After decades operating under misguided notions of globalization, the global credit crisis and financial collapse has grimly and assuredly dashed the notion that the US economy could prosper strictly as a service economy without a strong manufacturing sector. Countries need to make tangible products for a healthy, robust economy to sustain middle class jobs. Unfortunately, the demise of GM and Chrysler characterize the bleak state of manufacturing in the US. Will solar be similar to automobiles or semiconductors with manufacturing overwhelmingly centered in Asia
The Obama administration’s stimulus package offers the hope of a new era of “green” jobs. But just how realistic are these expectations for a boon in high-pay, high-value jobs in clean and green tech? While the US might still be able to out-innovate the world, won’t manufacturing jobs gravitate to low-cost, low-wage locations in Asia like they do in semiconductors, consumer electronics, and many other industries? China already leads the world in PV cell production. How can the US compete?
The fact is, solar photovoltaic (PV) energy is an excellent job-creator, but will require smart policies to significantly benefit both US employment and fossil fuel reduction. Many observers have concluded that solar energy is the most efficient and efficient job creator among all energy alternatives. Every step in the value chain—from the development, manufacturing, sale, support and installation of solar panels--require smart, well educated, well-paid people. EPIA estimates that 10 jobs are created per MW in manufacturing. By 2030, solar energy is estimated to create as many as 10 million jobs, but how many of these will be in the US; and how many in manufacturing?
One of the primary reasons why, unlike semiconductors, solar can be efficiently and practically made in the US are the simple fact that solar photovoltaic panels are large and heavy. While based on the same technology as semiconductors, solar panels benefit enormously from being manufactured close to their customers. The cost of shipping and installing a PV panel today is as much as 40% of the total cost, growing to 60% by 2020. Germany enjoys a healthy manufacturing base in solar and we saw significant investment in Spain as they established tariff incentives. Every analyst agrees that US will become of most of the biggest consumers of solar energy in the world and the natural advantages of manufacturing close to the customer base favors US-based cell and module production.
Another factor that can to lead to job creation is that the future PV industry leaders will be technology leaders and the US leads the world in The US leads the world in innovation and technology. While much of the world leaders in PV production are based in China and Europe, the vast amount venture capital, patents, and future innovations in solar probably reside in the US. North American companies raised $5.9 billion in “clean tech” venture capital in 2008 accounting for close to 70% of the world investment total. Nearly 100 new cell and module companies have been formed in the US. Bridging the gap between innovation and production—or between “invented in the USA” and “Made in the USA”—should be the chief concerns of policy makers at the local, State, and Federal levels.
America’s manufacturing renaissance in solar energy will also require a large, healthy, innovative supply chain of cell manufacturers, equipment, and materials suppliers. With a head start by European and Chinese suppliers, that US-based supply chain necessary for world leadership and job creation is currently behind, but catching up quickly. Among cell and module manufacturers, First Solar and SunPower are among the world leaders today, and new firms such as Solyndra have interesting prospects for continued growth. Many of the emerging technologies in solar in printed and organic technologies, III-V compounds and DSS are based in the US. And, equipment and materials suppliers such as Applied Materials, Hemlock, DuPont, and KLA-Tencor that helped create the most successful chip industry are also based in the US.
The dynamics that led the chip industry to move production to Asia don’t have to be repeated in solar. While American innovations in notebook computers, digital music players, mobile phones, and advanced semiconductors are today all manufactured in Asia. solar PV can be different. Because of the importance of shipping costs, automation and technology, the emergent solar industry can keep the manufacturing jobs in the US--with the right programs, policies and vision in place.
The Obama administration’s stimulus package offers the hope of a new era of “green” jobs. But just how realistic are these expectations for a boon in high-pay, high-value jobs in clean and green tech? While the US might still be able to out-innovate the world, won’t manufacturing jobs gravitate to low-cost, low-wage locations in Asia like they do in semiconductors, consumer electronics, and many other industries? China already leads the world in PV cell production. How can the US compete?
The fact is, solar photovoltaic (PV) energy is an excellent job-creator, but will require smart policies to significantly benefit both US employment and fossil fuel reduction. Many observers have concluded that solar energy is the most efficient and efficient job creator among all energy alternatives. Every step in the value chain—from the development, manufacturing, sale, support and installation of solar panels--require smart, well educated, well-paid people. EPIA estimates that 10 jobs are created per MW in manufacturing. By 2030, solar energy is estimated to create as many as 10 million jobs, but how many of these will be in the US; and how many in manufacturing?
One of the primary reasons why, unlike semiconductors, solar can be efficiently and practically made in the US are the simple fact that solar photovoltaic panels are large and heavy. While based on the same technology as semiconductors, solar panels benefit enormously from being manufactured close to their customers. The cost of shipping and installing a PV panel today is as much as 40% of the total cost, growing to 60% by 2020. Germany enjoys a healthy manufacturing base in solar and we saw significant investment in Spain as they established tariff incentives. Every analyst agrees that US will become of most of the biggest consumers of solar energy in the world and the natural advantages of manufacturing close to the customer base favors US-based cell and module production.
Another factor that can to lead to job creation is that the future PV industry leaders will be technology leaders and the US leads the world in The US leads the world in innovation and technology. While much of the world leaders in PV production are based in China and Europe, the vast amount venture capital, patents, and future innovations in solar probably reside in the US. North American companies raised $5.9 billion in “clean tech” venture capital in 2008 accounting for close to 70% of the world investment total. Nearly 100 new cell and module companies have been formed in the US. Bridging the gap between innovation and production—or between “invented in the USA” and “Made in the USA”—should be the chief concerns of policy makers at the local, State, and Federal levels.
America’s manufacturing renaissance in solar energy will also require a large, healthy, innovative supply chain of cell manufacturers, equipment, and materials suppliers. With a head start by European and Chinese suppliers, that US-based supply chain necessary for world leadership and job creation is currently behind, but catching up quickly. Among cell and module manufacturers, First Solar and SunPower are among the world leaders today, and new firms such as Solyndra have interesting prospects for continued growth. Many of the emerging technologies in solar in printed and organic technologies, III-V compounds and DSS are based in the US. And, equipment and materials suppliers such as Applied Materials, Hemlock, DuPont, and KLA-Tencor that helped create the most successful chip industry are also based in the US.
The dynamics that led the chip industry to move production to Asia don’t have to be repeated in solar. While American innovations in notebook computers, digital music players, mobile phones, and advanced semiconductors are today all manufactured in Asia. solar PV can be different. Because of the importance of shipping costs, automation and technology, the emergent solar industry can keep the manufacturing jobs in the US--with the right programs, policies and vision in place.
Posts
