Another US Solar Company Claims Bankruptcy
Following similar announcements of closures and bankruptcies from Evergreen Solar and Solon, the US solar manufacturing sector has taken another hit with media reporting that SpectraWatt has filed for Chapter 11 protection after only 12months of plant operation with debts near $38.7 million and assets of $34 million. The company is seeking to sell off its assets in a fire sale to meet creditors demands. There is still confusion as to what has occurred to state funded inducements the company received.
SpectraWatt was the highly anticipated spin off from Intel in 2008 and they remain major shareholders. Like the other US companies in financial trouble, the company is citing its need for creditor protection is due to increased competition and decreasing prices in the industry. Chinese competition is singled out as a major cause of the problems.
The move is a sign of a bigger problem facing US solar and PV manufacturers with both SpectraWatt and Evergreen stating their products were no longer competitive in comparison to Asian competition and there was no way they could reduce their costs in the USA to create a competitive product. SpeactraWatt is seeking to sell the assets as soon as possible as they fear a glut of second hand manufacturing equipment and expect more USA companies to fail.
Other technology industries have seen the migration of manufacturing from the US to Asian regions but this normally occurs after the US sector has had time to develop. If current trends continue, the USA may lose its local manufacturing capacity and become ever more reliant on products outside of the region. This will put further pressure on the US government to consider how they spend on renewable solutions if the solutions do not include local investments and jobs. Another change in global economies is that such a US problem would have far reaching implications for the global market but with China, India and others to record massive growth, the global industry could probably deal with a reduction in US spending. Certainly much easier than a decade ago.
