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Energy Update: The Solar Industry and Partisan Politics

by Newsteam Staff
June 7, 2012

An Amonix field engineer visually inspects solar panel cells at the Lyle Center on the Cal Poly Pomona campus in Pomona, California January 17, 2012 (Alex Gallardo/Courtesy Reuters). The Lyle Center on the Cal Poly Pomona campus in Pomona, California in January 2012 (Alex Gallardo/Courtesy Reuters).

Energy independence and investment in alternative energy have been major issues of Barack Obama’s presidency and his 2012 campaign. In a recent speech, President Obama boasted that the United States has nearly doubled its use of solar and wind energy on his watch.

But GOP challenger Mitt Romney and the right have hit hard on the failure of Solyndra, a thin-film solar cell company that went bankrupt in 2011 after receiving federal loan guarantees as part of the 2009 stimulus package. GOP presidential candidate Mitt Romney recently blasted the Obama administration’s approval of the Department of Energy loan guarantee, saying it was a conflict of interest and showed poor economic judgment (NYT).

However, Konarka Technologies, a Massachusetts-based thin-film solar company that Romney gave a $1.5 million loan as governor recently filed for bankruptcy, opening Romney to comparable attacks from the Obama camp (Politico).

High polysilicon prices initially made Solyndra and other companies, like Konarka, that used alternative materials attractive before the prices of polysilicon started to fall in 2008, says Mike Orcutt, editor of The New Fuelist. “Fast forward to 2011. Polysilicon prices have fallen even lower, and the resulting flood of cheap silicon solar panels has transformed the market in a bad way for Solyndra, one of many reasons it goes bankrupt,” Orcutt says.

In an effort to prevent U.S. companies from being pushed out of the market by cheap solar panels imported from China, the U.S. Commerce Department decided last month to impose a 31 percent anti-dumping tariff on solar panels imported from China. The Chinese government strongly criticized the move (WSJ).

Such tariffs could backfire, writes David Nicklaus at the St. Louis Dispatch making solar energy overall less affordable in the United States, killing green jobs and angering an important trade partner. “Chinese manufacturers can avoid the tariff simply by shifting their solar-cell manufacturing to other countries, such as Taiwan and South Korea,” Nicklaus says. “If that’s the case, the Chinese firms’ solar panels will be only slightly more expensive than they are now, and they will continue to gain market share.”

For more on the candidates’ positions check out CFR’s Issue Tracker on The Candidates on Energy Policy.

Suggested Other Reading:

In an editorial, Bloomberg says the United States should be more concerned about energy policy and “fostering the adoption of clean, non- carbon-based energy, including solar,” and less concerned about politics and where clean energy technology comes from.

CFR’s Michael Levi explains that the global solar photovoltaic (PV) energy industry is maturing, but still finding its voice. “People are slowly shifting from a mentality where their goal is to sell solar cells to one where they are thinking about providing solutions to specific consumer needs,” he writes.

– Gayle S. Putrich, Contributing Editor

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