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US Renewable Energy Firms Cash In

By Brandon Thurner
Washington (UPI) Jan 05, 2006
With European nations struggling to keep their promised targets under the Kyoto Protocol for greenhouse gas emissions, U.S. firms are set to cash in on the increased attention on renewable energies.

"All of the countries of the European Union are beginning to feel these broad environmental pressures," said Mark Farber, vice president of strategic planning for Evergreen Solar Inc. "Kyoto is an important piece of this puzzle."

Evergreen, a Marlboro, Mass., firm, specializes in the manufacturing of photovoltaic modules, which are used in the production of solar panels.

Moving into the European market in 2001, Farber anticipates doubling Evergreen's 2005 sales total with a projected sales count of 200,000 units in 2006. A typical solar panel system for a homeowner costs approximately $20,000, while commercial systems may cost up to and more than $2 million. Farber attributes brisk EU sales to several factors.

Strongest sales come from nations that subsidize to firms and consumers who buy renewable technologies. Germany, the world's leading market for solar energy, used a government buyback program for renewable energy that spurred 150 percent growth in the installation of solar panels in 2004 alone. Firms such as Evergreen hope to take advantage of such subsidies with continued aggressive expansion into EU markets.

Two-thirds of Evergreen's sales come from EU clients, said Farber. In 2005, these overseas sales resulted in more than $25 million for the firm. This led Evergreen to expand into Spain, Portugal and Italy in 2005 and Farber's forecasts continue to be optimistic.

"Most of the European countries take Kyoto seriously," said Farber. "Europeans take their environmental stewardship more seriously than those in the United States."

Chief Executive Jon Slangerup of Solar Integrated Technologies Inc., another photovoltaic firm based in Los Angeles, agrees with Farber's views on the expanding European market.

"It's a no-brainer to do business in solar in Europe," said Slangerup in an interview with The Los Angeles Times. "The only question is: How much can you allocate and how fast can you install it?"

Subsidies by European governments often outweigh the increased production costs of renewable energy sources. Solar Integrated produces a photovoltaic cell-based commercial roofing material whose method of production costs more to produce than a kilowatt of electricity, but government funding balances out the added generation costs.

Rhone Resch, executive director of the D.C.-based Solar Energy Industries Association, believes solar energy to be the next high-tech growth industry.

"Renewables have proven they are the source of energy going forward," said Resch. The sheer number of jobs created through renewables, the zero greenhouse gas emissions level and no water being needed to produce them all make renewable energy the source to beat in the future, he added.

Quantifying the economic benefits of developing renewable energy sources, Resch estimates solar energy generates 32 jobs per megawatt while wind produces approximately six to nine jobs per megawatt and natural gas or coal only two to two-and-a-half jobs per megawatt according to estimates by the Lawrence Berkeley National Laboratory and the Renewable Energy Policy Project.

Other benefits of solar power, according to Resch, are its time of production and the fact that solar panels last for 30 years. Typical hours range from 8 a.m. to 6 p.m. each day. These times fall squarely within the peak hours of electricity demand, which exponentially decreases the costs to consumers.

Combining the tangible economic figures with the overall purpose and need to transition to renewable energy sources remains the top priority for advocates.

The Kyoto Protocol is only a first step, said George Sterzinger, executive director of the Renewable Energy Policy Project in Washington. Kyoto's primary purpose is to broadcast what should be done to realize emissions target goals while the real job remaining is to explain the problem of climate change in simple terms.

Key to emphasizing the environmental and economic benefits of renewable energy is getting the United States on board. Installing 18,500 megawatts of renewable technologies in the United States would stabilize carbon emissions and help the nation meet its "global responsibility" in greenhouse reductions, said Sterzinger.

The trickle-down economic effects of transforming energy use from fossil fuels to renewable sources are clear, Sterzinger added. There are approximately 70,000 manufacturing firms across the United States that have the capability to produce the solar components necessary for full panel systems.

Many of these factories are located near cities such as Cleveland or Pittsburgh, said Sterzinger, which have seen a downsizing of the manufacturing base over the last few decades. This gives renewable energy manufacturers the skilled labor pools they need to produce the solar panels while also reviving regional economies.

To spur production, Sterzinger advocates an approach used in the automobile industry, which provided tax incentives to manufacturers who provide parts to the production of an advanced car. With renewable energy, tax incentives should be applied to those manufacturers who provide advancements in technology.

Summing up the real economic benefits to developing renewable energy sources and the expected growth of the field is instinctive for Resch.

"You don't drill for it. You don't mine it. You manufacture it."

These may be just the words old manufacturing towns across the heart of America have been waiting to hear for years.

Source: United Press International

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