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VOL. 124 | NO. 140 | Monday, July 20, 2009

Here Comes the Sun: Memphis’ cut of the state’s solar energy plan

By Bill Dries

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The Sharp Manufacturing plant in Hickory Hill has always been a symbol as much as a working part of the city’s economic infrastructure.

The plant on South Mendenhall Road represents the city’s first truly international big business presence. It opened in 1978 after Japanese executives came to Memphis to negotiate directly with city leaders. And once the deal closed, a now-legendary picket line was thrown up by local union leaders. The picketing symbolized organized labor’s determination to have a voice in local economic development.

For most of the plant’s life, it has been where Sharp made television sets and microwave ovens. Even in a national recession, the Memphis Sharp plant runs 24 hours a day with three shifts working an assembly line. But it isn’t TVs that roll out of the Memphis plant anymore. Sharp executives moved the production of televisions to Mexico in 2000.

Last year, the 1 millionth solar panel, or module, rolled through the Memphis production line.

Hot commodity

The promotion of solar energy on a national scale has never been hotter, pardon the pun. But it comes in a national recession that has boldly highlighted what has been solar’s Achilles heel for the past 30 years – its expense compared to conventional energy sources.

Workers in Sharp’s 24-hour-a-day assembly line wear gray sleeveless vests with blue cuffs. The line is not an automated wonder with only an occasional human presence, and the workers can listen to music.

The scale of the machinery doesn’t tower over the workers. And it is work that couldn’t be done without human hands.

“It’s labor intensive,” said T.C. Jones Jr., Sharp’s vice president of human resources and general affairs.

U.S. Labor Secretary Hilda Solis toured the plant in June as she promoted the Obama White House’s green initiatives in several cities. As she walked the line, a worker wearing plastic fingertip coverings soldered key parts of the direct conversion solar panels that use semiconductors embedded in a thin, flexible vinyl sheet. A worker layed out the sheet like a bedspread, pushing out wrinkles with her hand as she leaned over it for a closer inspection.

A solar array on the roof of the Terre House in Uptown is one of a few photovoltaic arrays that are currently operating in West Tennessee. -- PHOTOS BY LANCE MURPHEY

Heat from curing ovens could be felt faintly as fans whirred nearby. Another worker farther down the line watched a computer monitor as a wall of fluorescent light tubes flashed on while a new solar panel rolled into place in front of the light bank.

“This can be residential or commercial. Each one of these panels has a particular wattage,” Jones told The Memphis News. “All of them are 100 percent inspected to make sure that we maintain a consistency as it relates to wattage for each panel.”

The Sharp plant is an existing cornerstone of a still-forming Tennessee solar energy industry.

Gov. Phil Bredesen has embraced the idea and spent political capital on the ambitious goal aided by tens of millions of dollars in federal stimulus money and rapidly evolving solar technology.

“We’re seeing the resurgence of solar across the country,” said Ben Taube, executive director of the Atlanta-based Southeast Energy Efficiency Alliance. The nonprofit organization covers 11 states including Tennessee and has watched Bredesen’s initiatives closely.

“I think that the state is positioning itself to be a solar leader in many ways,” Taube told The Memphis News. “And the state of Tennessee has allocated a good portion of its (federal) energy dollars … to create a solar industry in the state.”

Earth, wind and fire

The semiconductors necessary for the types of solar cells manufactured by Sharp and others will be made at the new Hemlock plant in Clarksville. The new Wacker Chemie plant in Cleveland, Tenn., will process hyper pure polycrystalline silicon, which is called “polysilicon.”

“This shiny gray metal is the key raw material for virtually thousands of different products,” said Wacker Chemie president and CEO Dr. Rudolf Staudigl at the March announcement of the new plant in Cleveland.

Polysilicon is the starting material for solar cells and Wacker Chemie is the world’s second-largest supplier and processor of it.

A worker takes a break near an array of solar panels outside the Sharp Manufacturing plant in Hickory Hill.

The Wacker Chemie plant and the Hemlock plant are billion-dollar investments each and were part of a trio of billion-dollar economic development plums announced by Bredesen in an eight-month period starting in late 2008. The third was the Volkswagen auto plant in Chattanooga.

The government dollars Bredesen is using are the state’s share of energy-related funding coming as part of the federal stimulus program. Bredesen has committed most of that $62.5 million to form the Volunteer State Solar Initiative, which is an economic development program as well as a solar energy program.

“The point I want to make to Tennesseans is that this is not a sidebar issue, but the focal point of a coordinated plan,” Bredesen said in one of a series of speeches this spring and summer across the state. “The idea is to drive right on through this and try to put the finishing touches on this and put Tennessee forward into a real leadership position. There are going to be in the years ahead other Silicon Valleys and other research triangles.”

