The Future of
Photovoltaics Manufacturing
in the United States
Summary of Two Symposia
Charles W. Wessner, Rapporteur
Committee on Competing in the 21st Century:
Best Practice in State and Regional Innovation Initiatives
Board on Science, Technology, and Economic Policy
Policy and Global Affairs
NATIONAL RESEARCH COUNCIL
OF THE NATIONAL ACADEMIES
THE NATIONAL ACADEMIES PRESS
Washington, D.C.
THE NATIONAL ACADEMIES PRESS 500 Fifth Street, N.W. Washington, DC 20001
NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance.
This study was supported by: Contract/Grant No. DE-AT01-06NA26358, TO #28, between the Department of Energy and the National Academy of Sciences. This report was prepared by the National Academy of Sciences under award number SB134106Z0011, TO #4, from the Technology Innovation Program of the National Institute of Standards and Technology (NIST), U.S. Department of Commerce. The statements, findings, conclusions, and recommendations are those of the author(s) and do not necessarily reflect the views of NIST or the U.S. Department of Commerce. This report was prepared by the National Academy of Sciences under award number 99-06-07543 from Economic Development Administration, U.S. Department of Commerce. The statements, findings, conclusions, and recommendations are those of the author(s) and do not necessarily reflect the views of the Economic Development Administration or the U.S. Department of Commerce. Additional funding was provided by The Heinz Endowments, Acciona Energy, Dow Corning Corporation, IBM, SkyFuel Inc., and the Association of University Research Parks. Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the views of the organizations or agencies that provided support for the project.
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THE NATIONAL ACADEMIES
Advisers to the Nation on Science, Engineering, and Medicine
The National Academy of Sciences is a private, nonprofit, self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the furtherance of science and technology and to their use for the general welfare. Upon the authority of the charter granted to it by the Congress in 1863, the Academy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Ralph J. Cicerone is president of the National Academy of Sciences.
The National Academy of Engineering was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages education and research, and recognizes the superior achievements of engineers. Dr. Charles M. Vest is president of the National Academy of Engineering.
The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters pertaining to the health of the public. The Institute acts under the responsibility given to the National Academy of Sciences by its congressional charter to be an adviser to the federal government and, upon its own initiative, to identify issues of medical care, research, and education. Dr. Harvey V. Fineberg is president of the Institute of Medicine.
The National Research Council was organized by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academyâs purposes of furthering knowledge and advising the federal government. Functioning in accordance with general policies determined by the Academy, the Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the government, the public, and the scientific and engineering communities. The Council is administered jointly by both Academies and the Institute of Medicine. Dr. Ralph J. Cicerone and Dr. Charles M. Vest are chair and vice chair, respectively, of the National Research Council.
Committee on
Competing in the 21st Century:
Best Practice in State and Regional Innovation Initiatives*
Mary L. Good, Chair
Donaghey University Professor
Dean, Donaghey College of Engineering and Information Technology
University of Arkansas at Little Rock and STEP Board
Richard A. Bendis
Founding President and CEO
Innovation America
Susan Hackwood
Executive Director
California Council on Science and Technology
William C. Harris
President and CEO
Science Foundation Arizona
W. Clark McFadden II
Partner
Dewey & LeBoeuf, LLP
Michael G. Borrus, Vice Chair
Founding General Partner
X/Seed Capital Management
Mary Maxon
Initiative Lead
Marine Microbiology Initiative
Gordon and Betty Moore Foundation
David T. Morgenthaler
Founding Partner
Morgenthaler Ventures
Edward E. Penhoet
Director
Alta Partners
Tyrone C. Taylor
President
Capitol Advisors on Technology
____________________
*As of July 2009.
PROJECT STAFF*
Charles W. Wessner
Study Director
Alan Anderson
Consultant
McAlister Clabaugh
Program Officer
David S. Dawson
Senior Program Assistant
Sujai J. Shivakumar
Senior Program Officer
David E. Dierksheide
Program Officer
Adam H. Gertz
Program Associate
(through June 2010)
____________________
*As of May 2011.
