Apple’s massive solar farm in North Carolina, photo by WCNC-TV

Here’s the 7 projects:

• A solar financing model: NREL and solar financing startup Clean Power Finance will use $2.26 million to analyze data from 1,300 solar installation companies to try to create new types of community and regional financing methods.
• A publication and patent reader: SRI International, the University of Toledo and GE will use $600K to create software that can read and analyze science publications and patents to unearth innovations that can lower the cost of solar.
• Articulate a solar theory: Gordan Moore had his own law for chips, and some in the solar sector talk about a Swanson’s Law for the dropping cost of solar, but folks at MIT will use close to $500K to study the tech evolution process of solar and to create an overarching theory.
• Better forecasting of production costs: Researchers at the University of North Carolina at Charlotte, Arizona State University and the University of Oxford will use almost $950K to analyze data about patents, prices and production to create better forecasts of solar cell, wafer and panel prices.
• A model for solar markets: Sandia National Labs, the University of Pennsylvania and the California Center for Sustainable Energy will use $2.3 million to process data about solar markets and to create a model looking at how economic and social issues impact solar installations.
• Better strategies for community-led solar purchasing: Yale and SmartPower’s New England Solar Challenge will use $1.9 million to develop new strategies to that can make community solar buying programs work better.
• More effective solar installation in Texas: The University of Austin will use close to $500K to collaborate with six Texas utilities to create more strategic ways to install and interconnect solar in the state.

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The cash grant program was funded from the stimulus package as a way to help spur clean power project development, particularly in the wake of the 2008/2009 recession and for small clean power developers. Clean power projects have long been able to take advantage of the production tax credits (PTC) and investment tax credits (ITC), which give clean power companies 30 percent of total eligible costs of a project in the form of tax credits that can be used to offset taxes paid on company profits.

However, because many clean power companies are small and have tax liabilities that are less than the value of their available tax credits, some of the companies couldn’t take immediate advantage of the ITC and the PTC. Commonly those smaller companies would turn to tax equity investors to make up for the shortfall, but the recession made the tax equity market a lot weaker. To help combat all of these issues, the DOE created the 1603 cash grant program, which gave clean power companies an option to take a one-time cash grant that was equal to what they would have gotten from the ITC/PTC, so 30 percent of the cost of the project.

The report says that the $9 billion cash grant program supported the installation of 23,000 clean power projects — both large scale wind and solar panel projects — which is the equivalent of adding 13.5 GW of clean power to the grid (or enough to power 3.4 million U.S. homes). Those projects also attracted more than $20 billion in direct investment from private, regional, and state sources, says the report. The report also finds that these projects will deliver $1.8 billion per year in economic output for the next 20 to 30 years, or the lifetimes of the systems.

As Politico points out, the bulk of the jobs created through the grant program were indirectly, like for parts manufacturing, and a smaller portion of jobs were created for the design and development of the actual renewable energy systems. In addition, it’s hard to tell if the clean power projects would have been installed anyways, with or without the cash grants.

In a campaign year, we’ll see how popular extending a clean power program will be. President Obama is calling for extension of the program, while the report was delivered just a week after Speaker John Boehner called on the DOE to provide proof that its programs create jobs.

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At the Photon Thin Film conference in San Francisco last week, well-known researcher Rommel Noufi, who heads the thin film research at the National Renewable Energy Laboratory, challenged startup AQT Solar over promising and under delivering.

AQT Solar’s CEO, Michael Bartholomeusz, gave a pretty standard talk about the company’s shift from using the material combo CIGS (stands for copper-indium-gallium-selenide) to using CZTS (copper-zinc-tin-sulfide) for its solar cells. The Silicon Valley startup hasn’t met the goals it set a few years back with the manufacturing of CIGS solar cells, but it recently raised $18.7 million and is now charging ahead with its new CZTS technology instead. He promised to commercialize the CZTS technology in 2013.

And after Bartholomeusz spoke, Noufi stepped up to the microphone that was set up for a Q&A, and promptly put Bartholomeusz on the spot and cautioned about making empty promises: “The only advantage of CZTS is when indium and gallium disappear. We have to be careful about not giving another technology a bad name.”

