China moves in on Western solar power industries

 

China is emerging as the dominant force in the manufacture of solar panels in a world desperate for renewable sources of energy, as collapsing prices and disillusion over government subsidies has hobbled US efforts to take a lead in the development of the new industry.

Prices of solar panels have fallen by more than 40 per cent in the past year, as a result of increased manufacturing capacity and disappointing demand, and the US was reeling yesterday from news that taxpayers may have lost more than half-a-billion dollars on one solar energy firm that shut its doors this week.

Solyndra, whose plant was visited and praised by President Barack Obama last year, said it would file for bankruptcy protection in the next few days, making it the third US solar firm to go under in the past month. Solyndra had been the beneficiary of a Department of Energy loan guarantee programme funded by the Obama administration's economic stimulus in 2009, and loans from the Treasury department. In all, $527m (£326m) in taxpayer funding had been advanced to the company, along with about $1bn in private sector investment. More than 1,100 employees were told this week that they would be losing their jobs.

"This was an unexpected outcome and is most unfortunate," Solyndra's chief executive Brian Harrison said. "Regulatory and policy uncertainties" made it impossible to raise capital to quickly rescue the operation."

Also last month, Evergreen Solar, a Massachusetts firm which had once been a stock market darling, and SpectraWatt, a private firm spun out of Intel, said they were filing for Chapter 11 bankruptcy protection.

Congressman Henry Waxman of the House Committee on Energy and Commerce said the bankruptcies "are unfortunate warnings that the United States is in danger of losing its leadership position in the clean energy economy of the future. We should be doing everything possible to ensure the US does not cede the renewable energy market to China and other countries."

China manufactured about 40 per cent of the solar panels produced in the world last year, from a standing start five years earlier, and the largest single producer is a Chinese firm called Suntech Power Holdings.

Some in the US solar industry have criticised the Chinese for heavily subsidising their own firms, via grants of land for manufacturing plants and cheap loans. The United Steelworkers union filed a lawsuit last year asking the federal government to investigate China's clean energy subsidies and other policies and to pursue the matter through the World Trade Organisation.

But the shake-out in the US also reflects the collapsing prices for solar panels which has resulted from new production capacity in China, Malaysia and the Philippines, and from disappointing demand in Continental Europe, whose governments are most enthusiastically pushing solar power. Uncertainty over regulation of prices in Italy led to a sudden drop-off of demand there, and adoption was also slower than expected in Germany this year.

Shayle Kann, the managing director of GTM Research, said the US still has significant solar panel manufacturing players, such as First Solar, which is building a new plant in Arizona, but faces structural challenges that will inevitably lead to its losing market share to China, regardless of subsidies.

"There are significant low-cost and no-cost loans being granted to some manufacturers from the central government in China, but that is not true of all of them. It is one advantage among many," Mr Kann said. "Take away that government support and you would still have a similar trend, if not the magnitude. China has low labour costs, low utility costs, and a supply chain with the same benefits. In other words, the same benefits that low-cost manufacturing countries have anywhere."

Republican lawmakers criticised the Department of Energy programme of subsidies for solar companies and for the practice of the federal government trying to pick winners in new industries. The Obama administration defended the programme, which has disbursed $18bn in loans or loan guarantees, and its record to date.

Voices
voicesGood for Lana Del Rey for helping kill that myth, writes Grace Dent
News
The University of California study monitored the reaction of 36 dogs
sciencePets' range of emotions revealed
Life and Style
fashion Designs are part of feminist art project by a British student
Arts and Entertainment
The nomination of 'The Wake' by Paul Kingsnorth has caused a stir
books
PROMOTED VIDEO
Arts and Entertainment
The Tour de France peloton rides over a bridge on the Grinton Moor, Yorkshire, earlier this month
film
News
Snoop Dogg pictured at The Hollywood Reporter Nominees' Night in February, 2013
people... says Snoop Dogg
News
i100
Life and Style
food + drinkZebra meat is exotic and lean - but does it taste good?
Arts and Entertainment
Residents of Derby Road in Southampton oppose filming of Channel 4 documentary Immigration Street in their community
tv
Voices
voicesSiobhan Norton on why she eventually changed her mind
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
i100
Extras
indybest
Sport
Scottish singer Susan Boyle will perform at the Commonwealth Games opening ceremony in Glasgow
commonwealth games
Arts and Entertainment
Dwayne 'The Rock' Johnson stars in Hercules
filmReview: The Rock is a muscular Davy Crockett in this preposterous film, says Geoffrey Macnab
Life and Style
tech
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