For the National Research Council (NRC), this project was overseen by the Board on Science, Technology and Economic Policy (STEP), a standing board of the NRC established by the National Academies of Sciences and Engineering and the Institute of Medicine in 1991. The mandate of the STEP Board is to integrate understanding of scientific, technological, and economic elements in the formulation of national policies to promote the economic well-being of the United States. A distinctive characteristic of STEPâs approach is its frequent interactions with public and private-sector decision makers. STEP bridges the disciplines of business management, engineering, economics, and the social sciences to bring diverse expertise to bear on pressing public policy questions. The members of the STEP Board* and the NRC staff are listed below:
Edward E. Penhoet, Chair
Director
Alta Partners
Lewis W. Coleman
President & CFO
DreamWorks Animation
Alan M. Garber
Henry J. Kaiser, Jr. Professor
Professor of Medicine
Director, Center for Primary Care and Outcomes Research
Stanford University
Ralph E. Gomory
Research Professor
Stern School of Business
New York University
and
President Emeritus
Alfred P. Sloan Foundation
Mary L. Good
Donaghey University Professor
Dean, Donaghey College of Engineering and Information Technology
University of Arkansas at Little Rock
Amory Houghton, Jr.
Former Member of Congress
David T. Morgenthaler
Founding Partner
Morgenthaler Ventures
Joseph P. Newhouse
John D. MacArthur Professor of Health Policy and Management
Harvard Medical School
Arati Prabhakar
General Partner
U.S. Venture Partners
William J. Raduchel
Chairman
Opera Software ASA
Jack W. Schuler
Partner
Crabtree Partners
Alan Wm. Wolff
Of Counsel
Dewey & LeBoeuf LLP
____________________
*As of May 2011.
STEP STAFF*
Stephen A. Merrill
Executive Director
Paul Beaton
Program Officer
McAlister Clabaugh
Program Officer
David S. Dawson
Senior Program Assistant
David E. Dierksheide
Program Officer
Charles W. Wessner
Program Director
Adam H. Gertz
Program Associate
(through June 2010)
Daniel Mullins
Program Associate
Sujai J. Shivakumar
Senior Program Officer
____________________
*As of May 2011.
Contents
A. Addressing the Renewable Energy Challenge
B. Regaining U.S. Leadership in Renewable Energy
C. Challenges for PV Manufacturing
D. Accelerating Innovation Through Collaborative Research
E. What Is the Role for Government?
Charles Wessner, The National Academies
Clark McFadden, Dewey & LeBoeuf LLP
John Lushetsky, U.S. Department of Energy
Panel I: Opportunities and Challenges Facing PV Manufacturing in the United States
Moderator: Kevin Hurst, Office of Science and Technology Policy, Executive Office of the President
Michael J. Ahearn, First Solar
Dick Swanson, SunPower
Unleashing the Power of the Sun
Eric Peeters, Dow Corning Solar Solutions
Moderator: Pete Engardio, BusinessWeek
PV Manufacturing in the United States
Eric Daniels, BP Solar
Applied Materialsâ Perspective
Mark Pinto, Applied Materials
DuPont Reflections on Photovoltaics
Steven C. Freilich, E. I. du Pont de Nemours and Co.
Panel III: National and International Consortia: Lessons and Best Practices
Moderator: Clark McFadden, Dewey & LeBoeuf LLP
Collaboration for Success in Semiconductors
John E. Kelly, IBM
Johan Van Helleputte, IMEC
Public-Private R&D Collaboration: Lessons from PV Partnerships
Robert M. Margolis, National Renewable Energy Laboratory
Panel IV: Economics of Photovoltaics in the United States
Moderator: Richard Bendis, Innovation America
Global Manufacturing of Photovoltaics: Where Does the United States Stand?
