Sunday, October 31, 2010

India to America, LEAD US, we believe.

Saurabh Srivastava, co-founder of the National Association of Software and Service Companies in India, explained that for the first 40 years of Indian independence, entrepreneurs here were looked down upon. India had lost confidence in its ability to compete, so it opted for protectionism. But when the ’90s rolled around, and India’s government was almost bankrupt, India’s technology industry was able to get the government to open up the economy, in part by citing the example of America and Silicon Valley. India has flourished ever since.

“America,” said Srivastava, “was the one who said to us: ‘You have to go for meritocracy. You don’t have to produce everything yourselves. Go for free trade and open markets.’ This has been the American national anthem, and we pushed our government to tune in to it. And just when they’re beginning to learn how to hum it, you’re changing the anthem. ... Our industry was the one pushing our government to open our markets for American imports, 100 percent foreign ownership of companies and tough copyright laws when it wasn’t fashionable.”

If America turns away from these values, he added, the socialist/protectionists among India’s bureaucrats will use it to slow down any further opening of the Indian markets to U.S. exporters.

It looks, said Srivastava, as if “what is happening in America is a loss of self-confidence. We don’t want America to lose self-confidence. Who else is there to take over America’s moral leadership? American’s leadership was never because you had more arms. It was because of ideas, imagination, and meritocracy.” If America turns away from its core values, he added, “there is nobody else to take that leadership. Do we want China as the world’s moral leader? No. We desperately want America to succeed.”

This isn’t just so American values triumph. With a rising China on one side and a crumbling Pakistan on the other, India’s newfound friendship with America has taken on strategic importance. “It is very worrying to live in a world that no longer has the balance of power we’ve had for 60 years,” said Shekhar Gupta, editor of The Indian Express newspaper. “That is why everyone is concerned about America.”

India and America are both democracies, a top Indian official explained to me, but emotionally they are now ships passing in the night. Because today the poorest Indian maid believes that if she can just save a few dollars to get her kid English lessons, that kid will have a better life than she does. So she is an optimist. “But the guy in Kansas,” he added, “who today is enjoying a better life than that maid, is worried that he can’t pass it on to his kids. So he’s a pessimist.”

Yes, when America lapses into a bad mood, everyone notices. After asking for an explanation of the Tea Party’s politics, Gupta remarked: “We have moved away from a politics of grievance to a politics of aspiration. Where is the American dream? Where is the optimism?”
Tom Friedman NYT

Thursday, October 21, 2010

Cost of solar keeps moving...down down down

A company that secured a Department of Energy grant to pursue a breakthrough idea in the manufacture of solar cells plans to announce on Tuesday that it has raised $20 million to commercialize its technique, which it says will reduce the price of solar panels by 40 percent.

The company, 1366 Technologies of Lexington, Mass., has found a simpler way to produce the basic building block of solar cells: silicon wafers. It uses molten silicon to cast the wafers in their final form, six inches on one side and 200 microns thick, or about eight-thousandths of an inch.

The current method is to cast the silicon in huge ingots or grow it in giant crystals and then saw off thin pieces, which wastes about half of the silicon.
“Early indications show this could be one of our great success stories,” said David Danielson, the program director for solar energy at the Advanced Research Projects Agency — Energy, a new office within the Energy Department that provides relatively small grants to develop high-risk but potentially high-payoff technologies. It promised 1366 a grant of $4 million for an 18-month program to develop the wafer technology; 1366 is reporting success after eight months.

The company is expected to announce that it has raised $20 million in new capital, some of it from a major customer for the wafers, Hanwha Chemical of South Korea. Other investors include Ventizz Capital Fund, a European company that specializes in clean energy investments. Two companies that had previously invested, North Bridge Venture Partners and Polaris Venture Partners, have also added funds.

The chairman of Hanwha, Ki-joon Hong, said in a statement that his company had “every confidence that 1366’s innovations will fundamentally change solar manufacturing.”
The silicon, the basic material of solar cells and computer chips, is derived from a very cheap material, sand. But to function in electronics it must be made extremely pure, which makes it expensive.
The new technique, going from molten silicon to final product, is a bit like frying pancakes as opposed to slicing salami, except, as Mr. Danielson put it, “when you cut a salami, it’s not like half the salami ends up as salami dust that you have to throw in the garbage.”
The trick is to get the wafer out of the mold without breaking it. Company officials will not say just how they do that. The president of 1366 Technologies, Frank van Mierlo, predicted that the development would make solar power cheaper than coal power, although the technique has not yet been commercialized.

If the wafers go to market, 1366 would be one of the early fruits of the ARPA-e program, which was authorized by Congress in 1997 and signed into law by President Bush but was not financed until the passage of the federal stimulus act, which gave the program $400 million over two years. In December, 1366 received $4 million.
The company’s name is a reference to the amount of solar energy, measured in watts, that falls on a square meter of the earth’s surface.

