Woe is the newly blossomed Solar Panel market which China has pulled the rug out from underneath, already

[Realitycheck]

Same story, different market. I mean, at this rate, why invest in anything if China is always going to be there, undercutting anything and everything? A number of companies received stimulus funding to help propel blossoming, more efficient solar technology among other green projects, only to be undercut by the Chinese, driving 5 of these solar companies into bankruptcy already, the biggest one to the tune of half a billion dollars. Of course, you can always say that research wasn't adequate enough to take into account the ever-present, looming, but hidden sweat-shop threat. I've been doing a little reading lately on the Chinese economic threat posed by such mismatches in economic development and what I read wasn't too encouraging. As China develops and becomes more wealthy, don't necessarily expect their monetary valuation to move into our favor. With a burgeoning Chinese market, they can afford to pay for a quality product that still undercuts our prices by 40%? So how do we address this mismatch in order to even the tables and compete? The headlines right now are that the funding was plowed through hurriedly right after the Bush administration had turned them down, but the Green revolution wasn't exactly part of Bush's gameplan anyway, so there's no guarantee it would have caught on anyway without a pronounced nudge into the Green age. The latest excuse is that we just need to improve the technology, but won't they just copy that to some degree? This is an old complaint/problem. What can we do?

[Phi for All]

How difficult would it be to mount a worldwide campaign to boycott Chinese products until they agree to respect patents and intellectual property?

[iNow]

Is there something preventing these companies from doing business in China? If that's where the action is, why not setup manufacturing there and sell to that gigantic market?

 

When it comes to solar companies failing in the US, I place the blame squarely on Congress who has failed to properly incentivize and protect that sector from the heavily subsidized and protected oil and coal industries.

Edited September 16, 2011 by iNow

[JohnB]

the heavily subsidized and protected oil and coal industries.

 

How is oil subsidised? I keep seeing this claim around the traps but can't seem to get an answer as to what these subsidies actually are. (Aside from silly claims that the existence of a road network is somehow an oil company subsidy)

[iNow]

We're calling it subsidized because they enjoy special tax reductions and benefits. Since the government is not collecting the same taxes from them that they are other energy sources, they have an unfair competitive advantage, and only the government can alter that toward cleaner sources. Right now, the tax breaks amount to about $4 billion per year.

 

 

http://www.forbes.com/2011/05/02/eliminate-oil-subsidies.html

 

The largest tax break at issue is a tax credit passed in 2005, which is available to all U.S. manufacturers. Oil and gas companies qualify for that credit, so they will likely deduct somewhere in the neighborhood of $18.3 billion from their tax bill over the next 10 years. Note that this isn't really an "oil subsidy"; it's a manufacturing subsidy that oil and gas companies--along with many other companies--enjoy.

 

 

http://www.nytimes.com/2010/07/04/business/04bptax.html

 

An examination of the American tax code indicates that oil production is among the most heavily subsidized businesses, with tax breaks available at virtually every stage of the exploration and extraction process.

 

According to the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.

 

And for many small and midsize oil companies, the tax on capital investments is so low that it is more than eliminated by var-ious credits. These companies’ returns on those investments are often higher after taxes than before.

 

“The flow of revenues to oil companies is like the gusher at the bottom of the Gulf of Mexico: heavy and constant,” said Senator Robert Menendez, Democrat of New Jersey, who has worked alongside the Obama administration on a bill that would cut $20 billion in oil industry tax breaks over the next decade. “There is no reason for these corporations to shortchange the American taxpayer.”

 

<....

 

“We’re giving tax breaks to highly profitable companies to do what they would be doing anyway,” said Sima J. Gandhi, a policy analyst at the Center for American Progress, a liberal research organization. “That’s not an incentive; that’s a giveaway.”

 

The NYTimes article has a lot of rather informative figures to assist in why so many of us see this as a problem, especially in context of getting clean energy sources off the ground.

[JohnB]

Thanks iNow. I'm still not sure I see the argument though. According to the NYT article;

 

Oil industry officials say that the tax breaks, which average about $4 billion a year according to various government reports, are a bargain for taxpayers. By helping producers weather market fluctuations and invest in technology, tax incentives are supporting an industry that the officials say provides 9.2 million jobs.

