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The Energy Race: Will federal budget woes affect progress?
Thin film solar panels produced by General Electric’s PrimeStar in Arvada, Colo. Credit: Edelman; NREL.
Secretary of Energy, Steven Chu, was in Colorado last week, and after months of reeling from the Solyndra debacle, was able to bask in the glow of successful DOE investments. Chu also used the trip to hammer home his messages of innovation and US manufacturing.
Chu’s first stop was at GE’s PrimeStar Solar plant in Arvada, Colo. PrimeStar is building a large manufacturing plant in Aurora, Colo. that will make enough solar modules to power 80,000 homes, according to an NREL press release. GE is investing $600 million in the plant, which makes good on its promise earlier this year to generate 400 jobs.
The press release says PrimeStar’s cadmium-telluride solar panel technology leverages a $3 million investment by DOE “so the experts at NREL’s solar incubator program could help PrimeStar develop the technology to pilot scale.” Who could argue with a $3 million to $600 million conversion?
At PrimeStar Chu built on his theme of innovation,
“Global business in renewable energy last year was $240 billion,” Chu noted. “It’s destined to grow by leaps and bounds. By 2030 it should be $460 billion a year.
“That’s $5 trillion to $7 trillion—a huge market potential.
“It’s very important that we stay in this game,” Chu said. “Is it a game we can win? Absolutely.
“Because of our technological edge, we can be competitive with anyone in the world” if research and development is funded adequately.
And, what is adequate funding of research and development? It’s starting to sound like apple pie—all agree on its value, but there is plenty of squabbling over the recipe.
In the Nov 18 issue of Science Bill Gates has an editorial piece called “The Energy Research Imperative.” He says “The United States is uniquely positioned to lead in energy innovation, with great universities and national laboratories and an abundance of entrepreneurial talent. But the government must lend a hand.” He says that “government investment in energy innovation has dropped by more than 75 percent” in the last 30 years.
The American Energy Innovation Council, a small group of business leaders that includes Gates, has called for the federal government to increase its funding of energy R&D from $5 billion to $16 billion per year.
That’s not going to happen. Yesterday’s failure of the congressional “supercommittee,” which was tasked with finding $1.2 trillion in deficit reductions effectively guarantees no meaningful increases in federal R&D budgets. Now, the law automatically requires that all discretionary spending remain static for the next two budget years and calls for cutting $917 billion over the next ten years, which could mean cuts to R&D budgets in the range of 7-11 percent.
Instead of increasing, energy investment, at least in the SOFC sector, will decrease again when DOE pulls the plug on SECA funding, as we reported last week.
Where that leaves us is unclear. The consistent message out of the funding agencies for the last several months has been innovation to create jobs. In Colorado, while at NREL, Chu said “We haven’t lost our stature in terms of our ability to invent and innovate. But when I see what other countries are doing in terms of support … we have to remember: ‘Are we in this to win?’”
Chu says there is a $5-7 trillion market potential for renewable energy. That’s a mighty big pie. It may be that private investors and industry will have to be more proactive than they’ve been and not let federal funds decide what the winning technologies are going to be. GE’s $600 million investment is encouraging, as are other indicators, like 1366 Technologies‘ ability to raise private capital. Chu is hoping to convince Congress to continue to fund energy research, which he should. That’s his job. I’d like to see Bill Gates take the message to his corporate peers to invest more aggressively, rather than pound the feds for more money.
There are two important meetings in February 2012 that will be of interest to the segment of our community engaged in energy research, and unfortunately, they overlap.
The Materials and Challenges in Alternative and Renewable Energy 2012 (Feb 26-March 1, Clearwater, Fla.) is a technical meeting cosponsored by ACerS, ASM, TMS and SPE. This will be the meeting to attend for those responsible for “doing” innovation and engineering new energy technologies into realities. The technical program includes symposia specific to a wide range of new energy technologies, such as wind, solar, batteries, nuclear and much more.
ARPA-E’s 2012 Energy Innovation Summit (Feb. 27-29, Washington, DC) seems to be geared more toward strategists and business development types. Keynote speakers include a cadre of big names from large, successful businesses like Gates, Ursula Burns from Xerox, Fred Smith from FedEx and Lee Scott of Walmart, who will, according to an earlier press release, “share ideas for developing and deploying the next generation of clean energy technologies.” There will also be a showcase highlighting recent winners of ARPA-E funded projects.
Are we in this to win? I hope so.