Ken Zweibel, George Washington University
Financing Photovoltaics in the United States
Steve OâRourke, Deutsche Bank Securities
The Toledo, Ohio, Solar Cluster
Norman Johnston, Solar Fields LLC, Calyxo GmbH, and Ohio Advanced Energy (OAE)
Congresswoman Marcy Kaptur (D-Ohio)
Panel V: Next Generation: The Flex Display Opportunity
Moderator: William Harris, Science Foundation Arizona
New and Synergistic Opportunities in Flexible and Printed Electronics
Mark Hartney, FlexTech Alliance
Advancing Technology Through Measurement Science at NIST
Eric K. Lin, National Institute of Standards and Technology
Bob Street, Palo Alto Research Center
Panel VI: Roundtable DiscussionâKey Issues and Next Steps Forward
Moderator: Congresswoman Gabrielle Giffords (D-Arizona)
Jim Ryan, Joint School of Nanoscience and Nanoengineering, Gateway University Research Park, Greensboro, North Carolina
Eric Daniels, BP Solar
Mark Pinto, Applied Materials
Richard Bendis, Innovation America
Charles Wessner, The National Academies
Clark McFadden, Dewey & LeBoeuf LLP
Senator Mark Udall (D-Colorado)
Panel I: Partnering for Photovoltaic Technologies
Moderator: Congresswoman Gabrielle Giffords (D-Arizona)
U.S. Photovoltaic Roadmap: Perspective of the Manufacturing Industry (1)
Subhendu Guha, United Solar Ovonic (Uni-Solar)
Perspective of the Manufacturing Industry (2)
David Eaglesham, First Solar
Panel II: Advancing Solar Technologies: The Department of Energy
Moderator: Alicia Jackson, U.S. Senate Committee on Energy & Natural Resources
The U.S. Department of Energyâs Perspective
Kristina Johnson, Under Secretary, U.S. Department of Energy
DoE Solar Energy Technologies Program: Accelerating the U.S. Solar Industry
John Lushetsky, Acting Deputy Assistant Secretary, U.S. Department of Energy
Bringing Department of Energy Innovations to Market
Carol Battershell, Senior Advisor for Commercialization and Deployment, Energy Efficiency and Renewable Energy, U.S. Department of Energy
Panel III: Facilitating Solar Innovation: Contributions from Other Federal Agencies
Moderator: Richard Bendis, Innovation America
Measurement and Standards: The Role of NIST
Kent Rochford, Acting Director, Electronics and Electrical Engineering Laboratory, National Institute of Standards and Technology (NIST)
The NSF Model: The Silicon Solar Consortium
Thomas W. Peterson, Assistant Director, NSF Directorate of Engineering
Photovoltaic Manufacturing in the United States: A University Perspective
James Sites, Colorado State University
Panel IV: Advances in Photovoltaic Manufacturing: Intermediating Institutions
Moderator: Pete Engardio, BusinessWeek
A Solar Product Development Center
Stephen Empedocles, SVTC Solar
Industry-University Partnership for Photovoltaic Technologies
Nolan Browne, MIT-Fraunhofer Center for Sustainable Energy Systems
The SEMATECH Model: Potential Applications for PV
Michael Polcari, SEMATECH
The Semiconductor Research Corporation (SRC): A Proven Means to Fund Relevant Research
Larry Sumney, Semiconductor Research Corporation
PV Technology Roadmaps and Industry Standards: An Associationâs Approach
Bettina Weiss, PV Group
Panel V: Building a Solar PV Roadmap
Moderator: Clark McFadden, Dewey & LeBoeuf LLP
Ken Zweibel, George Washington University
Observations on Building a PV Roadmap Panel
Doug Rose, SunPower
Roundtable: Next Steps for Government-Industry Collaboration in Photovoltaic Technologies
Moderator: John Lushetsky, U.S. Department of Energy
Doug Rose, SunPower
Charlie Gay, Applied Materials
Kevin Hutchings, IBM
John Gloekler, Apogee Solar
James Moreland, SolarWorld
B. July 29, 2009, Symposium, State and Regional Innovation InitiativesâPartnering for Photovoltaics Manufacturing in the United States: Biographies of Speakers and Participants List
The global economy is characterized by increasing locational competition to attract the resources necessary to develop leading-edge technologies as drivers of regional and national growth. One means of facilitating such growth and improving competitiveness is to foster more robust innovation ecosystems through the development of public-private partnerships, industry consortia, and other regional and national economic development initiatives.
Many U.S. states and regions have developed programs to attract and grow companies as well as attract the talent and resources necessary to develop a knowledge-based economy. These state and regionally based initiatives have a broad range of goals and, increasingly, include significant resources. They often have a sector-based focus and, in many cases, are developed in partnership with universities and private foundations.
However, there has been little or no recent analysis of the role of these innovation partnerships. Despite the growing importance and growth of state and regional programs, relatively little is known about their goals, mechanisms, funding levels, accomplishments, and complementarities with federal programs.
