What's Really Happening to America's Solar Industry?

22.05.12

There's been a lot of negative press about the American solar industry in the past few months because six companies went bankrupt in 2011, even after receiving government loans. At least 12 U.S. manufacturers have suffered layoffs, plant shutdowns or bankruptcies over the past two years. Solyndra and Evergreen Solar are the most well-known because of media coverage about their government loans, but Beacon Power Corp, Mountain Plaza, Stirling Energy Systems, and Spectrawatt Inc. also went out of business, resulting in the loss of thousands of jobs. What's behind the financial trouble that many of these American solar companies have experienced? 

"Dumping" of solar cells and modules produced in China is the real culprit for the financial woes of the American solar industry.  According to a report  released by George Washington University in December 2011, China’s production of solar photovoltaic cells and modules has grown from 1 gigawatt (GW) to 20 GW in three years, and its industry now accounts for more than 50% of the global market. During the same period, prices for solar modules decreased to $1.40 per watt and may go down as low as $1 per watt. It is clear that over capacity in both purified silicon feedstock and module manufacturing have played a key role in the recent major price declines.  The annual market for solar more than doubled between 2009 and 2010. For 2011, estimates of total market range from 21 to 24, which is a 44 % increase from the year prior.

Source: IndustryWeek