 

The American Petroleum Institute, an industry advocacy group, argues that even with subsidies, oil producers paid or incurred $280 billion in American income taxes from 2006 to 2008, and pay a higher percentage of their earnings in taxes than most other American corporations.

 

Proportionally $4 billion in tax breaks or whatever is small fish compared to $280 billion, I don't see how this can be construed as giving oil some sort of unfair advantage. Is oil paying $284 billion rather than $280 really going to make that much of a difference?

 

Similarly from the Forbes article;

But oil and gas companies have a point when they cry foul. After all, about 41% of the net income earned by the oil and gas industry is already paid out in federal taxes compared to 26.5% for the rest of the businesses in the S&P 500.

 

As they are already paying far more in taxes than most companies, how are they getting any sort of advantage?

 

As a general philosophical point I see no problem with giving an industry $4 billion in tax breaks if they generate a further $250 billion+ in taxes, whereas I find it just silly to give alternative energy say $200 million in subsidies to generate $100 million in taxes. Tax breaks are an investment in the economy and those that can contribute most to the economy are more worthwhile investing in. However I'd do it as a level thing with all tax breaks open to all companies, that is a level playing field. At the same time I find it silly to think that an industry paying $280 billion in taxes is really in need of the $4 billion in tax breaks.

 

What I do find interesting is that your Federal Excise taxes are extremely low. According to the IRS, Federal petrol taxes generated some $20 billion in 2000. (The figures are a bit dated) where in Australia last year the same tax was worth about $16 billion in excise. It seems very odd that a nation of 300 million can barely generate more excise income than a nation of 20 million.

 

I think that ours is way too high and yours is way too low. As of 2000 your tax was 18 odd cents per gallon where ours in 2006 was 38 cents per litre. Your Federal government should be getting a lot more in fuel excise than it does. (How's that for weird, a right winger saying taxes should go up. )

[waitforufo]

If you want solar power to be successful, you need to have cheap solar panels. If the Chinese want to subsidize the production of solar panels, and build them while paying their citizens at slave wages, so we can purchase them on the cheap, I say let them. If you think that employment in solar power generation will be dominated by solar panel manufacturers you're wrong. If that were true, solar power would never succeed. Employment in solar power will be dominated in installation and maintenance of both the panel arrays and the power distribution systems to which they are connected. There is no way that employment can be exported to China. It has to be done here. The cheaper solar panels are, the more of them there will be, and the more local employment there will be.

 

Look at the cell phone industry as an example. All that equipment is made in China. Because it is, we all have cell phones, cheap service, and lots of domestic employment. Local people build the cell sites, install and maintain the equipment, run the operating center, manage the billing, etc.

 

Wishing you could pay more so we can produce all of our own products will only produce less employment not more.

 

If solar power can't succeed with cheap Chinese solar panels and domestic subsidies for solar power generation, well then it will never succeed.

[iNow]

Proportionally $4 billion in tax breaks or whatever is small fish compared to $280 billion, I don't see how this can be construed as giving oil some sort of unfair advantage.

Because we're giving an established industry $4 billion which could just as easily be directed and focused toward sustainable energy sources. It's ultimately $4 billion not going to solar and wind.

 

I think you're making the wrong point by showing it as a small percentage of overall taxes paid by oil companies. The point is that they're being given an advantage their competitors are not receiving, and it's tilting the markets away from achieving a sustainable future more quickly.

 

Look at the cell phone industry as an example. All that equipment is made in China.

Well, actually the vast majority of equipment is manufactured outside of China, then shipped there for assembly, but whatever.

[swansont]

Same story, different market. I mean, at this rate, why invest in anything if China is always going to be there, undercutting anything and everything? A number of companies received stimulus funding to help propel blossoming, more efficient solar technology among other green projects, only to be undercut by the Chinese, driving 5 of these solar companies into bankruptcy already, the biggest one to the tune of half a billion dollars. Of course, you can always say that research wasn't adequate enough to take into account the ever-present, looming, but hidden sweat-shop threat. I've been doing a little reading lately on the Chinese economic threat posed by such mismatches in economic development and what I read wasn't too encouraging. As China develops and becomes more wealthy, don't necessarily expect their monetary valuation to move into our favor. With a burgeoning Chinese market, they can afford to pay for a quality product that still undercuts our prices by 40%? So how do we address this mismatch in order to even the tables and compete? The headlines right now are that the funding was plowed through hurriedly right after the Bush administration had turned them down, but the Green revolution wasn't exactly part of Bush's gameplan anyway, so there's no guarantee it would have caught on anyway without a pronounced nudge into the Green age. The latest excuse is that we just need to improve the technology, but won't they just copy that to some degree? This is an old complaint/problem. What can we do?

