Big business behind solar power

(Editor's note: This is the fourth in a series of five Underreported Stories of 2011*)

By Josh Sternberg
Current.com contributor 

Energy independence, two words that evoke all sorts of questions: What’s "clean"? What’s safe? What’s cheap? What’s sustainable?

This year, two years after the U.S. Department of Energy loaned $535 million to support solar company Solyndra’s construction of a commercial plant, Solyndra filed for bankruptcy and laid off more than 1,000 employees, sparking a wave of articles about the company and the government’s failed bet on a renewable energy company. Republicans, of course, pounced on the company’s failing as proof-positive that the federal government should not get involved in “pick(ing) winners and losers” through these types of loan guarantees.

While the press was caught up in this typical Washington debate, a different story emerged, one that puts big business on the same side of solar power.

The Christian Science Monitor reported this month that Internet giant Google, and the private equity firm Kohlberg Kravis Roberts & Co. (KKR) are investing $189 million in four California solar farms, aiming “to generate 88 megawatts of electric power, enough for more than 13,000 average American homes.” The article also highlights Google’s commitment to investing in clean energy:

Google's investments in clean energy projects exceed $925 million, including more than $880 million since the beginning of this year. Google said Tuesday that these investments aim to produce 1.7 gigawatts of power and provide electricity to 350,000 houses.

Even oil companies are getting into the solar game. French oil powerhouse Total AG bought SunPower for $1.37 billion. The Wall Street Journal reported in April:

The deal signals growing confidence among conventional energy players that solar power is poised to grow quickly from its current small size. "This is a nice validation proof point. It is certainly not a distressed sale," said Sheeraz Haji, chief executive of Cleantech Group LLC.

The Daily Caller also reported Berkshire Hathaway, run by Warren Buffett, bought Tempe, Ariz., solar company First Solar, for $2 billion. The article reports:

The 550-megawatt Topaz project will qualify for a federal incentive because it began construction last month, and will sell power under a long-term contract that was completed before prices for solar panels fell 44 percent in the last year.

Today’s Energy Solutions magazine reports that even General Electric, one of the nation’s most influential companies, has gotten into the solar game:

However, the most impressive addition to Colorado's portfolio will be the addition of the largest U.S. solar factory. In October, GE officials announced that the city of Aurora will be home to the $300 million solar factory. According to Vic Abate, vice president, renewable energy, GE, building of the factory will be without federal subsidies. Abate states that GE officials chose Aurora because of pre-existing facilities and its proximity to GE's test manufacturing line.

The factory, which will be bigger than 11 football fields, will have an annual capacity of 400MW, enough to supply electricity to approximately 80,000 homes.

Seeking Alpha describes this sudden rush from big companies into the solar sector as a typical evolution:

There are distinct phases in the development of a new technology.

The first phase is the era of the start-ups. The second is the era of big capital. America is now into that second phase.

Spurred by fears that we're losing “the green energy race” big players like Warren Buffett and General Electric (GE) are replacing older, entrepreneurial companies as leaders of America's solar industry.

The fear is that even American production of solar panels may be dominated by foreign companies like Sharp, which is adding workers at its Memphis solar panel factory. The companies are willing to take a short-term hit on earnings in order to make sure America has a shot at the “next big thing.”

And the business community is showing that even smaller players can raise significant money for solar plants. The San Francisco Chronicle reports:

And Stion, a San Jose startup that makes thin-film solar cells, said Tuesday that it has raised another $130 million in private investments, much of it from Korean private equity funds.

Story picked up by:
Christian Science Monitor | The Daily Caller | Seeking Alpha | Today’s Energy Solutions | San Francisco Chronicle | MIT Technology Review | Wall Street Journal

* Five Underreported Stories of 2011: This time of year, media outlets publish their year-in-review articles and lists, looking back on recent history and reflecting on the major events that shaped the past 365 days. In fact, the Pew Research Center’s Project for Excellence in Journalism conducted a study of the year’s top stories and the frequency of each reported story. 

However, for a variety of reasons, there are always some stories that slip through the cracks and don’t get as much attention. This is our list, in no particular order, of five stories that went underreported in 2011. 

Monday's story: Number of homeless children highest in American history
Tuesday's story: U.S. military infiltrates social media
Wednesday's story: Food prices trigger revolution

Josh Sternberg is a freelance writer, former adjunct professor and recovering communications professional based in Brooklyn. He blogs at The Sternberg Effect. Follow him on Twitter and Tumblr.

(Photo: Getty Images)