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President Barack Obama has made it clear that investing in renewable energy is central to his plans for economic recovery and securing energy independence. Still, companies around the country have announced that they are not immune to hard times and economic downturn. With sales dropping and projects being scaled back, companies have started to ask for help to reinvigorate the industry.
Analysts have also reported that a gloom is blocking out the industry's bright future. Market capitalization has fallen from $200 billion in 2008 to just over $60 billion today. On top of that, 200 of the 700 major solar energy firms are facing serious financial problems, with another 140 in danger of joining them. Michael Rogol, managing director of PHOTON Consulting, believes that a "thinning of the herd" is beginning.
Fortunately, all of the news is not bad. The economic downturn that is slowing business is also making equipment necessary for building solar and other renewable energy power plants less expensive. This is, at least for now, making the setup costs for these plants much cheaper, allowing companies to consider smaller projects with more limited budgets.
Another aid coming to the industry is the recently passed American Recovery and Reinvestment Act of 2009; the economic stimulus bill that Barack Obama helped push through Congress. Tax credits and direct investment will help solar, wind, and other renewable energy companies weather this period of economic uncertainty.
Despite the world economy and unstable markets, most members of the industry are confident that, thanks to commitments from governments around the world, the future of renewable energy is bright.
For more environmental news and analysis, don't miss Focus Earth: February 28, 2009: Economizing Energy and Green Industry Blues.
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