 

The problem with Solyndra was that by using an alternative material part its business model was based on silicon being expensive, which it was when the company was started up and when it got the loan. But prices have dropped — spot prices for solar-grade silicon were as high as $500/kg in 2008 (though most companies locked in lower long-term contract prices) and they are around $50/kg now. Companies have paid to break their supply contracts because of the price drop. Evergreen had a similar business model and suffered for similar reasons. These failures were probably less about labor costs as about material costs.

 

Solar is still an emerging industry. The dominant products have yet to be determined, so people are trying different approaches to see what works. Some will fail. No different from other emerging industries. Did you read this on your Wang or Tandy computer?

 

Look at a list of defunct auto companies in the US; most were in business only between ~1900 - 1920. It's staggering.

http://en.wikipedia.org/wiki/List_of_defunct_United_States_automobile_manufacturers

 

Computers are pretty impressive, too

http://en.wikipedia.org/wiki/List_of_computer_system_manufacturers#Defunct

[JohnB]

It's ultimately $4 billion not going to solar and wind.

 

And will it be better spent than the $500 million that went to Solyndra?

 

While I'm not opposed to subsidies per se, I think that there is a lot of lax thinking going on with energy, a lot of woolly, hopeful expectation. Subsidies are being argued for on the basis of "Let's go solar and when we have a lot of them the price will come down" and this may well be true, it could also be very untrue. The goal is wrong.

 

To my mind the goal of any subsidies for alternatives should be the supply of energy at cheaper than the current coal prices. Cheap and abundant energy is what our civilisation requires. Policies to increase the price of coal power or to artificially reduce the price of alternatives go against that goal because both actually increase the price to the consumer.

 

I certainly agree that the $4 billion should be removed from the oil companies. However when it comes to spending it I think it would be better to put it into R & D to improve the technology that can then be leased to the power companies rather than paying people to install inefficient current tech things.

[swansont]

And will it be better spent than the $500 million that went to Solyndra?

 

While I'm not opposed to subsidies per se, I think that there is a lot of lax thinking going on with energy, a lot of woolly, hopeful expectation. Subsidies are being argued for on the basis of "Let's go solar and when we have a lot of them the price will come down" and this may well be true, it could also be very untrue. The goal is wrong.

 

To my mind the goal of any subsidies for alternatives should be the supply of energy at cheaper than the current coal prices. Cheap and abundant energy is what our civilisation requires. Policies to increase the price of coal power or to artificially reduce the price of alternatives go against that goal because both actually increase the price to the consumer.

 

I certainly agree that the $4 billion should be removed from the oil companies. However when it comes to spending it I think it would be better to put it into R & D to improve the technology that can then be leased to the power companies rather than paying people to install inefficient current tech things.

 

There are areas of the US where solar is already same/cheaper than grid power (especially California and Hawaii). For homeowners, the problem is that if it costs $30k to install, most people won't do it, even if the electricity costs over the next 30 years are going to be $40k. People aren't willing to pony up the money. It's exacerbated by the aftermath of the housing bubble, because you can't charge a premium for a house with installed solar when foreclosed homes are selling at a discount. For utility-sized projects, you have the same problem, scaled up. Most of the costs are up-front — it's like building a coal plant and buying all the coal for the next 30 years, which is somewhere about 10-15% of the overall cost of the electricity. Even if it's a money-winner, you have to borrow that much extra to build the system.

[iNow]

And even with the unequal playing field and lack of subsidies, the cost of solar still went down 17% in 2010.

 

 

http://www.smartplanet.com/blog/smart-takes/cost-of-solar-in-us-dropped-17-in-2010-report-says/19286

 

The average cost of solar energy systems in the United States decreased by 17 percent in 2010 and another 11 percent in the first half of 2011 — a record drop, according to a new report.