STATEMENT OF TASK
An ad hoc committee, under the auspices of the Board on Science, Technology, and Economic Policy (STEP) is conducting a study of selected state and regional programs in order to identify best practices with regard to their goals, structures, instruments, modes of operation, synergies across private and public programs, funding mechanisms and levels, and evaluation efforts. The committee is reviewing selected state and regional efforts to capitalize on federal and state
investments in areas of critical national needs. This review includes both efforts to strengthen existing industries as well as specific new technology focus areas such as nanotechnology, stem cells, and energy in order to gain an improved understanding of program goals, challenges, and accomplishments.
THE CONTEXT OF THIS REPORT
Since 1991, the National Research Council, under the auspices of the Board on Science, Technology, and Economic Policy, has undertaken a program of activities to improve policymakersâ understandings of the interconnections of science, technology, and economic policy and their importance for the American economy and its international competitive position. The Boardâs activities have corresponded with increased policy recognition of the importance of knowledge and technology to economic growth. New Growth Theory in economics also emphasizes the role of technology creation as a driver of local and regional growth.1
Recent economic analysis also suggests that high technology is often characterized by increasing rather than decreasing returns, justifying to some the proposition that governments can capture long-term advantage in key industries by providing relatively small, but potentially decisive support to bring regionally based industries up the learning curve and down the cost curve. In part, this is why the literature now recognizes the relationship between technology policy and trade policy.2 Recognition of these linkages and the corresponding ability of governments to shift comparative advantage in favor of the state, regional, and national economy provide the intellectual underpinning for government support at all levels for high-technology industry.
STEP seeks to bring new insight to bear on issues of national interest though its analyses of specific industries and technologies.3 The Boardâs research addresses both demand and supply side realities, the contribution of R&D partnerships, and efforts to enhance U.S. competitiveness. This approach is of particular relevance to current initiatives to create and/or reinforce clusters of firms able to
____________________
1Developed in the 1990s, New Growth theories highlight the role of innovation as the main driver for economic development, with the implication that policies that embrace openness, competition, change and innovation will promote growth. See Paul M. Romer, âEndogenous technological change,â Journal of Political Economy October 1990. Also see Gene M. Grossman and Elhanan Helpman, âEndogenous innovation in the theory of growth,â The Journal of Economic Perspectives 8(1):23â44, 1994.
2J. A. Brander and B. J. Spencer, âInternational R&D rivalry and industrial strategy,â Review of Economic Studies 50:707â722, 1983, and âExport strategies and international market share rivalry,â Journal of International Economics 16:83â100, 1985.
3National Research Council, Innovation in Global Industries: U.S. Firms Competing in a New World, J. Macher and D. Mowery, eds., Washington D.C.: The National Academies Press, 2008. This report follows a previous review of U.S. industrial performance by STEP. See National Research Council, U.S. Industry in 2000: Studies in Competitive Performance, D. Mowery, ed., Washington, D.C.: National Academy Press, 1999.
meet new needs and contribute to improved U.S. competitiveness and the creation of high-value employment in the United States.4
Public-private partnerships are increasingly recognized as important elements for the support of innovation-led growth because of their contribution to the commercialization of state and national investments in research and development. As documented by recent National Research Council analysis, technology partnerships can be critical to generating an environment supportive of technologies that can have economic benefits with regional and national impact.5
One important element of STEPâs analysis concerns the growth and impact of foreign technology programs.6 U.S. competitors have launched substantial programs to support new technologies, small firm development, and consortia among large and small firms to strengthen national and regional positions in strategic sectors. Some governments overseas have chosen to provide public support to innovation to overcome the market imperfections apparent in their national innovation systems.7 They believe that the rising costs and risks associated with new potentially high-payoff technologies, and the growing global dispersal of technical expertise, underscore the need for national R&D programs to support new and existing high-technology firms within their borders.