In his own defense, Bartholomeusz, pointed out that the amount of money that has been pumped into developing CIGS technology has yet to make a significant dent in the market. He said: “I don’t think any commodity since the dawn of time hasn’t responded to supply and demand. So with indium and gallium there will have an issue.”

Failure of CIGS

The exchange ended there, but the feeling that the CIGS technology, which has attracted more than $1 billion in venture capital, hasn’t become a key player in the solar market lingered. Markus Beck, who until last December was heading the secretive CIGS development lab at First Solar, gave a talk at the conference that outlined why the CIGS community hasn’t achieved success. 

Some of the missteps involved experimenting with too many different ways to making CIGS panels and falling short on figuring out how to run production lines efficiently, Beck said. He noted the reliance on venture capital is partly to blame – VCs want to bet on cutting-edge technology because it could deliver a huge return if done right. But that in fact encouraged the development of fancy but expensive products that can’t compete, and Solyndra is a prime example, said Beck, who was the lead scientist at Solyndra before joining First Solar in 2008.

“If I say I have a new sexy process, then people give you money. We have diluted the money that is available to us,” he said.

Aside from AQT, other CIGS companies that still hope to become major players in the market include MiaSole, Nanosolar, HelioVolt, Stion, SoloPower, Soltecture, Global Solar, Solibro and Avancis. Several of them have brought in new CEOs in recent past. The biggest CIGS solar manufacturer is Solar Frontier, which brought online a 900 MW factory in its native Japan last year. The company last month announced a deal to supply up to 150MW of solar panels for a project in California. That project is now touted as a sign that demand for CIGS technology is there. Now if only other CIGS solar manufactures could work fast enough to meet demand.

Photo courtesy of Micky Aldridge via Flickr and Nanosolar

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EnFocus, based in Hayward, Calif., has created a solar panel containing dozens of optical modules with lenses that concentrate and direct sunlight onto slivers of solar cells underneath to produce electricity. The optical system further directs and diffuses sunlight so that it floods into the room uniformly and creates ambient light, Lu said.

The ability to distribute the light evenly is a tricky task that many ordinary skylights can’t accomplish, Lu said. That’s why you sometimes get a brighter beam of light when you are underneath a conventional skylight. Such uneven disbursement isn’t typically a problem for a skylight at home, but it could be a concern at work, where employers don’t want certain parts of a room to shine brighter and feel warmer and cause discomfort for employees.

Google’s “primary intention is to have quality lighting for their engineers,” Lu said. “Saving electricity cost is only part of the payback. It’s more important for the employees to be more productive.” Google spokesman Parag Chokshi said the company likes to investigate and support new technologies, and that makes EnFocus a good candidate for doing a pilot project there.

The solar skylight

Each 100-pound EnFocus solar panel measures 53 inches by 44 inches by 8 inches and can produce up to 288 watts of power. The panels are encased in glass boxes to protect the components from environmental damage.

The panel sports a dual-axis tracker so that the optical modules will follow the sun’s movement throughout the day. The lenses concentrate the light 400 times onto cells made with gallium-arsenide and germanium, and that amount of concentration requires the use of direct sunlight.

Instead of tilting the entire panel to follow the sun, the tracker will tilt individual optical modules. An ideal installation would position the panel at an angle above the roofline to face south in order to get the maximum sun exposure, similar to the orientation of conventional solar panels on the rooftops.

Because the optical modules collect some of the light, they in effect reduce the amount of light and therefore the amount of heat entering the space below. That helps to cool the room and reduce the need to blast the air-conditioning system. Lu noted that some of the big skylights at airports often end up heating the space because they don’t do a good job of reflecting some of the light.

Embedded solar trend

The idea to design a system that generates solar electricity while also keeping out some of the heat is a popular one among companies. Several other startups, such as SolarOr and Pythagoras Solar, are putting solar technologies inside double-pane glass for windows or building facades. Architects and building owners who fancy using these high-tech windows and skylights will have to figure out how much energy and money savings they can really achieve with designs when electricity generation may not be the chief benefit.