The cell has other refinements, including finer wires to conduct away the electrons, so the shadow cast on the energy-gathering area is smaller. And the company drills small holes into the cast wafer to give it a honeycomb appearance, which allows light to bounce around inside the crevices, producing better absorption and less reduction, Mr. van Mierlo said.

October 19, 2010, 8:29 am NYT
A Cheaper Route to Solar Cells

Monday, October 4, 2010

Why Solar Will Make or Break its Own Future

posted by
StephenLacey REW

Why Solar Will Make or Break its Own Future

Every industry has a rock star. The financial industry has Warren Buffet. The tech industry has Steve Jobs. The oil industry (and now wind industry) has T. Boone Pickens. And the solar PV industry has Jigar Shah.
So what makes someone a rock star in the business world? Well, success is a prerequisite. As the founder of SunEdison, a firm that pioneered the commercial solar power purchase agreement in North America, Shah's rise in his mid-thirties was one of the first high-profile success stories in the modern solar industry.
But achieving rock-stardom is about much more than being a good businessman. Even Shah (who has never proclaimed himself a star of the solar industry) admits that financial success is only a very small part of industry success – especially in renewables and efficiency.
“You can really make a ton of money in these areas and never make a difference. And that's really sad,” he says.
He points to the energy efficiency sector where numerous $50 million-a-year businesses have barely made a dent in Americans' wasteful energy consumption. The same could be said of the solar industry, where a company like thin-film manufacturer First Solar – with revenues of over $2 billion and a market capitalization of $12 billion – is leading a market that represents a tiny fraction of the overall energy mix.
But Shah believes that solar is on a path toward high penetration. He criticizes those who say solar is too expensive, or that we need breakthrough technologies to make any difference. He believes that the positive indicators are staring us in the face, and anyone who doesn't see them is blind or purposefully ignoring them.
And this brings us to another defining trait of a rockstar: Someone who is able to envision and articulate the future of an industry, even if that vision is not always consistent with conventional wisdom (i.e. solar is too expensive, solar is too intermittent, the technology is not ready).
I had the opportunity to co-host a web conference this week with AltaTerra research about the outlook for the solar industry through 2013. Shah was the featured speaker, and he offered a lot of insight into how this very volatile market will play out over the next few years.
The theme of his talk was “The Solar Industry Controls its Own Destiny.” By this, he means that the pieces are already in place for companies to put massive amounts of solar online. It's about building strong businesses now, not blaming politicians or the fossil energy industries for setbacks.

Here's a quick summary of the key points he made:

• The magic number for solar is $2 a watt installed. At that price, 30% of the global electricity supply could be cost-competitively met by solar PV.

• By 2012, the price of a 1 MW crystalline-silicon solar PV system will dip as low as $2.60 a watt installed, putting solar well within the $2 per watt threshold.

• Due to these prices (ranging between $4.60 a watt and $2.40 a watt), existing solar technologies will make a substantive impact today – no third-generation solar technologies needed. Shah believes the incessant focus on “breakthrough” technologies, while important in the long-term, distracts us from the realities of what we can do today.

• We can expect to see about a 35% compound annual growth rate through 2013, with a 65% growth rate in North America, 18% growth in Europe and 68% growth in emerging markets like India, Singapore and China. The industry will put about 20 GW of global capacity online in 2012.

• As solar reaches the $3 per watt installed range and starts to move below that level, utilities are developing solar for reasons other than regulatory pressure. For example, according to a Florida Power and Light executive, solar PV is now cheaper than new coal facilities in that utility's service territory. In addition, the Georgia PUC reported that a new nuclear facility would raise utility bills in the state by $1.30 a month. But a combination of solar, thermal storage and dynamic load control would have raised rates by only $1 a month.

• Due to fewer regulatory and capital constraints, distributed generation will rule the day. With over 3 billion square feet of flat roofs installed globally each year, around 20 GW of solar could theoretically be accommodated. While centralized generation like CSP will be important, Shah says that the complications associated with permitting and building new transmission lines for mega-projects will slow down growth of that sector.

• The best companies will be all-stars in international finance. As markets shift year by year, understanding how to finance projects across a variety of markets will be critical to success. Companies that are financially nimble and sophisticated will lead in solar.

• Most innovation will take place downstream, not upstream. Shah believes that the low hanging fruit to reduce costs is in the balance-of-systems sector (inverters, power optimization, tracking software, racking, wiring, labor) and in sales and distribution. (If we can create incredibly sophisticated channels for toasters and flat screen televisions, why can't we do the same for solar?) He also believes that lead generation, sales and installation will be separated.

• Given all these trends, Shah says that solar will reach a 5% penetration in the U.S. by 2020.

• He admits that the policy environment for solar is still sketchy in some markets. But rather than "bitch" about not getting equal support, he says the industry should be telling the fossil energy industries, "we'll get rid of our tax incentives if you get rid of yours."

Shah's main point throughout the presentation was that the industry already has a good business environment to build from – it is no longer about what “they” are going to do to support solar. It's about what “we” are going to do to grow the industry. Even without the full support of heel dragging politicians and utilities, there's still plenty of business to be done.