Solar industry sounds battle cry

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This week’s gathering of the solar industry at a conference in Dallas will become a temporary central command for solar energy advocates who see an urgent need to fight back against negative portrayals of the solar sector that have resulted from Solyndra’s federal loan guarantee and bankruptcy.

“Don’t mess with the solar industry” was a rallying cry used by Rhone Resch, CEO of the Solar Energy Industries Association, during a Monday evening speech to kick off the annual Solar Power International trade show.

“There are those out there who dismiss solar outright. Rush Limbaugh says that the solar industry doesn’t even exist. We should invite him to walk the floor in the next couple of days,” Resch said.

Resch urged the audience to give more financial and other support to the association, including its political action committee, and announced changes that would add state-level lobbying to SEIA’s repertoire. He pointed to job creation and solar energy generation numbers.

A lot is at stake for the industry, which is experiencing a difficult year because it’s made way more products than the market can absorb. Changes to government incentives in the largest markets, such as Germany and Italy, earlier this year delayed installations and caused a pileup of several gigawatts of unused solar panels in warehouses. That led to a 30-40 percent drop in wholesale prices for these panels – some manufactures are likely selling at a loss. Many stalwarts in the industry, including First Solar (s FSLR), SunPower (s SPWRA), Suntech Power (s STP) and Q-Cells, all have seen a big drop in earnings this year.

But the U.S. solar market is set on a path to grow – analysts are predicting that solar panel installations will double in 2011. Resch touted the fact that the U.S. exports $1.9 billion more solar goods than it imports from the rest of the world, including China. Many states have rebates and other incentives to entice home and business owners to install solar, as well as rules requiring their utilities to buy an increasing amount of solar energy or renewable electricity in general.

But growth could slow in the U.S. if a popular federal grant program expires as scheduled on Dec. 31 this year. Solar project owners are entitled to claim 30 percent of the cost of their projects in cash from this program, which was part of the 2009 stimulus package and was meant to be a temporary measure to help the developers with financing when banks were struggling. Congress already extended the program by one year, but that was before Democrats lost control of the House to Republicans.

Solar executives are lobbying for at least one more year of extension, arguing that the economy hasn’t recovered as quickly as anticipated and banks will charge higher rates for their money without this federal incentive in place.

Solyndra's factory full of panels in April

Cloud of Solyndra

The Solyndra debacle, naturally, hasn’t helped with the effort to renew the grant program. The California manufacturer of novel solar panels used a $535 million federal loan guarantee to build a factory last year, only to file for bankruptcy last month largely because its products were too expensive, particularly when prices from its rivals were plummeting. Some Republicans in the House have used the company’s failure to question the Obama administration’s management of the loan program. Other critics are using Solyndra to show that government should scale back its investment in solar.

Addressing the impact of Solyndra’s controversy, Resch said, “It’s wrong to view the industry through the lens of just Solyndra.”

Since Solyndra announced it was going out of business, Resch and solar executives have held press conferences and issued reports and polls to shape the public’s perception of their industry. On Wednesday, six solar company executives will hold a press conference at the Dallas conference to discuss their views of the industry’s future. The subject line of their email invite read, “Solar fights back at Solar Power International.”

Photo courtesy of Abound Solar

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Brian F

The solar industry needs an army of lobbyists in D.C. and in state capitals to compete in this political environment.

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