Thoughts on Solyndra and all the solar headlines from last month
Posted on September 08, 2011 by Hector Tantoh in Articles

Unless you have been living in a vacuum for the past week, anyone who is even remotely interested in the solar industry, and has an internet connection knows that the month of August was an interesting one for the industry to say the least: Evergreen Solar filed for Chapter 11 Bankruptcy, Solon closed its Tucson, AZ plant, and of course the biggest headline grabber was Solyndra filing for bankruptcy after roughly a billion dollars in venture capital (VC) money and over another 500 million in Department of Energy (DOE) grants.

All the different news and social media outlets were buzzing with these headlines, rightfully so, and the Solyndra chatter does not seem to be losing steam.  One seemingly recurring theme, amidst all the discussion, was that some people treated these headlines as an indictment of the renewable industry as a whole and the solar industry in particular.

However when one considers how young the solar industry in the US is and how rapidly it is changing, that type of thinking seems premature.  If you ask most industry experts, or anyone who is knowledgeable about the solar industry, they say that the industry will go through a lot of changes over the next couple of years, as is the case with any young innovation driven industry.  Some companies will go out of business, others will get acquired and new players will enter the market place. This is to be expected and therefore when it does happen should be viewed for what it is, the market place going through a natural evolution, as opposed to an indicator that the entire industry is going away. 

Consumer Tech start-up companies go out of business and file for bankruptcy all the time and so do many other businesses in different sectors of our economy.  Solyndra was a company in a young industry that was betting on a unique technology to survive. Its technology was cost prohibitive, but this was only because the industry as a whole figured out a way to drop costs. In the big picture the industry is better off (the role of China in the dropping of these costs is a topic onto itself that will take more than a blog posting to address).

The conversation surrounding the Solyndra bankruptcy seems to have moved on from the fact that a solar company failed to the level of government involvement in the funding of the company. I am not an expert on the details of the DOEs funding and how companies are vetted, but one thing that some commentators have done a good job of pointing out is that the government invested in, and supported many technologies that we use today.

Overall no one knows exactly what will happen in the future, but for right now the solar industry is changing the way most new industries evolve.  There will be more manufacturer shake ups and more price fluctuations and the roles of distributors and contractors will continue to evolve.  However a few headline grabbing stories should not distract from the fact that the industry has come a long way in the USA in just a few years and has tremendous future growth potential.

*WESCO Distribution is not a distributor of Solyndra product