 

According to a report released Thursday by the U.S. Department of Energy’s Lawrence Berkeley National Laboratory, market-building policies are driving pre-incentive solar system costs down, from reductions in the costs of installation labor to overhead costs.

 

“Both the long-term and more recent reductions in non-module costs suggests that PV deployment policies have achieved some success in fostering competition within the industry and spurring improvements in the cost structure and efficiency of the PV delivery infrastructure,” the authors write.

 

 

 

[waitforufo]

There are areas of the US where solar is already same/cheaper than grid power (especially California and Hawaii). For homeowners, the problem is that if it costs $30k to install, most people won't do it, even if the electricity costs over the next 30 years are going to be $40k. People aren't willing to pony up the money. It's exacerbated by the aftermath of the housing bubble, because you can't charge a premium for a house with installed solar when foreclosed homes are selling at a discount. For utility-sized projects, you have the same problem, scaled up. Most of the costs are up-front — it's like building a coal plant and buying all the coal for the next 30 years, which is somewhere about 10-15% of the overall cost of the electricity. Even if it's a money-winner, you have to borrow that much extra to build the system.

 

What you are talking about is generally called "the cost of money." You have to add the borrowing cost to the system cost to find the true cost. If you have the money, you have to add the lost opportunity cost of not investing the money in something else. At the moment both cost aren't too high since interest rates are low. Well that is if you can get a loan to improve your home / business. Such a calculation is however made more difficult when considering the 30 years you mention. What will interest rates be in five years? As an investor do you really want to lock your money up for 30 years, particularly when you consider how much natural gas they are discovering right here in the USA.

 

On another note, I'm glad to hear that iNow thinks that transferring assembly jobs to China is a "whatever."

[Saryctos]

Because we're giving an established industry $4 billion which could just as easily be directed and focused toward sustainable energy sources. It's ultimately $4 billion not going to solar and wind.

 

I think you're making the wrong point by showing it as a small percentage of overall taxes paid by oil companies. The point is that they're being given an advantage their competitors are not receiving, and it's tilting the markets away from achieving a sustainable future more quickly.

These companies also have to put up with regulations which limit their ability to operate efficiently. Opening a new solar panel factory? Sure why not. Open a new refinery? Hold the phone champ, isn't your county already at the maximum allowable*(not sure if this exact limitation exists)? From what I understand, many companies would be willing to update their defunct factory equipment that has been grandfathered in (ex: wooden pipes) in exchange for letting go of some of those subsidies.

[iNow]

On another note, I'm glad to hear that iNow thinks that transferring assembly jobs to China is a "whatever."

Nothing I posted spoke of my feelings or thoughts about jobs in China. I was merely pointing out an inaccuracy in your thesis.

[iNow]

These companies also have to put up with regulations which limit their ability to operate efficiently. Opening a new solar panel factory? Sure why not.

This suggests you're not aware of the fact that solar manufacturing involves a lot of hazardous waste and toxic chemicals such as hydrogen flouride, nitric acid, sulfuric acid, and sodium hydroxide, and that these facilities are subject to many of the same regulatory, safety, and approval requirements as semiconductor or wafer fabs. Manufacturers who are opening plants to produce solar panels face similar regulations and requirements, and deal with similarly dangerous substances, so the "sure, why not?" comment you made (while humorous) is IMO rather invalid.

[waitforufo]

This suggests you're not aware of the fact that solar manufacturing involves a lot of hazardous waste and toxic chemicals such as hydrogen flouride, nitric acid, sulfuric acid, and sodium hydroxide, and that these facilities are subject to many of the same regulatory, safety, and approval requirements as semiconductor or wafer fabs. Manufacturers who are opening plants to produce solar panels face similar regulations and requirements, and deal with similarly dangerous substances, so the "sure, why not?" comment you made (while humorous) is IMO rather invalid.

 

Whether a refinery or a solar panel manufacturing plant these same regulatory, safety and approval requirements add to the cost of operating a business. Well, unless you put that business in a place that doesn't have such regulatory, safety or approval requirements. You know, like China.

 

So I guess it comes down to the lifestyle choice differences that nations like China and the US choose to make. In the US we choose to enjoy clean water and air while watching our manufacturing base decline. In China, where they run power plants with anything that will burn, clean water an air take a back seat to employment.