Many of these startups are in the research and development stages and are setting up pilot projects to see if their systems perform as expected. Lu is looking to raise $3 million in venture capital for further development and to launch the technology into the market.

EnFocus was founded in 2004 to develop solid-state lighting, and it later switched focus to solar and won a $2.9 million research grant from the federal Solar America Initiative. The company also raised an undisclosed angel round of funding. A key investor is Inland Metal Industries, which also will fabricate and assemble EnFocus’ prototype systems.

The pilot project at Google will be crucial for EnFocus to prove its technology. Its panel design contains more moving parts than conventional solar panels, so making sure the mechanical components work well for many years is one of the challenges, noted Daniel Friedman, the manager of the concentrating photovoltaic group at the National Renewable Energy Laboratory.

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Verizon has signed a memorandum of understanding with the National Renewable Energy Laboratory which, as part of the U.S. Department of Energy, more often works with clean power developers in solar and wind. NREL has done some work on software for modeling and analyzing a building’s energy use since energy efficiency improvement is a major goal of the DOE.

The phone company said it wants to work with NREL on two key areas: running its operations, including data centers, in more energy-efficient ways, and developing technologies that make use of Verizon’s communications network to cut energy use at homes and businesses.

We will be interested to know what this collaboration will come up with and whether it will help to promote segments of the smart grid market that haven’t seen as much traction as some companies and their investors have hoped. One area that has struggled has been home energy management tools. Google and Microsoft made headlines last month when both ditched their once-heralded energy-management software and portals that were designed for consumer use. They are hardly alone. Some startups in this sector also have found lackluster interest from their intended customers, be they utilities or consumers.

Now telcos such as Verizon and AT&T probably think they can create better tools than utilities, and can use their weight to get tools into the market faster than some of the startups focused on this. At the very least, they can work with all these players to test what business models make sense in the new smart grid market. Telecom companies already have the communications networks and some insight into people’s use of gadgets and data.

Verizon began running a home energy management pilot project in New Jersey earlier this year. The company also joined a $17.7 million round for Consert, a startup with a home energy product that connects via Verizon’s cellular network.

Finding ways to cut its own carbon emissions also is a smart thing to do for Verizon and other wireless and cable service providers, even though there is no government policy in the U.S. mandating such reporting. The information and communication technology (ITC) industry accounted for 2 percent of the global carbon emissions in 2007. The SMART 2020 report by The Climate Group said the ITC industry contributed 0.53 billion tons of emissions in 2002 and will likely put out 1.43 gigatons in 2020 if no special actions are taken (business as usual scenario). Through measures such as the use of smart grid technologies, the industry can reduce the overall, worldwide emissions in 2020 by 7.8 gigatons.

Photo courtesy of awoodvine via Flickr

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The test cell exceeds the previous record of 16.7 percent for a solar cell made of cadmium-telluride set by the National Renewable Energy Laboratory in 2001. The new record is critical not for bragging but for showing solar panels made with cadmium-telluride cells can have a longer presence in the market than previously expected.

Efficiency is correlated with how much power a panel of a given size can produce – more power means higher efficiencies. There is a fixed cost and amount of time for making each panel, and First Solar’s technology makes a panel in less than 2.5 hours. If the company produces each panel with a higher power rating (in watts), then that panel’s cost-per-watt is lower.

The Arizona company has been hailed as the lowest-cost solar panel manufacturer in the industry for some years now. Producing panels more cheaply than others is the key advantage for First Solar, especially when its solar panels aren’t as efficient as most others in the market. During the first quarter of this year, the company produced panels with 11.7 percent efficiency at $0.75 per watt.

Competition is intense

The majority of the solar panels sold today are made with silicon, and they generally have efficiencies a few percentage points above First Solar’s, which is not made with silicon. Although the silicon panels cost more to make, they also can command higher prices.

The most efficient silicon solar panel on the market today is the recently launched 20 percent panel made by SunPower. The SunPower panel contains cells that can do 22.4 percent efficiency. When cells are assembled into a panel, they don’t all perform the same, hence the lower panel efficiency figure. Plus, the panel efficiency includes the frame area where there are no cells.

