Thursday, May 14, 2009

Reality Sets In On Solar

Speaking at a conference in La Jolla yesterday, BP CEO Tony Hayward called solar power a lemon. As reported by Reuters:

"BP CEO Tony Hayward said on Wednesday solar power technology was unlikely to ever be competitive with more conventional energy sources.

"I think solar is probably the most challenged of all of BP's alternative energy interests," Hayward said.

"It is not going to make the transition to be competitive with more conventional power, the gap is too big...if solar is going to make a breakthrough, there will be a technology disintermediation step," he added."

This is a stark assessment from a genuine industry leader-- BP has an entire subsidiary, BP Solar, devoted to solar energy with installations in over 160 countries and more than 2200 employees. However, it isn't entirely unexpected- the writing has been on the wall.

The Financial Times called Haywards comments, "a further sign of the company’s move away from renewables towards oil and gas."

The FT also notes, "BP has invested hundreds of millions of dollars in making solar cells and components, but in the past six months it has been closing factories around the world, and announced a sharp cut in its investment in alternative energies, such as solar, from $1.4bn last year to $1bn (£658m) this year."

It's going to take the force of sheer political will to continue the proliferation of infrastructure for solar and other uneconomic sources of alternative energy, which is not to say it will not happen. In places like Washington, D.C. and Sacramento, money is no object.