 

Still our choice is not a bad one. We get to enjoy the advantages of low cost goods which spawn significant employment in the service sector while enjoying the benefits of a better environment and safer working conditions. Yes, we pay the price of having fewer manufacturing jobs, but you have to pay for what you want.

 

China on the other hand values human life less than we do, so the political stability of improving employment, to the political elite running China, seems worth the cost of a poor environment and reduced work place safety.

 

This choice by China improves our standard of living by providing goods a significantly lower cost. We can then choose to spend these savings on leisure, or perhaps installing one of those new fangled cheep Chinese solar panel arrays on the roofs of our homes. I, of course, will choose to spend mine burning gasoline in my many internal combustion engines while also enjoying the comfort of cheep natural gas.

 

Isn't it great to live in a free country where we can choose for ourselves?

[JohnB]

Sorry guys, I'm still not getting it with unequal subsidies.

 

I think we agree that a well established industry that pays $280 billion doesn't need the $4 billion in breaks, that to me is a given.

 

However oil etc which provide virtually all of your transport power, more than half of electricity production and Thor only knows how many jobs gets $4 billion while the renewables that are lucky to make 1% of energy get how much? (Solyndra got $500 million) It strikes me that when compared to actual production, the renewables get far more than the established companies. To me it's like saying that if the US gov gave California $10 billion and Montana $5 billion then Montana is missing out, when percapita Montana would be getting more than 30 times as much. From my POV and looking at what is contributed to the grid, renewables are getting a lot more money than the established energy companies.

 

And the question has to be asked "What is the point? Is it worth it?". Short of some magical development that increases energy production from renewables, they simply won't play a major part in supplying power to the grid.

 

Using the 2006 figures from Wiki Solar, Wind and Geothermal between them supplied 1.1% of energy in the US compared to coals 49.1%, so coal used 1,460 power plants to provide 44 times as much power as 31 Solar Plants, 215 Geothermal and 341 Wind power stations. This means that to replace just coal using existing technology (and assuming the same mix of generators) will require 1,383 Solar Plants, 9,597 Geothermal stations and 15,221 Wind power stations, nearly 25,000 power stations.

 

Now we have to add in siting factors. Coal stations can be placed pretty much anywhere that you can get coal and water to but Solar needs to be placed where the sunshine is good, Geothermal where the geology is right and Wind where the wind blows well, severely limiting where these plants can be placed. How much of your National Park area are you willing to sacrifice? My guess is none, if the choice is a wind farm or National Park the park will win every time. (It would with me too. If somebody wanted to bulldoze part of a National Park for a wind farm or a mine, I'd be against it.)

 

So the technology limits the amount of power per station and geography and local conditions limit where the stations can be placed. Let's look at a more modest proposition, say 10% renewables. Can you actually find the space to place 300 Solar plants, 950 Geothermal stations and 3,400 Wind power stations without sacrificing National Parks and wilderness areas? I doubt it. (but it would be interesting to find out) Off the top of my head I would expect that it would need a good 500% increase in power generation per acre of land used to make renewables viable for baseload grid power, otherwise the numbers just don't add up. So I ask again "Is it worth it?". Rather than renewables might the money not be better spent on next gen nukes or fusion research?

 

It might seem that I'm arguing for coal, but I'm not, I'm looking at the limitations of different power generation methods. Some are very wasteful in terms of infrastructure, including coal. Consider the Wiki page again. Why on Earth have 649 coal fired plants with individual outputs of less than 100 MW? (465 of them less than 50MW) The rail and road requirements to fuel that many stations is enormous and wasteful. Choose carefully and expand some of them to 1000 MW (or build some new 1000 MW ones) and for each one expanded or built you can bulldoze 19 small stations. (Expand 23 of the small ones to 1000 MW and you can bulldoze all the rest.) This to me makes both economic and ecological sense. The idea being to produce power as cheaply as possible while chewing up the minimum of available land, it's a trade off.

