|Solyndra’s financial woes should not be seen as a death-knell for the solar energy industry.|
Solyndra LLC, the American manufacturer of innovative cylindrical solar systems for commercial rooftops, has announced that global economic and solar industry market conditions have forced the Company to suspend its manufacturing operations. Solyndra intends to file a petition for relief under Chapter 11 of the U.S. Bankruptcy Code while it evaluates options, including a sale of the business and licensing of its advanced CIGS technology and manufacturing expertise. As a result of the suspension of operations approximately 1,100 full-time and temporary employees are being laid off effective immediately.
Despite strong growth in the first half of 2011 and traction in North America with a number of orders for very large commercial rooftops, Solyndra could not achieve full-scale operations rapidly enough to compete in the near term with the resources of larger foreign manufacturers. This competitive challenge was exacerbated by a global oversupply of solar panels and a severe compression of prices that in part resulted from uncertainty in governmental incentive programs in Europe and the decline in credit markets that finance solar systems.
“We are incredibly proud of our employees, and we would like to thank our investors, channel partners, customers and suppliers, for the years of support that allowed us to bring our innovative technology to market. Distributed rooftop solar power makes sense, and our customers clearly recognize the advantages of Solyndra systems,” said Solyndra’s president and CEO, Brian Harrison. “Regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion. Raising incremental capital in this environment was not possible. This was an unexpected outcome and is most unfortunate.”
Should this be seen as a major blow to the solar energy industry? Probably not. True, other manufacturers of solar power equipment are suffering. But given the general weakness of the global economy, that’s hardly surprising. The industry is seeing both gains and losses. This past month for example, SunPower Corp. reported a second-quarter net loss of $147 million. But it also announced a new solar panel manufacturing plant in Mexicali, Mexico, necessary to meet the growing North American demand for solar energy.
Shareholders and investors may lose confidence and even panic. Yet, that doesn’t change the fact that solar is still one of our best options for clean, renewable energy.
Read Photovoltaics System Design and Practice from Amazon.