Eugen, comments? Both on the PV angle and the .de angle. :)
Udhay
http://www.salon.com/tech/htww/2007/06/28/german_solar/index.html
How the World Works
The German-Indian-Silicon Valley solar power solution
Call it a classic Silicon Valley globalization play. Signet Solar,
[14]a renewable energy startup headquartered in Palo Alto, Calif., has
already broken ground on a R&D facility in Dresden, Germany, and
announced this month that it would it would build [15]three
manufacturing plants in India. By combining its own proprietary
intellectual property with "thin solar" manufacturing equipment from
Silicon Valley's semiconductor tools giant, Applied Materials Inc.,
Signet hopes to grab market share by selling lower-cost photovoltaic
panels for large industrial applications. (Thanks to [16]The Indic
View for the tip.)
The venture capitalists behind Signet are betting that the promised
land of "grid parity" lies just beyond that next ridge. Grid parity
refers to that moment when the cost of electricity generated by solar
power matches the cost of electricity from conventional sources. Right
now, with government subsidies (and without internalizing the
environmental costs of burning fossil fuels), electricity generated by
solar power is at least twice as expensive as coal or natural gas. But
manufacturing costs have been falling for decades, and some industry
analysts are cautiously predicting that within five or ten years, grid
parity will arrive. At which point [17]a market that has been growing
like gangbusters for a decade will go absolutely bonkers.
Whether or not Signet will be one of the winners in a marketplace that
welcomes formidable new entrants seemingly every day is anybody's
guess. But that's not why Signet's basic business plan caught my eye.
Take another look -- the R&D facilities are in Germany.
Who offshores to Germany? India may be better known for its software
expertise, but setting up manufacturing plants there still makes sense
-- labor and land are cheaper, Signet's management team is dominated
by executives with Indian backgrounds, and the market for solar power
in the near future is likely to be huge.
But Germany is not well known as a cheap outsourcing solution. So
what's going on?
The answer is that Germany is [18]a hotbed of solar power technology.
The decision to locate Signet Solar's R&D facility in Dresden is in
large part because [19]Applied Materials already has a plant nearby.
Applied Material's thin solar manufacturing process [20]is based on
German technology that the company purchased in 2006.
Germany turns out to be a world leader in both solar and wind power
technology, and there's a simple reason why: [21]Government incentives
and subsidies.
The support has come in many forms, from direct funding of research
and development to friendly tax breaks. But probably the most
important strategy employed by the government was the requirement that
power utilities buy renewable energy at a fixed price that made
investing in new technologies automatically profitable.
Just as in the United States and elsewhere the fossil fuel energy
industry has pushed back in force, and the [22]tos and fros of
politics manifest themselves in policy swings. The "Red-Green"
coalition that governed Germany from 1998-2005 was far more aggressive
in supporting renewable energy than the current government headed by
Angela Merkel. But the bottom line is this: Germany started earlier
and was more consistent in its support of renewable energy development
than just about any other country in the world -- with the possible
exception of Japan. It is now reaping multiple benefits: less
dependence on fossil fuels, reductions in greenhouse gas emissions,
and an increase in quality jobs. Around 130,000 new jobs have been
created in the renewable energy sector overall, with some 30,000 of
those concentrated in solar. And that is far from a static number --
job growth has accelerated dramatically in the last three years.
Signet Solar's business plan demonstrates that Germany's strategy has
already begun to attract foreign investment. But just imagine that
grid parity finally does arrive, and the mighty global energy industry
turns its full attention to solar. The sun will be shining brightly in
northern Europe.
-- Andrew Leonard
References
14.
http://venturebeat.com/2007/05/14/signet-solar-enters-crowded-solar-field/
15. http://www.signetsolar.com/pdf/India_Press_Release.pdf
16.
http://indicview.blogspot.com/2007/06/signet-solar-big-plans-in-indian-pv.html
17.
http://www.navigantconsulting.com/A559B1/navigantnew.nsf/vGNCNTByDocKey/PPD8DB6A453629/$FILE/PreReleaseSO200707-1vs4.0.pdf
18.
http://money.cnn.com/magazines/fortune/fortune_archive/2007/05/28/100049624/index.htm
19.
http://www.antara.co.id/en/arc/2007/6/18/signet-solar-chooses-saxony-for-new-facility/
20.
http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2006/08/18/BUGU0KDCCV350.DTL&hw=abate+applied+materials+solar&sn=001&sc=1000
21. http://www.globalchange.umd.edu/energytrends/germany/1/
22.
http://www.wind-works.org/FeedLaws/Germany/Three%20decades%20of%20renewable%20electricity%20policy%20in%20Germany.doc
23. http://www.salon.com/tech/htww/2007/06/28/german_solar/print.html
--
((Udhay Shankar N)) ((udhay @ pobox.com)) ((www.digeratus.com))
