Clean energy race includes stimulus funding for small businesses

Recently,U.S. Energy Secretary Steven Chu stated that $37 million in fundingfrom the Recovery Act will be available to qualified small businessesthrough the Department of Energy (DOE) Small Business InnovationResearch (SBIR) and Small Business Technology Transfer (STTR) programs.This funding report follows a sequence of numerous other greentechnology allocations from the Stimulus program,which are being announced on nearly a weekly basis. As part of theannouncement, Secretary Chu connected job creation and innovation withsmall business funding initiatives, as a critical link to reducing greenhouse gas emissions and winning the clean energy race, which would generate sustained economic growth.

TheDOE SBIR/STTR programs are geared towards U.S. companies with fewerthan 500 employees, many whom will be attending the upcoming International GreenbuildConference and Expo in Phoenix, Arizona. These grants are excellentopportunities for start-up companies of various sizes as well as newspin-off entities of larger companies with strong research capabilitiesin science or engineering, exploring the emerging cleantech sector. Inspecific, the clean energy and energy efficiency focus areas for which applications are being evaluated are listed as follows.

1. Advanced building air conditioning and refrigeration, thermal load shifting, and cool roofs
2. Water usage in electric power generation and industrial processes
3. Power plant cooling
4. Advanced gas turbines and materials
5. Sensors, controls, and wireless networks
6. Advanced water power technology development
7. Smart controllers for smart grid applications
8. Advanced solar technologies
9. Advanced industrial technologies development
10. Advanced manufacturing processes 

Mostimportant, the deadline for submission of applications is September 4,2009, at 8:00 p.m. EST. Moreover, $8.5 million is expected to beavailable for new Phase I awards, and approved applicants may receiveup to $150,000 to demonstrate commercial potential over a six-monthevaluation period. More information about the DOE SBIR and STTRcleantech programs are available at this reference site.

Accordingto a recent straw poll of EE Times Europe readers, conducted during themonth of August, funding initiatives of this nature are well-accepted,especially in regards to solar cell technology. The poll focused oncomparing various options for generating the most return on capital forresearch and development (R&D) funding, and 24 percent ofrespondents’ voted for solar technology. Second, was investing insensor and control networks to reduce energy consumption in majorplants and infrastructure, an option which garnered 21 percent of thevote.   

A number of other programs scored well. The results areas follows in descending order: developing energy harvestingtechnologies received 13 percent; improving the efficiency of batteries was 12 percent; improving the efficiency of power supplies got 11 percent; improving the efficiency of lighting garnered 10 percent; and taking steps to lower the power consumption of ICs was near the bottom at 9 percent.  

Eventhough solar technology runs high in U.S. public opinion as well andPresident Obama has proclaimed wanting the U.S. to be “the world’sleading exporter of renewable energy,” in his term in office thus far,China has accelerated efforts to become the dominant player in greenenergy, namely solar power,even with respect to the U.S. market. Chinese companies havebeen effective in lowering the price of solar panels by almost halfover the last year, which has helped contribute to the enormousoversupply in the global market. Shi Zhengrong, the chief executive andfounder of China’s biggest solar panel manufacturer, Suntech PowerHoldings, stated recently that the company is selling solar panels onthe American market for less than the cost of the materials, assembly,and shipping to build market share, along with other companies duringthe inventory glut.

The Chinese clean energy industry is heavilysupported by the government, as in several other Asian countries suchas South Korea. Interestingly enough, Chinese companies are alreadypreparing to build plants to assemble their products in the U.S. toavoid any future competition litigation and/or cap-and-trade tariff penalties. Therefore, these companies may enter the U.S. and follow the trend of retrofitting former microchip or automobile plants for solar cell production. However, at least this will stimulate green job creation and help the country meet increasing greenhouse gas restrictions.

Even with a significant portion of the overall U.S. stimulus funding being dedicated to the cleantech sector, other pending legislationis vital for establishing sufficient end-user demand for Recovery ActR&D projects. In any case, many believe the U.S. will end up beingmore of a consumer as opposed to a producer of solar products, unlessthe country can establish sufficient domestic supply chains, amidst itssecond highest corporate tax rate for all major industrialized nations,equivalent to about 39 percent.

Since March, Chinese governmentsat the national, provincial and even local level have been competingwith one another to offer solar companies ever more generous subsidies,including free land, and cash incentives for R&D. Also according tothe New York Times, Chinese state-owned banks are flooding the industrywith loans at considerably lower interest rates than available inEurope or the U.S. Suntech, based in Wuxi, China, is paced to passQ-Cells of Germany this year, to become the world’s second-largestsupplier of photovoltaic cells, after only First Solar, headquarteredin Tempe, Arizona, but having its main manufacturing plants in Mainz,Germany and Perrysburg, Ohio. 

It has been a volatile last couple years for the solar industry,which enjoyed record sales growth in 2007. Shipments of solar powerequipment grew by 81 percent in the second quarter of 2009 with respectto the first, according to data from the IMS Research (Wellingborough,UK), indicating the industry’s downturn may finally be passing. TheU.S. clean energy market overall, which contributed to this growth, isprimarily being driven by cash-rich utilities that are announcingmulti-megawatt investments on nearly a weekly basis. 

Evenwith over $61.3 billion of green energy stimulus funding, the U.S. willbe aggressively challenged by China in the clean energy race. The U.S.has ranked well behind China over the last five years in terms of solarcell production, and it will take at least five years from now to judgethe impact of the 2009 cleantech stimulus, catered to not only largecorporations but small businesses as well, which has ultimatelyinspired a more serious green revolution in the U.S. and abroad.

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Image: Emblematic solar power plant in clean energy race (coloradoenergynews).



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