SunPower and fellow silicon solar panel makers are eager to improve their products’ efficiencies as well, particularly given that silicon solar panel prices have fallen more than half in the past two years. In the last six weeks alone, the prices have fallen by 15 percent, according to IMS Research. The average price was close to $1.80 per watt in the first quarter of this year, and it’s reached below $1.40 per watt, IMS said.

Two big developments have caused the price to fall quickly: the declines of government subsidies in the world’s two largest markets, Germany and Italy, and the resulting piling up of solar panels because of the cut in demand. The cuts in subsidies, which are government-set solar power electricity prices that utilities must pay, have forced solar panel manufacturers and their component suppliers to lower how much they charge for their goods, or else their customers wouldn’t see any good profit in investing and building solar energy projects.

Solar panel makers have always known that they need to improve their products’ efficiencies. The quick price decline makes it more urgent for them to do it faster, if possible. Several large solar cell and panel makers have turned to technologies such as the silicon ink by Innovalight. The silicon ink has enabled Innovalight customers to boost their cells’ efficiencies by around 0.8 percentage point or more. That ability attracted the attention of DuPont, which just bought Innovalight for an undisclosed price.

Demonstrating that it can push the limits of efficiencies in cells made by its production equipment is important for First Solar to compete for many more years to come. Solar cell records are meant to show an achievable target, but they don’t convey how long it might take for the manufacturer to reach that efficiency at scale. Those records also refer to the best their holders can produce at a given time, not necessary what they can manufacture consistently in high volumes.

First Solar said it expects to boost the efficiency of its market-ready solar panels from 11.7 percent now to 13.5-14.5 percent by the end of 2014.

Photos courtesy of First Solar

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By buying Innovalight, DuPont not only added a new material offering to its lineup, it also snagged customers that have licensed Innovalight’s technology. The silicon ink developer has signed up some of the biggest solar-cell makers in the world, including Yingli Green Energy, JA Solar and Motech. Innovalight works with its customers to figure out how to incorporate silicon ink into their production lines, and it sells the ink as well.

A few years ago Innovalight decided to change its business model and has now demonstrated that to be a wise decision. Innovalight once wanted to become solar-cell maker.

Founded in 2002, the company decided to forgo that ambition when the financial market crashed and demand for solar goods dived in late 2008 and first half of 2009.  Startup companies were having a hard time lining up money to continue their product development and move into production. Innovalight’s CEO, Conrad Burke, told me at the time that Innovalight needed to steer away from the manufacturing business because it required too much capital.

Since then, the company has to seemed to have found success with the licensing model (and also selling the silicon ink). The U.S. Department of Energy has funded Innovalight’s research and development, including $3 million in 2009 and another $3.4 million earlier this year.

Innovalight targets silicon solar-cell makers who want to boost their solar cells’ efficiencies quickly without only relying on internal technology development that typically requires millions of dollars and years of development time. The rapid decline of the price of solar cells, which are assembled into panels, has prompted solar-cell makers to figure out ways to better compete not just in price but also performance in the last three years. Most of the solar panels sold today are made with silicon.

The prestigious R&D Magazine put Innovalight’s silicon ink technology, which was developed with the help of the National Renewable Energy Laboratory, on its annual top 100 list of innovations this year.

DuPont already is a big player in the solar market. It makes the films that protect solar cells from moisture and other environmental damage. The company said the solar market brought it over $1 billion in revenue last year.

Image courtesy of Innovalight

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US e-Chromic makes an electrochromic thin film that can be applied to the inside of existing windows, but can work in a similar way to the brand new dynamic windows that are being made by these players in their next-gen factories. US e-Chromic says when its film is applied to windows it can reduce cooling costs in buildings by 30 to 40 percent during warm air-conditioning heavy months.

The company, based in Boulder, Colorado, is commercializing tech that was developed at the National Renewable Energy Lab (NREL) in Golden Colorado. So far the startup, which is led by CEO Loren Burnett, has raised a small amount of funding from Amplifier Ventures.

