In September, there was a post to a solar industry Linked-In group suggesting that solar markets were declining and not very important. Let’s look at some GLOBAL evidence to the contrary in terms of dollars moving in solar markets.
Two of the world's largest engineering giants, German conglomerate Siemens and US powerhouse General Electric (GE), have both committed to the renewable energy sector. Both have acquired high-profile Israeli solar energy firms.
Siemens announced will acquire solar thermal power firm Solel Solar for what is nearing a half BILLION dollars ($418 million). The buyout is subject to regulatory approval, but Siemens said it is confident the acquisition can be completed before 2010.
Israel-based Solel is one of the world's leading providers of giant mirrors, which are used in parabolic trough solar thermal systems. The company posted sales of almost $90 million in the first six months of this year and has operations in a number of key solar markets, including Spain and the US.
Siemens' President suggests that they want to replicate their success in the wind energy market. They are estimating a Solar Thermal market worth €20 billion PER YEAR by 2020. Siemans is also a member of the Desertec coalition of German blue chip firms exploring large scale solar farms in North Africa that hopes to export energy to Europe.
GE announced it has spent an undisclosed sum as part of a $23 million funding round for Israeli solar start- up SolarEdge. The company provides an automated management system for photovoltaic solar panel arrays designed to ensure each panel is able to maximize power output.
GE also took a piece of US smart grid firm Tendril and announced that is was aiming to boost its investment in renewable energy generation from the current level of $4 billion to $6 billion by the end of 2010. Just a few “smart billion” among friends.
Let’s look at California, since they are one of the largest economies in the world and the government is complaining it’s broke. You’d think this would mean that they would stop investing in solar if anyone would.
Sempra Energy and PG&E both announced large new solar commitments in October (2009) with Sempra planning to build up to 500MW of its own new solar-power plants in the next few years and PG&E signing contracts to buy a whopping 830MW of new solar.
PG&E wants to add 500MW of ground-mounted solar-power systems and Sempra subsidiary San Diego Gas & Electric has applied for approval for 70-80MW of ground-mounted solar panels. Another California utility, Southern California Edison, has gotten approval to add 500MW of rooftop solar projects, and both SCE and PG&E have signed deals for huge solar-thermal projects, including 1.3GW and 1.31GW contracts from BrightSource, respectively.
Residential and commercial installations appear tiny in terms of capacity, although there are many more of them. In the first quarter of this year, for example, the California Solar Initiative announced that its participants installed a record total of 78MW at more than 3,600 sites.
The leap in utility solar development has been even more pronounced because it comes at a time when it’s been so difficult for other large solar-project developers to raise money. Recession financing has remained scarce, and while federal cash grants are beginning to help, most of those have gone to wind projects so far. But we see a helio-tropic shift coming.
It’s not a coincidence that utilities have begun driving the solar market at the same time that they have become eligible for the first time for federal tax credits and cash grants. Those incentives have made it feasible for them to build their own plants, instead of financing them through power-purchase-agreement providers that own and operate the plants.
Some entrepreneurs worry that big utilities could monopolize the industry instead of encouraging competition within the market. I expect many of these utilities will also help the economy by hiring clean tech research firms like Research 13 to evaluate the markets and show the positive impact of solar pushing prices downward for all as the demand for systems increase in the long run. So far, the CPUC has addressed this concern by making sure that – in addition to developing projects themselves – utilities also buy solar power from developers, making them customers as well as competitors.
The Govenator has been busy this month keeping his wife off of the cell phone, and he’s been out of the sunlight as First Lady Maria promotes her new book about women in the workplace. While this month appears to be Maria’s month, last month the Gov. raised the state goal, requiring utilities to get one third (33%) of their electricity from renewable sources by 2020. That’s ambitious, even for Hans and Frans, considering that utilities are expected to fall short of the previous goal of 20 percent by 2010. You don’t get to be one of the world’s biggest box office stars and marry into the Kennedy family without an ambitious plan.
Let’s not forget China who is producing half of the solar PV panels. China is reportedly spending $230 billion in stimulus money on “green infrastructure.” That’s 40% of China’s stimulus package is going to the green economy. There’s a big push to get a domestic solar market. They started off in March with the Solar Roofs Program and then in late July they announced the Golden Sun project, which is more utility-level.
So with just the California “warm California sun” plans and the Chinese “Golden sun” program, things are, eh, sunny and bright.
Of course a little more exploring of the gentleman who said solar was going to decline reveals that he was part of the petro-chemical industry. They’ve owned energy for a long time, so I’m not surprised it’s hard to believe for him. However, I think he might also thin the sun rises in the morning (the earth actually spins once every 24 hours and takes 365 days to get around the sun).
Sources: Business Green, Aimeebarnes.com, Environmental Leader, Earth2Tech, Earth Stream