Wednesday, April 20, 2011

US Government loan programs vs. Chinese loan programs


The example of Yingli Solar shows the difference in scale comparing US support for the solar industry with the Chinese support for their industry.

Yingli Solar has received an initial eight-year government loan of US$70 million from the China Development Bank for their expansion plans in 2008. An additional  US$5.3 billion (!) loan for production expansion was granted in 2010 according to Bloomberg New Energy Finance.

Given that in 2010 Yingli already had a 27% market share in California, the biggest market in the US compared to a 16% market share of all American producers combined it shows that loan funding does lead to a direct market advantage.

On the US side of Solar funding the federal DOE is already proud when they announce a US$117 million support for various Solar Tech companies through the recovery act. The overall amount of government loans handed to the Solar industry in Oregon from the SELP program in the report period 2009-2010 was... US$0. No funds! With more than half of the solar wafering of the US being done in Oregon, the most voluminous and powerful loan tool the Oregon government holds in their hands did not spend a single dollar for the fastest growing industry in the state.

Worse than that, we're discussing to sunset the Energy Tax Credits and don't get out of trial stages on the feed-in tariffs that would at least kick-start the market. A discussion about local content requirements for solar installations that end up receiving FITs, tax credits or government loans is currently not even getting started.

We need to get a public discussion going that really addresses the mechanisms that attract solar manufacturers to our state if we want to stop loosing market share to East Asian competitors.


picture property of wisdomdigest.org