What a Georgia-based solar technology company can tell us about what's right and wrong with U.S. innovation and energy policy
The White House hopes green energy can power the 21st century, from research jobs for the lab coats to bolt-screwing jobs for the blue collars. But the United States' buffet of clean tech subsidies pales in comparison to China, and green companies know it. That's why some manufacturing companies, like Evergreen in Massachusetts, have packed up and moved to China, where work is cheaper and subsidies are sweeter.
Suniva is a different story. A leading manufacturer of high-efficiency solar cells, the Georgia-based company is an export powerhouse, winning a 2010 award from the U.S Export-Import Bank for its $2 million deal with India. The company more than doubled in size to 170 employees in 2010. "We're not going to leave here," says J. Bryan Ashley, Chief Marketing Officer at Suniva. "This is our home."
To understand why the company still builds on U.S. soil, you have to understand how it was born. Suniva's story began in the 1980s, when the Department of Energy asked Professor Ajeet Rohatgi to start a solar energy research program at Georgia Tech. The government-backed lab proved to be a nationwide-leader in patents and solutions for solar energy companies (including Evergreen). It eventually gave birth to Suniva, which took exclusive ownership of the patents developed at Georgia Tech. Rohatgi's lab continues to supply the company with a steady stream of government-backed research to help it sharpen its edge.
Suniva has the same reasons to flee the U.S. as Evergreen, like higher labor costs at home and unpredictable subsidies (the manufacturing credit for solar was not renewed this year, Ashley said). But it benefits from an intimate relationship with a research university center supported by the Department of Energy. Not every company is so lucky.
"A lot of the work [the center] has done for other companies left our shores from a manufacturing perspective," Ashley acknowledges. "[The U.S.] is great at research and innovation, but we seriously lack the policies in financing to help scale a new industry very quickly."
Suniva exports 80 percent of its production. The White House or Ex-Im Bank would hold this up as thrilling evidence of a globally competitive company. Ashley would add that it also shows a depressing lack of U.S. demand for solar.
"More people would manufacture [solar products] here if demand was here," Ashley says. "We need a renewable energy standard to create a market in the United States. If demand is overseas, then I'll move factories to other parts of the world. That's just good business."
There's more the government can do. First, Ashley asked for an extended manufacturing tax credit for solar ("People talk about support for solar being crony capitalism but 10-times more money goes into fossil fuels"). Second, he called for a national "green bank" to provide quick financing for new companies' proven breakthroughs in clean tech. "We don't have the policies or incentives to help manufacturers scale up," he says. "That's why we've lost manufacturing to the rest of the world." Third, he asked for corporate tax reform to encourage established firms to do business at home.
Suniva is a beacon and a warning sign. The company's rapid growth demonstrates that the U.S. can compete in green technology. But not every company can bank on a DOE-funded university research incubator that churns out patents. If this is what it takes to be competitive in solar, then the U.S. government either has to get really serious really fast about ramping up its attention to green energy, or else we need to accept that other countries are going to continue to lead in building the foundation for the clean tech revolution, if and when it comes.