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Ceramics and glass business news of the week
Here’s what we are hearing:
Miele to release solar-heated clothes dryer
Tosoh establishes a thin film sputtering target manufacturing subsidiary in Shanghai
Lucifer Furnaces builds fiber-lined oven for Lincoln Electric
Oxford Instruments enters the FTSE 250 financial index
Rotex Ultrasonex system improves mesh deblinding, increases sieving capacities up to 10 times
NEG delivers ultra-thin lightweight mirrors for JAXA’s space solar power systems (pdf)
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Solar silicon manufacturing innovators get big boosts with new DOE loan guarantees
Calisolar silicon is purified in a unique, liquid-phase process producing solar silicon without the high energy and specialized equipment of conventional vapor-phase silicon purification. Credit: Calisolar.
As I have written several times before, the costs tied to the processing and manufacturing of photovoltaic units are dropping, but they are still the main impediment to PV being price competitive with coal-generated power. Thus, it is wise for the DOE to leverage some of its financial power to help 1366 Technologies Inc. and Calisolar Inc., two companies focused on slimming down a major part of the PV value chain: making the silicon that forms the crucial performance foundation of PV units. On Thursday, the agency announced a $275 million loan guarantee for Calisolar and Friday it announced a similar deal for 1366 for $150 million.
Keep in mind that these are loan guarantees, not direct grants. Both companies have received funding from parts of DOE in the past, but these loan guarantees are extremely important to the enterprises’ business models by lowering the cost of capital investments (with DOE assuming nearly all of the financial risk).
1366’s direct wafer technology, in a nutshell, eliminates the waste that occurs in slicing expensive silicon ingots into wafers and, in doing so, also eliminates several steps in the traditional wafer production process. 1366/MIT guru Emanuel Sachs is well known for postulating that “manufacturing innovations in silicon PV will decrease costs by 10% per year through 2020, at which point solar electricity becomes cheaper than coal” (Sachs’ Law). 1366 has also developed novel approaches to other PV production steps and performance enhancers, such as busbar improvements.
The DOE predicts that with its next round of funding, 1366 will be capable of producing approximately 700 to 1,000 megawatts worth of wafers annually and reduce wafer costs by about 50 percent. The company has a two-phase plane, with the first and smaller phase involving construction of a facility in Lexington, Mass. DOE says that plant will yield 70 permanent jobs. The second phase “will create hundreds of additional jobs.”
The Calisolar deal is supposed to be a bigger deal, at least, as far as job-creation goes, with 1,100 permanet jobs planned for a converted auto parts stamping plant near Mansfield, Ohio, that, as a story in the Columbus Dispatch notes, has been desperate for new manufacturers since GM departed.
Calisolar, including a company it has acquired, 6N Silicon, has been on DOE’s radar for several years. 6N was begun by Scott Nichol and is rooted in work done at Cananda’s McMaster University where he developed a method to reduce silicon costs by perfecting a relatively inexpensive way to purify cheap, low-grade silicon. As the story goes, the 6N name refers to “six nines” or 99.9999 percent purity.
Calisolar, meanwhile, had been developing low costs methods related to the conversion of solar silicon to production wafer, including crystallization, wafering and cell processing. The company was launched in 2006 by veteran materials engineers Kamel Ounadjela, Fritz Kirstch and Eicke Weber.
When Calisolar and 6N joined forces in 2010, it gave the company a way to control and vertically integrate four key productions steps. It’s not clear what total value chain savings they can generate, but they claim silicon costs are reduced 50 percent, and the company’s capital and construction investments are only one-sixth that of a traditional polysilicon cell maker.
According to DOE, “the manufacturing plant is expected to produce 16,000 metric tons of solar silicon annually, equivalent to more than two gigawatts of solar power generation per year. The project will be built in three phases of 5,333 MT capacity each.”
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1366 continues to draw interest of investors, DOE
Ann’s earlier post regarding the accelerating drop in costs in 2009 and 2010 for installed photovoltaic solar energy systems general jibes with the estimates by Emanual Sachs, of 1366 Technologies/MIT. Sachs predicts that “manufacturing innovations in silicon PV will decrease costs by 10% per year through 2020, at which point solar electricity becomes cheaper than coal” (Sachs’ Law).
1366 received a $4 million ARPA-E grant last December and the company recently announced that it had raised another $20 million from investors. It also recently hosted DOE Secretary Chu at its facilities in Massachusetts:
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DOE video: Why ARPA-E funded 1366’s direct wafer technology for photovoltaic units
I continue to be really impressed with 1366 Technologies’ technical work and and business strategy. Now DOE has put together a short (4 minutes) video about 1366’s Direct Wafer Technology silicon wafer production system and why ARPA-E has provided the company with $4 million to continue their efforts. There isn’t a lot of depth here, but it is a nice, easy-to-understand promo piece for both 1366 and DOE/ARPA-E.
For more on 1366, see
1366 Technologies demonstrates directly manufactured silicon PV wafer
Part 1: New busbars, ‘fingers’ to cut costs by 20%
Part 2: Process improvements versus science breakthroughs
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