“If you like importing oil from Saudi Arabia, you’re going to love importing solar panels from China”
If you haven’t read Thomas Friedman’s op-ed piece today, do. It outlines the sorry state of the American solar industry, focusing on the U.S. company Applied Materials. Of its 14 solar panel factories worldwide, “not a single one is in America… five are in Germany, four are in China, one is in Spain, one is in India, one is in Italy, one is in Taiwan and one is even in Abu Dhabi.”
So much for “buy American” when our homegrown innovators can’t afford to manufacture or sell in America.
The reason that all these other countries are building solar-panel industries today is because most of their governments have put in place the three prerequisites for growing a renewable energy industry: 1) any business or homeowner can generate solar energy; 2) if they decide to do so, the power utility has to connect them to the grid; and 3) the utility has to buy the power for a predictable period at a price that is a no-brainer good deal for the family or business putting the solar panels on their rooftop… That is what Germany put in place, and that explains why Germany now generates almost half the solar power in the world today and, as a byproduct, is making itself the world-center for solar research, engineering, manufacturing and installation.
If we want to launch a solar industry here, big-time, we need to offer the kind of long-term certainty that Germany does or impose the national requirement on our utilities to generate solar power as China does or have the government build giant solar farms, the way it built the Hoover Dam, and sell the electricity… China has decided that clean-tech is going to be the next great global industry and is now creating a massive domestic market for solar and wind, which will give it a great export platform.
In October, Applied will be opening the world’s largest solar research center — in Xian, China. Gotta go where the customers are. So, if you like importing oil from Saudi Arabia, you’re going to love importing solar panels from China.
This all comes on the heels of ASP Board Member Senator John Kerry’s remarks on this same topic — Germany and China’s dominance and innovation in renewable energy, and what the U.S. stands to lose if we keep lagging behind — at ASP’s conference last week, The Day Before: National Security Implications of Climate Change.
Excerpts below; read the entire speech here.
It was Americans who developed the technological foundations of wind, solar, and advanced battery power. And yet just one of the top five wind power manufacturers is American; just one of the 10 largest solar panel producers is American; only two of the top 10 advanced battery manufacturers are American.
The world’s largest producer of renewable energy is not the United States, but Germany. And the economic benefits, as well as the environmental gains, are obvious: More than 280,000 Germans are employed in the renewable energy sector—a nine-fold increase in the past decade. While other countries debated how much their emissions could increase, since 1990 Germany has actually cut its emissions by over 20%!
Just think – for all the talk that China won’t act to prevent climate change, China today is producing cars a third-more fuel efficient than ours and making massive new investments in wind power and mass transit. The fundamental challenge is this: Are we going to step up and put in place the policies that will galvanize entrepreneurs, drive development of new clean technologies, reenergize our economy and tackle global climate change – all at the same time? What’s at stake is not whether the 21st century will be a green economy – it has to become one, and it will. The question is whether America will lead, and reap the jobs that come with being ahead of the curve.”
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Germany decided to launch the green industries (much more than just solar power) train in the early 90’s – there’s little reason to expect that many U.S. companies could jump on it and compete successfully. The Chinese have at least low labour costs, while the Americans have no advantage whatsoever.
The mentioned points two and three were also more relevant for wind power than solar power in Germany.
Photovoltaic solar power is great for applications that would otherwise require an expensive power line to be laid. Think of electric power supply for a highway surveillance camera far away from all settlements, for example.
The real solar power for really large energy supply is not photovoltaic power, but solar-thermal power. The easy version simply heats water a bit in a household. The advanced, large-scale version heats water to drive turbines and generate electricity (power plant). The latter works satisfactorily only in areas with mostly clear skies. Google “desertec” for an example.
Back to photovoltaic: Germany invested a lot into R&D (state R&D subsidies) for decades. That was a most important factor in the development of that sector. We’ve got institutes at our universities busy with research on R&D.
By the way; the German photovoltaic firms are about to be stomped by Chinese ones because of higher production costs and unexpected Chinese R&D progress.
Don’t forget Japan. Sharp solar panels may be the next big export as the company is hoping to capitalize on both concerns about global warming and countries’ potential fears of becoming dependent on importing solar panels rather than oil.