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Object type:Contribution
Name/Title:Solar Startups Power through Recession
Content:

The last year has seen a crash in the global economy, fueled by an overly-derived housing market and the poor banking that accompanied it. Still the sun keeps on shining. And many solar startups that enjoyed the boom of 2006 and 2007 are finding ways (and help) to muscle through the current recession.

At the scariest of times, when the stock market halted and federal solar tax credits threatened expiration, you could almost feel the sweat on solar CEO faces. Venture capital began drying up. Many companies, in an industry that had been nearly doubling every year, began laying off employees -- a move that was nigh unthinkable the year before.

But just when things were darkest, when knuckles were white and teeth chattering, the solar tax credits that had struggled so hard under the Bush administration finally passed as an addendum to the massive bailout bill. The extended credits, which also removed the credit cap on residential solar systems, gave many solar startups a big boost.

Yet some tax credits alone do not heal an ailing economy. Enter a new administration and a new stimulus package -- a package chock full of renewable energy-friendly funding and initiatives. Now a spark of positivity can be seen and the hiring bell can be heard across the solar industry as every sector, from manufacturing to installation, gears up.

There are four interrelated reasons why solar startups are now poised to power through the recession and, as is hoped, re-energize the economy as a whole.

  1. The stimulus package provides funding and security for many solar startups, including a streamlined tax credit process and some direct funding.

  1. Increased supply seemed like a bad thing, but with demand again rising the surplus should equal a decline in equipment prices -- key to selling homeowners on solar power's initial costs.

  1. General consensus maintains that solar and renewable power are our best bet for healing our fragile economy and infrastructure. That commitment alone is a confidence boost for investors and spells dividends for solar startups.

  1. Utilities are now allowed in on the tax credit game. That combination of direct tax benefits and renewable energy standards makes utilities big, and wealthy, friends to the solar industry.

Before anyone's hands get sore from clapping and back-patting, remember that the economy is far from out of the woods -- despite the sunlight peering through the canopy. The stock market is still quite volatile and apprehension is still a common theme among consumers, yet a general sense of positivity pervades the solar industry. Retail stores, SUV dealers and the like are very nervous, and rightly so, but there is a big difference between extra-big cars or expensive clothing and the energy that must power our future.

Fortunately for solar startups...solar is just getting started.

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