Soladigm, on the other hand, has major manufacturing plans. The company is building a $130 million factory in Mississippi, and says it plans to start shipping its electrochromic windows in the first quarter of 2012; investors include Khosla Ventures, Sigma Partners, DBL Investors, and The Westly Group. Soladigm uses a thin-film deposition process to create conducting layers between two panes of glass that control the amount of light and heat that pass through the window.

Sage also has big production plans. The U.S. Department of Energy offered Sage a loan guarantee of $72 million, and Sage has a 300,000-square-foot factory, in Minnesota.

However, US e-Chromic is still in the R&D stage. The company was founded just in April 2011.

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The new equipment will be able to cut solar module production costs to 70 cents per watt, from the roughly $1 per watt that can be achieved today from the company’s existing line, said Chris O’Brien, head of North American marketing for Oerlikon. The stabilized efficiency of the new 143-watt panels will achieve 10 percent, up from around 9 percent with the older line. The company expects its customers will be rolling out new panels with a lower production cost and higher efficiency in 2012.

Stabilized efficiency is an industry standard for labeling an amorphous silicon panel’s efficiency (and power rating), and it refers to the efficiency and power a panel could yield after it’s been exposed to the sun for 1,000 hours. Amorphous silicon material, by its nature, loses some of its ability to convert sunlight into electricity quickly during an initial period.

“We are bullish on the thin film technology,” O’Brien said. “We think this set of announcements will go a long way to positioning Oerlikon Solar’s customers as among the low-cost leaders in the industry in 2012 time frame.”

In comparison, First Solar’s cadmium telluride solar panels have lower power ratings but can already achieve a higher average efficiency of 11.2 percent and a manufacturing cost of 76 cents per watt.

Oerlikon is rolling out the new equipment at a time when amorphous-silicon technology still seems a dicey bet. Many startups have invested heavily by buying a full-line of equipment from suppliers such Oerlikon, but the equipment can only make solar panels with efficiencies lower than most of the competing products on the market.

It didn’t help that its once fierce competitor, Applied Materials, announced its exit from the thin-film business in July. The difficulties of raising money to buy factory equipment during recession, competition from crystalline silicon solar panel makers and a lower-than-expected growth in the utility market were to blame, said Applied’s CEO, Mike Splinter, at the time. Some of Applied’s customers have struggled mightily. The insolvency proceedings for Signet Solar’s German operations began last week. Another Applied customers, SunFilm, filed for insolvency in Germany earlier this year. Suntech Power recently abandoned its ambition to produce amorphous silicon thin films with Applied’s machines.

It’s now up to the remaining factory equipment developers such as Oerlikon and ULVAC in Japan – as well as their customers – to proselytize the benefits of amorphous silicon thin films. It helps that veteran solar players Sharp and Kaneka are both believers and have continued to invest in this technology. Kaneka announced the completion of a new factory in June.

Oerlikon made several technology improvements to the new line, which produces solar panels with a layer of amorphous silicon and another layer of microcrystalline silicon. The new tools make it possible to deposit the silicon layers that are 30 percent thinner, a process that requires less material, speeds up the production rate and leads to the efficiency boost, O’Brien said. The company also is promoting a new sheet that protects the backside of the solar cells, claiming that the backsheet, by DuPont, can reflect unused light back to the silicon layers.

The equipment also comes with a laser tool that can cut thinner lines, leaving more cell areas intact to generate electricity. The laser equipment is what patterns and connects the cells, and the lines also act as arteries to move electrons out of them.

The new laser tool also can cut the lines in a way that reduces the voltage of each solar panel from 132-volt to 48-volt. Oerlikon’s customers asked for this change because installers want to be able string more panels per inverter, O’Brien said. Oerlikon can start shipping new equipment next year, and customers will be able to start mass production in 2012.

The company also announced that it worked with Corning to develop an 11.9 percent cell in the lab, a stabilized efficiency that has been verified by the National Renewable Energy Laboratory. Getting the technology out of the lab into commercial production will take time.

Many of Oerlikon’s customers are China, Taiwan and Europe, including Astronergy, Tianwei SolarFilms and Gadir Solar. Oerlikon announced its first U.S. customer, Clairvoyant Energy, last November, and said at the time that Clairvoyant planned to start production in late 2011.

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