 

I look at it this way. To the north of me is Tarong, covering about 144 square kilometres, including the mine that feeds it, it's an area about 12 km x 12 km and produces 1,400 MW of baseload power. Further to the north near Townsville is our largest wind farm at Windy Hill. Windy Hill covers 2 and a bit square km to produce 12 MW of power. Now if Windy Hill was expanded to the size of Tarong it would only produce 1/2 the power and none of it would be baseload. So yes, I would rather have a single power station stuck in the middle of nowhere producing sh*tloads of baseload than to clear fell hundreds of square kms of National Park and State forest for wind farms. And I have no interest in "offshore" wind. "Offshore" here means the Great Barrier Reef and there is no way I will support wind farms or oil rigs out there. I'll be underwater planting dynamite with the more radical greenies on this one.

[swansont]

Sorry guys, I'm still not getting it with unequal subsidies.

 

I think we agree that a well established industry that pays $280 billion doesn't need the $4 billion in breaks, that to me is a given.

 

However oil etc which provide virtually all of your transport power, more than half of electricity production and Thor only knows how many jobs gets $4 billion while the renewables that are lucky to make 1% of energy get how much? (Solyndra got $500 million) It strikes me that when compared to actual production, the renewables get far more than the established companies. To me it's like saying that if the US gov gave California $10 billion and Montana $5 billion then Montana is missing out, when percapita Montana would be getting more than 30 times as much. From my POV and looking at what is contributed to the grid, renewables are getting a lot more money than the established energy companies.

 

And the question has to be asked "What is the point? Is it worth it?". Short of some magical development that increases energy production from renewables, they simply won't play a major part in supplying power to the grid.

 

Using the 2006 figures from Wiki Solar, Wind and Geothermal between them supplied 1.1% of energy in the US compared to coals 49.1%, so coal used 1,460 power plants to provide 44 times as much power as 31 Solar Plants, 215 Geothermal and 341 Wind power stations. This means that to replace just coal using existing technology (and assuming the same mix of generators) will require 1,383 Solar Plants, 9,597 Geothermal stations and 15,221 Wind power stations, nearly 25,000 power stations.

 

Now we have to add in siting factors. Coal stations can be placed pretty much anywhere that you can get coal and water to but Solar needs to be placed where the sunshine is good, Geothermal where the geology is right and Wind where the wind blows well, severely limiting where these plants can be placed. How much of your National Park area are you willing to sacrifice? My guess is none, if the choice is a wind farm or National Park the park will win every time. (It would with me too. If somebody wanted to bulldoze part of a National Park for a wind farm or a mine, I'd be against it.)

 

So the technology limits the amount of power per station and geography and local conditions limit where the stations can be placed. Let's look at a more modest proposition, say 10% renewables. Can you actually find the space to place 300 Solar plants, 950 Geothermal stations and 3,400 Wind power stations without sacrificing National Parks and wilderness areas? I doubt it. (but it would be interesting to find out) Off the top of my head I would expect that it would need a good 500% increase in power generation per acre of land used to make renewables viable for baseload grid power, otherwise the numbers just don't add up. So I ask again "Is it worth it?". Rather than renewables might the money not be better spent on next gen nukes or fusion research?

 

Solyndra only "got" $500 million because they went bankrupt. It was a loan guarantee, not a grant, I'm not sure how clear it is how much the government will have to pay.

 

One advantage of solar is that it can be a distributed energy source. A 1000 MW coal plant needs to get that electricity to the grid, and the grid needs the ability to send it where it needs to go. Residential and commercial solar are generated at the place they use the electricity, reducing the load on the grid. As far as industrial solar (or wind), there are plenty of areas to put that which do not include national parks.

 

Also, as far as the California/Montana analogy goes, it's a matter of it being a zero-sum game in this environment, and you are doling out money for snow plows. It's not about per-capita spending, it's need-based. Where will the money have the most effect?

[iNow]

Whether a refinery or a solar panel manufacturing plant these same regulatory, safety and approval requirements add to the cost of operating a business. Well, unless you put that business in a place that doesn't have such regulatory, safety or approval requirements. You know, like China.

 

In the US we choose to enjoy clean water and air while watching our manufacturing base decline. In China, where they run power plants with anything that will burn, clean water an air take a back seat to employment.

 

I know it's fun and easy and even somewhat Pavlovian for you to continually scapegoat China as the big bad bogeyman, but you are yet again working from an invalid premise. I strongly encourage you to check your facts before you continue drawing conclusions based upon them.

