Despite the highly publicized bankruptcy of solar energy firm Solyndra, the solar industry posted record growth last year, a fact that has received far less attention. CNN reports that the industry saw a 6.8% increase in jobs, nearly ten times that of the overall energy economy. The industry has grown 300% since 2006 (with annual growth rates over 45% each year) and employs more than 100,000 Americans. The failure of one firm does not an industry failure make—as Peter Lehner of the NRDC points out, Solyndra was just 1 in 40 recipients of DoE loan guarantees, and represents only 2.9% of its energy loan portfolio.
The Solyndra scandal has been entirely blown out of proportion (it was “the royal wedding of climate stories” according to Joe Romm) and taken as evidence that solar energy itself is an unviable, unsustainable energy solution. As Nathaneal Greene of the NRDC points out, the failure of Solyndra should point to a need for more, not less, investment in solar energy, if one really looks at the facts.
Instead, the mechanisms of politics mean that when a policy fails, even if for a misjudgment in scale rather than direction, it is blacklisted forever (in political dog-years). Greene emphasises that Solyndra’s fault was not in being too ambitious and innovative, but in failing to keep up with the pace of industry-wide innovation. As he and other analysts point out, when one zooms out to the broader solar value chain, the U.S. is a net exporter of solar products, adding $1.9 billion to the economy last year, including a trade surplus in China.
But misrepresentation of the failure has made renewable energy a four letter word in Washington (much like “carbon tax” or “endangerment finding”). The Washington Post’s Wonkblog posted an excellent piece on the various myths and misconceptions surrounding the Solyndra failure. In the post, Brad Plumer demonstrates, among other things, that,
- The failure of Solyndra was, in part, due to a lack of thorough due diligence, but not necessarily a product of cronyism or partisanship.
- The solar industry is heavily under-invested in, both on a public and private level.*
- It was not all China’s fault—in fact, by focusing on complementary products rather than duplicating efforts, the U.S. can benefit from Chinese subsidies to solar technology.
California adopted the first comprehensive, statewide cap-and-trade system this past week. This is an extremely positive development, especially in such tough times in the environmental legislation and renewable energy spaces. A lot rides on the project, because were it to fail for any reason, it would set the federal process back several years. If it succeeds, however, there is certainly more than a glimmer of hope for the future of domestic climate legislation.
* I personally disagree with Plumer that the NIH has “sums lavished” on it that aren’t well allocated.