This year’s Solar Power International (SPI) conference, which was held last month in Los Angeles, demonstrated a decidedly global flavor. According to the Solar Energy Industries Association and the Solar Electric Power Association, which co-hosted the show, a full 32% of exhibitors featured an international company, and industry professionals from 111 countries attended.
Even so, the industry remains intensely focused on the status and fate of the U.S. solar market, which has reached a turning point that will have significant global ramifications. Germany, the world’s current solar champion, is predicted to enter a slower phase of growth due to cuts to its feed-in tariff (FIT), said Julie Blunden, executive vice president for public policy and corporate communications at SunPower Corp., at an SPI panel session.
To avoid lost momentum, other countries must ramp up their own solar installation markets. "The U.S. is certainly in a good position to help pick up some of the slack," Blunden said. "We have good, strong, steady growth here – in fact, it has been very strong this year." By the end of 2011, the U.S. could be larger than any other market except Germany, she added.
Blunden and the other solar executives who spoke at the session, titled "Leading or Lagging? A Comparison of the U.S. to the Rest of the World," acknowledged that the U.S. market is, in fact, lagging on the solar installation, technology research and product manufacturing fronts.
However, they stressed, the country can stop lagging and start leading – if it can capitalize on certain inherent strengths within the solar sector and further enhance its potential with the right policy framework.
Thin-film PV is one of the U.S.’ important solar strengths, said Danielle Merfeld, director of the solar technology platform at GE’s Global Research Center. Developers of thin-film PV technologies have historically received sizable support from the private-equity and venture-capital markets in the U.S. – resulting in numerous advancements and room for more future breakthroughs than what may be possible with crystalline silicon PV modules.
"Thin-film technologies certainly have what looks like more runway in terms of an opportunity to achieve more efficiency," Merfeld remarked.
In addition, new advanced coatings under development – as well as certain other adaptations to thin-film module design – could ultimately benefit all types of PV modules if they can be transitioned from "academic pursuits" to cost-effective real-life applications.
Being competitive in thin-film technology and other solar technologies will require government support, Merfeld noted, adding that the U.S. Department of Energy (DOE) has taken steps in the right direction.
"The DOE has already announced a shift back to some primarily basic-component development along the lines of scientific advancement – whether it’s thin films or power electronics – and less on market development," she said.
Government backing for scientific research into PV must also be provided in the form of installation-friendly policy, as the largest driver of solar innovation in the U.S. will be strong domestic demand for PV, according to Merfeld. "Whatever policy drivers are going to help [increase demand] are definitely going to flow to innovation in the U.S.," she explained.
One such policy driver that is widely regarded as necessary to the U.S.’ solar success is a FIT, which has been tightly linked to Germany’s solar success but has not yet become an element of the U.S.’ national solar policy.
Marc van Gerven, Q-Cells’ managing director and chief marketing and sales officer for North America, noted that U.S.-based solar players must not attribute Germany’s boom to the mere existence of its FIT and the rates that were, until recently, given to solar producers.
"Grid-access priority, simplifying and standardizing the procedures, and not having hundreds of pages of contracts have really helped Germany," he said. "It’s not just the actual rates that are being paid."
For example, unlike in the U.S., German law states that interconnection costs must be paid by the project developer or system owner, and the required grid upgrades are the responsibility of the grid operator. Germany also provides a fixed and guaranteed 20-year contract term under its FIT program – a benefit not afforded to solar producers in the U.S.
Balance-of-system (BOS) components may not be seen as important as module technology or FIT policy in determining whether the U.S.’ solar market leads or lags. But according to Wendy Arienzo, CEO of Array Converter, BOS products represent a meaningful piece of the puzzle – and, thus far, a missed opportunity.
"We certainly don’t have a leadership position in most components," she said. "The U.S. has not had steady and reliable demand that businesses can count on." Consequently, the U.S. has not yet been able to take advantage of the economies of scale that have helped other countries. Germany, for example, has dominated the inverter market.
Above all, the panelists emphasized that from laboratory work on revolutionary thin-film module structures to production of inverter components and other BOS products, all aspects of U.S. solar leadership require favorable policy to drive installation growth.
"Our [installation] pace has been a little bit more measured than what we’ve seen in Europe," Blunden said. However, she continued, the moderate pace may ultimately prove to be more sustainable, allowing the U.S. to avoid hitting the early asymptotes that many European countries are encountering.
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