Silicon Valley Is Bullish On Solar
Has solar power really hit the steep part of the hockey stick
growth curve? Cypress Semiconductors' CEO, T J Rodgers, thinks so
by Lee H. Goldberg
Perhaps the biggest surprise of this year's DesignCon was to find that solar power technology was featured at a keynote presentation. Of course it was a bit less of a surprise since the keynote speaker, Cypress' CEO, T.J. Rodgers, is an investor in SunPower, a manufacturer of high-efficiency solar cells. Nevertheless, the bottom-line-oriented CEO's analysis of the economics of renewable energy was eye-opening, and certainly explains the recent wave of interest in green-tech amongst the Sand Hill Road VC types.
Rodgers postulated that thanks to improvements in efficiency and scale of production, solar technology has just entered the "hockey stick" portion of a growth curve that will soon drive the cost of solar energy low enough to compete with fossil fuels in mainstream applications. He explained that "back in 1976 when Dick Swanson had been working on solar cells for at least four years, a watt cost $62. We've now driven down the cost of a watt to about $3.67, and we can see our way to making a profit by selling a watt for $2."
Citing 2002 as an important "breakover moment" Rodgers pointed out that in that year the industry's total shipments amounted to about 1000 MW, the same amount of capacity that the entire photovoltaic industry had produced from 1976 to the year 2000. "That's an important number," he explained, because most of the 400 power plants across the US generate between 1000 MW and 1200 MW. "Now that we are at this magic number of 1000 MW in each of three years, it is a fact that the solar industry preempted the need to build a large power plant. So, three big plants didn't need to get built somewhere in the world because the solar industry provided the power exactly when it was needed."
And Rodgers pointed out that this maybe just the beginning of the solar boom. "The total available market for the solar industry in 2005 was 1300 MW" he said, explaining that this amounted to a compound annual growth rate (CAGR) of 31%. "Compared to semiconductors which in the old days grew at about 17%; since roughly 1995 semiconductors have grown at 10% or 12% and we consider that a fast-growing industry," he concluded.
With all the other challenges facing designers as they push the limits of physics and common sense to build the next generation of electronics it's unlikely we'll see DesignCon becoming a solar energy show. But if Rodgers' enthusiastic predictions have any validity at all we might see renewable energy technologies taking their rightful place alongside deep submicron design tools and 100-Gbit/s Ethernet technologies in the schedule of technical sessions at DesignCon 2007.
Comments, frustrations, offers of free solar panel installations? Write me at: lgoldberg@green-electronics.com
|