 

 

http://www.solarserver.com/solar-magazine/solar-news/current/2011/kw05/china-imposes-new-regulations-on-polysilicon-production.html

 

On January 24th, 2011 the Chinese Ministry of Industry released new financial, efficiency and environmental standards for polysilicon plants, including setting a minimum plant size of 3,000 metric tons per year for new solar grade polysilicon facilities and plant expansions. The regulations released cover both solar grade and semiconductor grade polysilicon, with different standards for each.

 

<...>

 

Under the new regulations, polysilicon plants must not use more than 80KWh of electricity for every kilogram of polysilicon produced. This efficiency standard will be tightened to 60KWh per kilogram by 2011. The Ministry also states that it will eliminate polysilicon production lines by 2011 which consume more than 200KWh/kg of polysilicon.

 

New plants must also observe certain environmental regulations, including a requirement that plants recycle at least 95% of water used, 98.5% of tetrachloride gas and 99% of hydrogen chloride and hydrogen. The Ministry states that plants must not occupy more than 60 square meters for every metric ton of polysilicon produced, and that it will not approve new plants within one kilometer of farmland, nature reserves, scenic areas or concentrated residential areas.

 

 

Just to be clear here, the above shows your assertion to be false, no matter how you slice it, especially in context of this thread and the discussion to which you're responding.

 

Additionally, implicit in your comment (again, in context of this thread and the actual discussion we're having) is the suggestion that US solar companies are failing because they have to follow EPA regulations and spend more on environmental protection and cleanup than they do in China. For the sake of argument, let's just assume for a moment that your premise is valid (it's not, as shown by my source above and others I could provide which you'd ignore... but hey... let's assume it is valid). You're essentially arguing that an extra $20K to $40K per quarter in costs to these companies like Solyndra is keeping those companies from being competitive in a multi-billion dollar industry. It truly strains credulity how you could hold such a position. When a difference in margins of plus or minus $0.00004 per hundred units can make or break a sector (like we see so often with Walmart), then maybe you'd have an actual point worth exploring, but that's not the case with solar manufacturing in the same way it's not the case with other semiconductors or other LCD and thin film products.

 

Frankly, Solyndra didn't fail because of lax environmental regulations in China. They failed because they were using thin film technologies in a market where the cost of crystalline silicon (a much more efficient energy capture technology based on today's technology) decreased. The cost per watt of thin film jumped relative to the cost per watt of crystalline which really decimated the entire thin film market, not just Solyndra. Further, based on information which is readily available in nearly every major news outlet, Solyndra failed because they could not achieve the necessary operational cost reductions and improved throughput when scaling.

 

 

And... you know what? China is doing well in the solar industry because... wait for it... they're recognizing the importance of this market, the role it will play in the future, and the huge demand there is for these products and so are heavily subsidizing and helping the industry, not because companies there can dump chemicals out their back door.

 

 

http://www.solarenergyexperts.co.uk/b-china-sun-what-the-influx-of-chinese-solar-panels-means-for-the-industry

 

Chinese manufacturers have benefitted from tax incentives, cheap land, training programmes, education and subsidies. Manufacturing, across the Chinese economy, now accounts for 25% of GNP, compared to 11.7% The Chinese also know very well that renewable energy is the next big growth industry. They have been gearing themselves up to meet the challenge with the China Development Bank offering over $30 billion in financial support to Chinese solar panel manufacturers. That is around 20 times the amount of finance offered in the US.

 

You don't need to invoke bigoted generalizations or out-dated stereotypes to explain why Solyndra failed. It's rather clear that they got their ass kicked in a market which is being intentionally driven and powerfully supported by nearly every major advanced nation on the planet except the United States.

 

 

 

China on the other hand values human life less than we do

These comments have no place in a discussion like this. They are ignorant, insulting, and inaccurate as well.

 

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Sorry guys, I'm still not getting it with unequal subsidies.

Try not to forget to include the impact and scale of subsidies to solar from other countries competing in the sector when you're doing your arithmetic. Part of your confusion seems to be an attempt to view the US economy in isolation from the rest of the world.