Similarly, many state and local governments and regional entities in the United States are undertaking a variety of initiatives to enhance local economic development and employment through investment programs designed to attract and grow knowledge-based industries.8 These state and regional programs and associated policy measures are of great interest for their potential impact on U.S. competitiveness. STEPâs project on State and Regional Innovation Initiatives is intended to generate a better understanding of the challenges associated with the transition of research into products, the practices associated with successful state and regional programs, and their interaction with federal programs and private initiatives. The project seeks to achieve this goal through a series of complementary assessments
____________________
4See Charles W. Wessner, Growing Innovation Clusters for American Prosperity, Washington, D.C.: The National Academies Press, forthcoming. See also Karen G. Mills, Elisabeth B. Reynolds, and Andrew Reamer, Clusters and Competitiveness: A New Federal Role for Stimulating Regional Economies, Washington, D.C.: Brookings, April 2008.
5National Research Council, Government-Industry Partnerships for the Development of New Technologies, Charles W. Wessner, ed., Washington, D.C.: The National Academies Press, 2003.
6National Research Council, Innovation Policies for the 21st Century, Charles W. Wessner, ed., Washington, D.C.: The National Academies Press, 2007.
7Most notably, a number of countries are investing significant funds in the development of research parks. For a review of selected national efforts, see National Research Council, Understanding Research, Science and Technology Parks: Global Best Practices, Charles W. Wessner, ed., Washington, D.C.: The National Academies Press, 2009.
8For a scoreboard of state efforts, see Robert Atkinson and Scott Andes, The 2008 State New Economy Index: Benchmarking Economic Transformation in the States, Kauffman Foundation and ITIF, November 2008.
of state, regional, and federal initiatives; analyses of specific industries and technologies from the perspective of crafting supportive public policy at all three levels; and outreach to multiple stakeholders. The overall goal is to improve the operation of state and regional programs and, collectively, enhance their impact.
STEP MEETINGS ON PHOTOVOLTAIC MANUFACTURING
Gathering representatives from leading producers of photovoltaics, congressional staff, leading academics and industry analysts, and representatives from relevant government agencies, STEP convened two meetings, held in April and July 2009, to examine the future of the U.S. photovoltaic industry and the practical steps that the federal government and some state and regional governments are taking to develop the capacity to manufacture photovoltaics competitively. Drawing on the experiences of related industries, meeting participants explored the prospects for cooperative R&D efforts, standards, and roadmapping efforts that could accelerate innovation and growth of a U.S. photovoltaics industry.
This report captures the presentations and discussions of these two symposia on the future of photovoltaic manufacturing. It includes a common introduction and summaries of the presentations at both meetings. This workshop summary has been prepared by the workshop rapporteur as a factual summary of what occurred at the workshops. The planning committeeâs role was limited to planning and convening the workshops. The statements made are those of the rapporteur or individual workshop participants and do not necessarily represent the views of all workshop participants, the planning committee, or the National Academies.
ACKNOWLEDGMENTS
On behalf of the National Academies, we express our appreciation and recognition for the insights, experiences, and perspectives made available by the participants of the meetings. We are also grateful to John Lushetsky of the Department of Energy, John Fernandez of the Economic Development Administration, Marc Stanley of the Technology Innovation Program of the National Institute of Standards and Technology, and Christina Gabriel of The Heinz Endowments for their interest and support of this project.9
We are indebted to Alan Anderson for his preparation of the meeting summaries. Sujai Shivakumar prepared the draft introduction to this volume and David Dierksheide prepared the report manuscript for publication.
____________________
9As of July 2009.
NATIONAL RESEARCH COUNCIL REVIEW
This report has been reviewed in draft form by individuals chosen for their diverse perspectives and technical expertise, in accordance with procedures approved by the National Academiesâ Report Review Committee. The purpose of this independent review is to provide candid and critical comments that will assist the institution in making its published report as sound as possible and to ensure that the report meets institutional standards for quality and objectivity. The review comments and draft manuscript remain confidential to protect the integrity of the process.
I wish to thank the following individuals for their review of this report: Nancy Bacon, United Solar Ovonic and Energy Conversion Devices, Inc.; Robert Collins, University of Toledo; Stephanie Shipp, Institute for Defense Analysis; Richard Swanson, SunPower; and Cyris Wadia, Haas School.
Although the reviewers listed above have provided many constructive comments and suggestions, they were not asked to endorse the content of the report, nor did they see the final draft before its release. Responsibility for the final content of this report rests entirely with the author and the institution.
Charles W. Wessner
Rapporteur