The New York Times posted yet another error-riddled article last Friday on clean energy. This one, titled “A Gold Rush of Subsidies in Clean Energy Search,” purports to describe the “banquet” of “lucrative” subsidies that result in “windfalls” to renewable energy project investors.

Rather than catalog all the errors made by the Times, I will just point readers on to some very thorough rebuttals already online from NRG and others. What’s amazing is that almost nothing in the article stands up to scrutiny. It reveals an astounding failure of the paper’s editors and gives the impression the story was rushed to press to make a splash.

But the biggest thing the article got wrong is the presumption that there is something wrong or shameful going on when an energy company realizes a profit investing in a solar project. Forgive me, but isn’t the whole point of current solar incentives to get the industry over the final hurdles to scale and credibility so that it can play a role in mainstream energy markets?

The whole point of subsidies for promising new technologies is to make them economically competitive with entrenched incumbents–like coal, natural gas, and nuclear. Those incumbants receive billions in subsidies today despite the fact they enrich some of the world’s most profitable companies. On this unequal playing field, transitioning to clean, solar energy surely deserves government support.

Why does solar make sense to subsidize? Because it’s a rapidly maturing technology and we have a virtually endless supply of both silicon and sunlight. Today, solar costs 70% less than it did just 2-3 years ago and those costs will only continue to decline as the industry grows and innovates. As a society, we frequently make choices about how we want our country and its infrastructure to look in the future. In the case of solar, it’s a clear and easy choice to make.

The very facts the authors cite as evidence of solar policy failure are actually the evidence of a compelling policy success. The combination of state renewable mandates and federal subsidies finally add up to a formula that provides companies like NRG with enough profit incentive to invest in a big way. In other words, we finally seem to be getting the policy formula right! Was someone over at the New YorkTimes under the impression that NRG, Duke, FPL, and others were investing in solar without expecting a return?

The New York Times’ editors underestimate the intelligence of the American people who have repeatedly affirmed their support for renewable incentives (Pew Study & UT Austin Study)because they are important and necessary. They further insult Californians by insinuating the state’s Renewable Portfolio Standard (RPS) is a handout when Californians have repeatedly demonstrated they understand and support greenhouse gas goals. They even ignore America’s small business owners–the ones supposedly hurt by ‘over regulation’–who overwhelmingly support programs to reduce carbon emissions because it creates new market opportunities.

Here’s what I’m excited about. Solar power, once viewed with extreme skepticism by utilities, is now embraced my mainstream companies like NRG to the tune of hundreds of millions of dollars. We would do well to hope other government initiatives could meet with such success!

I’ve been getting up to speed on the trade proceeding initiated by SolarWorld that seeks to impose punitive duties on US companies that import Chinese solar modules. What I’ve learned is chilling. The nightmare that is likely to unfold will have severe and immediate consequences to the US solar industry. Unless the industry takes action now, the result will be massive loss of jobs, decimation of the US solar project pipeline, and the failure of numerous US solar businesses.

To see why the impact will be so severe, it’s important to understand two things: how the trade proceeding works and how US utility scale solar projects get developed.

A Quick Summary of the Trade Process

The trade process will move forward via a series of hearings culminating in a final decision on whether to impose duties at the end of September 2012. However, the intermediate hearings present big risks because of how the process works and when liabilities for duties attach to importers.

The first hearing is next week to gather initial testimony. The first decision about whether there is sufficient evidence to move forward with an investigation will occur December 5. If they decide to move forward (which is very likely because the level of proof required at this stage is very low) the next decision comes in spring 2012. This is when a preliminary decision is due on the amount of duties to be imposed on US importers.

The preliminary decision date is critical because from this date forward importers must post cash or bond to cover the duty on all subsequent imports. What’s worse, duties can be imposed retroactively going back 90 days to cover imports from December 2011 on. In other words, the risk of duties being imposed will impact decision making almost immediately even though the final decision isn’t due until September of next year.

Another very important point to clarify, import duties are imposed on importers, not exporters. In other words, it is the US solar businesses that are importing modules from China that will be hit with the duties–not the exporters. Furthermore, if an exporter were to reimburse or compensate an importer in any way, the duty is automatically doubled to ensure punitive impact on those involved.

An Industry at Risk: A $40B Pipeline and Tens of Thousands of Jobs

The US solar market has been growing leaps and bounds in recent years. In large part, that’s because utilities have been eager to sign large contracts with developers for new solar generating plants. Most of those plants are going into construction or about to go into construction. An import duty will render most of those projects worthless by doubling the cost of the equipment going into building them. The result will be a wave of delayed and terminated projects, which will spill over into tens of thousands of lost jobs and an equally bleak landscape of bankrupt developers.

To get a sense for the magnitude of this impact all you have to do is look at the volume of projects that are in the late stages of development. Using publicly available data, Greentech Media estimates the US utility solar pipeline at 21 gigawatts (worth roughly $80B when completed). About 9.7GW (roughly $40B) already have contracts in place with utilities and are either in construction or about to go into construction. This pipeline represents nothing less than the future of US solar growth, investment and jobs. 

Source: Greentech Media

I can’t say exactly what portion of these projects are relying on Chinese made solar panels, but I think it’s a safe assumption that it’s easily more than half. That’s because, like it or not, the vast majority of panel manufacturing capacity is now in China. What this means is that something on the order of $20B-$30B of contracted utilty solar projects and all they represent are at risk. 

For the US economy, this couldn’t come at a worse time. The US solar industry is one of the few bright spots when it comes to jobs. The industry now employs over 100,000 Americans (mostly in engineering and building projects) and is forecast to add upwards of 10,000 new jobs next year. 

The shameful irony in all of this is that SolarWorld (a German company with a manufacturing facility in Oregon) has wrapped itself in the US flag while initiating a process that could bring the US industry to its knees. The couple of hundred US manufacturing jobs they claim to be “saving” are insignificant compared to the thousands of US companies and jobs their actions will destroy. 

The rest of the industry needs to wake up fast to this reality and do whatever it takes to stop the trade proceeding as soon as possible. As someone who’s worked for the past 10 years to make US solar a reality, the consequence of failure is almost too terrible to contemplate.