The solar industry took another blow last week. Evergreen Solar stocks were downgraded by major investment firms, and subsequently fell further to less than $1.50 per share. Evergreen’s fall may be having the most direct effect in its home state of Massachusetts, but this decline is representative of a wider fall in solar stock prices, leading to both cutbacks in solar jobs and lower panel prices.
For Evergreen Solar, a bastion of solar industry success in Massachusetts, the twin problems of lower prices and oversupply influenced a recent decision to shift assembly of its solar panels to China, where the company says it can produce for $1.50 per watt. It is as yet unclear how many jobs in Massachusetts will be lost, although of the 577 or so current full-time employees, over half are involved in manufacturing.
Oversupply and weakened demand have forced a scaling-down of U.S. operations by several solar industry players. In terms of manufacturing, China continues to gain momentum due to lower labor costs and less barriers to implementation. In terms of innovation, the United States continues to compete, even lead. But it nevertheless remains cheaper to manufacture overseas and have products shipped back to the States than to simply make them closer to the point of use.
Upsides to falling solar stocks and oversupply lies in the hands of homeowners, who are now enjoying the most lucrative financial incentives in history, coupled with the lowest solar equipment costs to date. Granted, a serious lack of money in the average American home is itself a source of home solar industry troubles. Even homeowners with the resources to at least garner a loan to cover up-front solar costs are leery of taking on more debt in uncertain times.
The truth is that solar power is still a young and volatile industry, one that ran smack dab into the worst housing and economic crisis since the Great Depression. Yet even in the face of that dire assessment, long-term outlook remains optimistic because the solar industry has more than just long-term potential - it has endless potential.
Falling stock prices and industry cutbacks are leaving homeowners unemployed and facilitating the shipping of jobs (rather than solar panels) overseas. And while we can easily remain positive about long-term projections for the U.S. solar market, the real challenge for the federal government, states, industry leaders, labor advocates and even homeowners is how to ensure success for the “triple bottom line” touted by so many green business enthusiasts: that industry, society and environment will prosper together in the new solar-led sustainable paradigm.
Photo Credit: MediaBistro