Edited September 18, 2011 by iNow

[swansont]

So I guess it comes down to the lifestyle choice differences that nations like China and the US choose to make. In the US we choose to enjoy clean water and air while watching our manufacturing base decline. In China, where they run power plants with anything that will burn, clean water an air take a back seat to employment.

 

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China on the other hand values human life less than we do, so the political stability of improving employment, to the political elite running China, seems worth the cost of a poor environment and reduced work place safety.

 

China has more installed wind generation than the US does, more hydro and are committing to installing a bunch of solar in the next few years; if we change nothing it won't take long for them to surpass us. Despite their larger population, their electricity use is comparable to the US's (i.e. per capita it's about a quarter of ours)

 

At best, I'd say that China's attitude toward safety mirrors the US attitude of several decades ago. It's not as if all US manufacturers volunteered to make places safer and pollute less — that was won by workers demanding safer conditions (in part via collective bargaining) and people exerting political pressure. Similar things are happening in China. One might also note that there are some who currently wish to un-do some of these regulations in the US in the name of profits. Anyone calling for shutting down the EPA, for example, or weakening worker rights.

[waitforufo]

I know it's fun and easy and even somewhat Pavlovian for you to continually scapegoat China as the big bad bogeyman, but you are yet again working from an invalid premise. I strongly encourage you to check your facts before you continue drawing conclusions based upon them.

http://www.solarserver.com/solar-magazine/solar-news/current/2011/kw05/china-imposes-new-regulations-on-polysilicon-production.html

 

Perhaps 2007 seems like ancient history to you, but a quick check on Google found this NYT article.

 

http://www.nytimes.com/2007/08/26/world/asia/26china.html?pagewanted=1

 

Perhaps I simply understand that in China the people that write the pollution regulations and the people that pollute are one in the same. It's easy to write regulations that no one follows.

 

You don't need to invoke bigoted generalizations or out-dated stereotypes to explain why Solyndra failed. It's rather clear that they got their ass kicked in a market which is being intentionally driven and powerfully supported by nearly every major advanced nation on the planet except the United States.

Again I have no problem from benefiting from the expenditures of " nearly every major advanced nation" if, and that is a big if, solar power because a major supplier of electrical power.

 

China has more installed wind generation than the US does, more hydro and are committing to installing a bunch of solar in the next few years; if we change nothing it won't take long for them to surpass us. Despite their larger population, their electricity use is comparable to the US's (i.e. per capita it's about a quarter of ours)

 

They are also building and operating lots of coal power plants as well. I have been to both Shanghai and Beijing, so I don't need any further source on how well they scrub there smokestack emissions.

 

At best, I'd say that China's attitude toward safety mirrors the US attitude of several decades ago. It's not as if all US manufacturers volunteered to make places safer and pollute less — that was won by workers demanding safer conditions (in part via collective bargaining) and people exerting political pressure.

Several decades ago our economy had a much larger manufacturing base. Thanks for making my point.

 

 

Similar things are happening in China. One might also note that there are some who currently wish to un-do some of these regulations in the US in the name of profits. Anyone calling for shutting down the EPA, for example, or weakening worker rights.

 

When these similar things succeed in China, we will be able to compete more effectively with them and manufacturing jobs will move back to the US.

[iNow]

Perhaps 2007 seems like ancient history to you, but a quick check on Google found this NYT article.

You are correct. My source was from this year, not four years ago. Much has changed in that time, and current information is especially relevant given that we're talking about why some businesses have failed in the present, not before the current financial disaster even began.

Edited September 18, 2011 by iNow

[waitforufo]

You are correct. My source was from this year, not four years ago. Much has changed in that time, and current information is especially relevant given that we're talking about why some businesses have failed in the present, not before the current financial disaster even began.

 

Interesting. My reply was a comeback to your post on the wonderful environmental regulations in China's solar panel manufacturing industry. You counter with a comment on economics. I guess you wish we handled the environment like China does?

[iNow]

Interesting. My reply was a comeback to your post on the wonderful environmental regulations in China's solar panel manufacturing industry. You counter with a comment on economics. I guess you wish we handled the environment like China does?

Are you confused, or something? You're talking about Chinese environmental protections for solar manufacturing in the present. My previous source was from this year, about laws passed, and expectations from the government. Your argument has failed. You can dissemble and try to make personal comments about me all you like... You're quite simply wrong... again.