On April 25, 1954 in Berkeley Heights, New Jersey, technicians at AT&T's legendary Bell Labs publicly demonstrated a solar photovoltaic panel for the first time, capturing light to power the rotation of a miniature Ferris wheel. The New York Times called it "the beginning of a new era, eventually leading to the realization of one of mankind's most cherished dreams."
Well, "eventually" took a while, in no small part because of the estimated cost of that first PV panel: $286 per watt. Which meant that the average homeowner in 1954, if a rooftop solar array were available, could have installed one for a cool $1.43 million. (A 1954 Cadillac Eldorado, for comparison, cost less than $5,000). But without recounting 60 years of challenges and setbacks, let's jump ahead to where solar energy deployment, by almost any measure, is today. It's booming.
Propelled by the 80 percent drop in module prices in the past five years, and even more so by finance innovations like leasing and power-purchase agreements, residential and commercial solar installations are by far the hottest sector in clean-energy generation. Statistical evidence abounds, but here are a few of my favorite facts and figures:
As Clean Edge noted in our recent Clean Energy Trends 2014 report, in 2013 the world installed more new gigawatts of solar PV (36.5 GW) than wind power (35.5 GW) for the first time.
- More Americans (143,000 in 2013) work in the solar industry than the coal industry. In Texas, there are more solar workers than ranchers, and in California, more solar employees than actors.
- Warren Buffett has invested an estimated $7 billion in solar generation facilities.
- More than 60 percent of U.S. homeowners say they're interested in installing solar, and 73 percent say they would welcome clean energy provided by an entity other than their utility, according to the Solar City-Clean Edge poll released in March.
- Earlier this month, First Solar's Agua Caliente plant in Yuma, Arizona became the world's largest PV generation facility with capacity of 290 MW.
- Solar accounted for 28.7 percent of new U.S. generation capacity in 2013, trailing only natural gas (46 percent) among energy sources. "Solar is now sitting at the big kids' table," says GTM Research senior VP of research Shayle Kann.
As is well known, the solar boom in the U.S. (with a few exceptions) is not a manufacturing success story. It's focused on the "downstream" sector of deployment and installation. But this sector has proven to be a rich source of innovation and startup energy in many diverse aspects of the solar value chain. Many of today's best entrepreneurial minds are working to make solar ever more accessible, focusing on new financing options and reducing soft costs like permitting and customer acquisition.
This is on full display at an Oakland, Calif.-based incubator/accelerator with the phonetically challenging name of SfunCube. Founded by Sungevity co-founder Danny Kennedy and Emily Kirsch, a former principal in Van Jones's Green-Collar Jobs Campaign, SfunCube is an acronym for "solar for universal need." SfunCube claims to be the world's only incubator exclusively devoted to solar companies; its first and largest member (you might say anchor tenant) is Mosaic, the solar financing pioneer that has amassed more than $5.5 million in crowdfunding of distributed solar projects.
Last month, I toured the SfunCube office with Kirsch. Overlooking the Oakland Estuary from Jack London Square, the office (currently shared with Sungevity, but shortly moving to Oakland's Uptown neighborhood) has the classic Bay Area startup trappings of open space, beanbag chairs, foosball, and ping-pong. Beyond the bright colors and fun accoutrements, I was struck by the sheer diversity of solar-related activities that these young businesses are targeting. To name just three, Powerhive makes 30- to 100-kW solar arrays, for off-grid use in Kenya, that are monitored and managed by cloud-based software from its offices in Oakland, Amsterdam, and Nairobi. Sunible tracks U.S. solar installations by zip code, taking a page from Opower's book that comparing yourself to neighbors is a powerful motivator; it also lists and ranks solar providers active in your area. Big Data player kWh Analytics provides investors looking to securitize solar projects with real-time performance data of some 10,000 PV installations. Like some other Sfuncube members, kWh Analytics has received a DOE SunShot grant to help advance the industry, and its founder Richard Matsui is on Forbes' 30 Under 30 list of young business leaders.
SfunCube and Sungevity are also at the heart of an effort to make solar (and clean tech/high tech in general) a key driver of economic development and job creation in Oakland, which has traditionally been much more challenged than neighboring San Francisco and Silicon Valley in doing so. As noted in a recent New York Times story, this effort is having some success. It's often compared to the economic resurgence of Brooklyn, New York, home to another emerging clean-tech accelerator, NYC ACRE -- New York City Accelerator for a Clean and Resilient Economy.
The golden age of solar faces many hurdles ahead, of course. The looming expiration of the 30 percent federal investment tax credit (ITC) for solar in 2016 could be a setback, although PV financing options should be even more creative and mainstream by then and the impact may not be as great as some fear. But that's not to say that solar shouldn't continue to receive some federal support as the nation shifts toward climate-friendly energy options.
And as noted in our Clean Energy Trends 2014 report and extensively elsewhere, the growth of distributed solar PV is challenging the decades-old centralized utility model as never before, prompting legislative efforts in many states to roll back net metering or otherwise raise the costs of going solar. Oklahoma (one of the fastest-growing states for wind power, by the way) recently enacted a new law allowing the state's utilities to impose new rates or fees on solar users. Contrary to some alarmist press reports, it's not a "tax on solar," although it does set the stage for potentially onerous fees. The Sooner State's utilities will be closely watched to see how they act in this latest backlash against a booming, disruptive industry that threatens many established interests as it celebrates the 60th birthday of its core product. That's what happens when you sit at the big kids' table.