PMO Analyst - London - Banking - £350 - £400

£350 - £400 per day: Orgtel: PMO Analyst - Banking - London - £350 -£400 per d...

Cost Reporting-MI Packs-Edinburgh-Bank-£350/day

£300 - £350 per day + competitive: Orgtel: Cost Reporting Manager - MI Packs -...

Insight Analyst – Permanent – Up to £40k – North London

£35000 - £40000 Per Annum plus 23 days holiday and pension scheme: Clearwater ...

Test Lead - London - Investment Banking

£475 - £525 per day: Orgtel: Test Lead, London, Investment Banking, Technical ...

Day In a Page

Noel Fielding's 'Luxury Comedy': A land of the outright bizarre

Noel Fielding's 'Luxury Comedy'

A land of the outright bizarre
What are the worst 'Word Crimes'?

What are the worst 'Word Crimes'?

‘Weird Al’ Yankovic's latest video is an ode to good grammar. But what do The Independent’s experts think he’s missed out?
Can Secret Cinema sell 80,000 'Back to the Future' tickets?

The worst kept secret in cinema

A cult movie event aims to immerse audiences of 80,000 in ‘Back to the Future’. But has it lost its magic?
Facebook: The new hatched, matched and dispatched

The new hatched, matched and dispatched

Family events used to be marked in the personal columns. But now Facebook has usurped the ‘Births, Deaths and Marriages’ announcements
Why do we have blood types?

Are you my type?

All of us have one but probably never wondered why. Yet even now, a century after blood types were discovered, it’s a matter of debate what they’re for
Honesty box hotels: You decide how much you pay

Honesty box hotels

Five hotels in Paris now allow guests to pay only what they think their stay was worth. It seems fraught with financial risk, but the honesty policy has its benefit
Commonwealth Games 2014: Why weight of pressure rests easy on Michael Jamieson’s shoulders

Michael Jamieson: Why weight of pressure rests easy on his shoulders

The Scottish swimmer is ready for ‘the biggest race of my life’ at the Commonwealth Games
Some are reformed drug addicts. Some are single mums. All are on benefits. But now these so-called 'scroungers’ are fighting back

The 'scroungers’ fight back

The welfare claimants battling to alter stereotypes
Amazing video shows Nasa 'flame extinguishment experiment' in action

Fireballs in space

Amazing video shows Nasa's 'flame extinguishment experiment' in action
A Bible for billionaires

A Bible for billionaires

Find out why America's richest men are reading John Brookes
Paranoid parenting is on the rise - and our children are suffering because of it

Paranoid parenting is on the rise

And our children are suffering because of it
For sale: Island where the Magna Carta was sealed

Magna Carta Island goes on sale

Yours for a cool £4m
Phone hacking scandal special report: The slide into crime at the 'News of the World'

The hacker's tale: the slide into crime at the 'News of the World'

Glenn Mulcaire was jailed for six months for intercepting phone messages. James Hanning tells his story in a new book. This is an extract
We flinch, but there are degrees of paedophilia

We flinch, but there are degrees of paedophilia

Child abusers are not all the same, yet the idea of treating them differently in relation to the severity of their crimes has somehow become controversial
The truth about conspiracy theories is that some require considering

The truth about conspiracy theories is that some require considering

For instance, did Isis kill the Israeli teenagers to trigger a war, asks Patrick Cockburn