Anyone who has spent time in Silicon Valley knows that for every Google or Apple, there are scores of companies whose names fade into oblivion. Creating transformative technology is no easy task, and success always has failure in its wake. Indeed, venture capital firms expect just one in ten of the companies they invest in to prosper.
Solyndra is one of those companies that didn’t make the cut. It was trying to create cheaper solar technology, but couldn’t achieve that vision and ultimately lost out in the very competitive solar marketplace.
Solyndra accepted taxpayers’ money, and if there was wrongdoing involved, those responsible must be held to account.
But some lawmakers haven’t stopped there. They have seized on Solyndra’s demise as an opportunity to thwart both the Department of Energy’s loan program and the entire renewable energy sector.
The truth is Solyndra was just 1 of 40 recipients of Department of Energy loan guarantees. It represents only 2.9 percent of the DOE’s renewable energy loan portfolio. And as the New York Times recently reported, plenty of GOP leaders who are now complaining about Solyndra and the clean energy loan program have in the past lobbied hard to secure federal money for clean energy projects in their own districts.
I understand why these lawmakers would want to support clean energy in the communities they represent: it’s one of the fastest growing sectors in the economy. But when they turn around and bash those same programs that benefit them, you know it is politically motivated.
And while they may find fault in the government’s lack of due diligence on Solyndra, the Department of Energy wasn’t the only one who made a bad bet on the company. Just 18 months ago, the Wall Street Journal ranked the company as number 5 in its list of Top 50 Venture-Backed Companies. The company’s private investors included KKR, Argonaut, CMWA, Masdar, Redpoint, and RockPort. Yet their inability to catch the warning signs hasn’t inspired lawmakers’ cries to reexamine private investment and shut down venture capital firms.
Meanwhile, the other 119 PV solar companies in America are thriving and the sector as a whole is booming:
- Solar capacity has had annual growth rates topping 45 percent every single year since 2005.
- Last year it doubled and for the first half of 2011, has grown 72 percent compared to the previous year, according to the Solar Energy Industries Association.
- The price of a solar array has fallen by 42 percent since December, 2010, driven by a combination of market forces and government incentives.
- More than 100,000 Americans now work in the solar power and solar heating industry, according to 2011 Solar Jobs Census.
PV innovators are just one part of a much larger solar value chain, a chain that many U.S. companies are dominating. American companies lead the way in selling silicon, machining, tooling, creating components like inverters, and installing solar systems. The Solar Energy Industries Association (SEIA) recently published a report showing that the U.S. is a net exporter of solar energy products across the entire value chain, adding $1.9 billion in value to the U.S. economy last year. This also includes a trade surplus in China.
As my colleague Nathanael Greene points out, the best way for America to maintain a place at the forefront of the clean energy market is not to compete on turf already dominated by other nations. Instead, we should leverage what America does best: innovate new technologies and build new companies.
That will require taking risks and inviting failure. But America industry didn’t grow strong by playing it safe. From Edison on down, our inventors have all made bold choices. After he invented the Model T, William Ford famously said, “If I had asked my customers what they wanted they would have said a faster horse.”
Misconduct and the unlawful use of taxpayers’ money are unacceptable. But attacking clean energy programs is attacking one of the greatest engines of economic growth in our economy right now and undermining American jobs when we need them the most.