currency at about a tenth of a dollar so our greenback may fall in value but we will never be able to compete with China in manufacturing.To make matters worse China with its trillions of US dollars has decided to massively subsidize its own solar manufacturing industry causing an all out collapse in the price of Chinese made PV modules this year. As a result PV manufacturers all over the world have had to reduce their prices or face bankruptcy.This is a good news bad news scenario.Good news is that we can buy solar panels for much less than a year ago.Bad news we buy them from China and our money continues to leave the US.

Solyndra was also a new company with a new product and it always takes a while for new products to gain recognition.I had only heard of Solyndra a few months before it went under.Secondly, it was competing directly against lower cost rivals in a highly competitive field where product demand has gone down because of a glut of supply.Thirdly, and this one they should have seen coming, they thought they could sell their product at a premium. They had the wrong idea, that if you have a unique product you can sell it for more.That may be true in other industries but not solar where the end product is electricity.A customer at the gas pump doesn’t care if he fills up with Exxon or BP and most solar customers don’t care much if they buy Sharp or Suntech, ultimately they want reliable power.I believe that Solyndra should not have attempted a start up unless they knew they could make a profit by selling their product for under $1 per watt.Not a smart move.Now if they had manufactured in China it may have been a different story.Sad but true.The problem is the currency manipulation and price advantage Chinese manufacturing has currently.Any government attempts to spur manufacturing in America will have a significant disadvantage until the China problem is addressed. For all our sake I hope we find a reasonable solution soon because this problem effects the entire American manufacturing industry not just solar.

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