November 17th, 2011


CTO, SunPower

Former CEO, Solaria


In the wake of the collapse of solar panel maker Solyndra, the solar industry has received sustained front-page treatment for the first time. Unfortunately, most of the coverage has been negative and ill-informed. In danger of being lost, industry veterans Dan Shugar and Tom Dinwoodie told a Climate One audience on November 17 is the good news – that solar is one of the fastest-growing industries in the United States.

Dan Shugar, CEO, Solaria, offered a sense of the scale of the growth. “Solar is, for the last 10 years, the fastest-growing energy technology,” he said, recording 69 percent annually compounded growth, 10 years in a row. “Last year, our industry manufactured, shipped, and installed for homes, businesses, and power plants 17 gigawatts of power. That’s the daytime equivalent of what 17 nuclear power plants put out.”

“Solar is the shining example of how technology innovation has enabled us to reduce cost and solve our energy needs in a renewable and attractive way,” he said.

Tom Dinwoodie, CTO, SunPower, added that even assuming a slower annual growth rate, say 15 percent, solar could supply 100 percent of the United States’ electricity requirement by 2040. “As we replace our aging fossil plants and nuclear plants over the coming 10, 20, 30 years, solar and wind will be ideal replacements,” he said.

“In the last three years, if you just look at North America, there’s been three times more wind and solar installations, in megawatts installed, than coal,” said Dan Shugar. “This is a real industry. It’s true it’s still a relatively small percentage of the total. But if you look at it, it’s a huge percentage of what’s been built in the last few years, and what’s going to be built.”

Dinwoodie and Shugar also addressed two recent events that have buffeted the industry – German firm SolarWorld’s WTO complaint alleging that Chinese state support has facilitated the flooding of the market with low-cost panels, and the Solyndra bankruptcy. Yes, the SolarWorld dumping complaint has divided the industry, said Dinwoodie – firms purchasing the Chinese panels are benefitting from low prices; U.S.-based panel manufacturers, meanwhile, are hurting, with some filing for bankruptcy.

“I think it’s a temporary phenomenon,” he went on. “You’ll see demand in the world pick up as a result of these low costs, and there will be more a supply-demand balance in the future.”

“I think there are really valid concerns on both sides of the debate,” added Dan Shugar. His firm did not join the WTO complaint. “We share some of the concerns, but we felt it was quite a blunt instrument,” he said.

Overlooked in media coverage of the issue, he added, is that China maintains a 17 percent import duty on foreign panels. “We think having a conversation and trying to level the playing field would be the right way to go about equalizing that,” he said.

On Solyndra, Dinwoodie said the firm “is basically a victim of the success of the solar industry.” “The government made an investment in Solyndra, along with some very smart and savvy venture capitalists – and they made a bad bet,” he said. “Whether the government should be betting on individual companies is a matter for public debate.”

Remember, said Dan Shugar, that Solyndra’s loan guarantee, even at $535 million, represented just 2 percent of the Department of Energy loan guarantee portfolio. The real issue, he argued, is that “in a capital-starved economy, which is what we are now, it’s very difficult to get loans for proven manufacturing entities.” The U.S. needs to learn from Malaysia, which built a domestic semiconductor industry, and China, which did the same for solar, by providing firms access to low-cost capital.

“I think it’s very smart. We should be doing the same thing,” he said.

– Justin Gerdes
November 17, 2011
Photos by Ed Ritger
The Commonwealth Club of California