The federal stimulus money will be split between a Tennessee Solar Institute at the University of Tennessee-Knoxville and Oak Ridge facilities for research and development and a “megasite” in Haywood County, a rural West Tennessee industrial site that would feature a solar power plant on part of 1,720 acres.

“The solar plant we wanted to put on the megasite maybe as a way to give it a green feel,” Bredesen told The Memphis News. “West Tennessee is the best place for a solar farm in terms of just the amount of sunlight that is here and obviously the availability of open land. But the vast bulk of that site and the economic activity would come from an operation of the plant.”

The solar array would be a “solar farm” with about 20 acres in the beginning. It could include a visitors’ center for tourists and business executives. It would generate five megawatts of power – enough to power 500-600 homes. And Bredesen said he hopes to use cells from the Memphis Sharp plant to create “a showcase for Tennessee solar products and our commitment to this.”

A solar array on the roof of the BRIDGES building in Uptown provides energy to the TVA. The site is one of a few photovoltaic arrays that are currently operating in West Tennessee.

The Tennessee Valley Authority has agreed to buy power generated at the farm at a premium over a wholesale price that will amount to at least $1 million annually. The money will be used to expand the solar array.

“Once we plant this thing, it is going to continue to grow,” Bredesen said earlier this summer, continuing the farm metaphor.

Bredesen was in Europe last month, calling on an unnamed corporation he hopes to entice to the Haywood County site.

“These things take time,” he told The Memphis News. “It’s not going to happen tomorrow and it might not happen on my watch, but obviously a major industry that employed thousands of people and all the spinoffs from that at that site in the green area would be a huge hit for West Tennessee.”

Just before Bredesen went calling in Europe, Republicans in the state Legislature voted to kill the federal funding pass-through in the state budget for the megasite and the solar institute. Bredesen told them and Democratic legislators the decision was “stupid” – unusually strong language for Bredesen. He talked with Republican legislative leaders who attributed the problem to a lack of communication. They backed down after Bredesen warned, “We’re deep in veto territory here.”

Southern exposure

There appears to be truth in the idea that one part of the country or state can be a better location for a solar farm and solar energy production than another.

It’s a point Ken Zweibel, founding director of the George Washington University Solar Institute, made in a 2008 article in Scientific American.

“A Solar Grand Plan” was a bold call for solar power development as the chief way to end U.S. dependence on foreign oil as well as cut greenhouse gas emissions.

Zweibel has worked in solar photo-voltaics (pv) for 30 years. While at the Department of Energy’s National Renewable Energy Lab, he was a key player in the development of thin film pv, the kind used at Sharp’s Memphis plant.

Zweibel and two other solar energy proponents, James Mason and Vasilis Fthenakis, called for a “vast area” of solar cells in the southwestern United States as part of a “massive switch” to solar energy by 2050 in which solar plants would supply 69 percent of the nation’s electricity and 35 percent of its total energy.

More than 1 million solar panels have been produced at the Sharp Manufacturing plant in Hickory Hill since it moved the production of televisions to Mexico in 2000.

Zweibel told The Memphis News their focus on the Southwest wasn’t meant to be exclusive, although the sunlight there is different than in the Southeast.

“Yes, the Southwest has the best sunlight,” he said. “But the rest of the country has good sunlight and some areas of the Southeast have very good sunlight, especially parts of Florida. Tennessee is probably closer to an average (amount of) U.S. sunlight. … It’s still good enough to make plenty of electricity. But it’s not as inexpensive as if you used it in a higher-sunlight location.”

Blair Brown, director of construction and communications for the Memphis Area Homebuilders Association, said today’s solar panels have come a long way from the heavier, bulkier models of the late 1980s and early 1990s. Even with the changes, though, “Our humidity fogs its ability to receive the sunlight,” Brown said. “If there is no humidity and they are at a little bit higher elevation, it’s just direct intense uv (ultraviolet) rays. Here we get haze. We get some fog. Just like clouds, (it) would hamper the ability for (the panels) to receive sunlight.”

So because it’s more expensive to produce electricity from sunlight in Memphis than in the Southwest, consumers would pay more – more than the cost of electricity provided by the Tennessee Valley Authority through Memphis Light, Gas and Water Division.

Zweibel has had some second thoughts on cost since laying out the solar plan a year and a half ago in Scientific American. Solar energy production probably shouldn’t be focused exclusively or mostly in the Southwest, he now says. The reason is that the cost of transmitting the electricity from a vast Southwest solar power plant to Memphis could run the cost of the energy close to or over what it would cost for locally produced solar energy.

Ozell Grandberry, 55, cools off under a shade tree that he planted nearly 40 years ago in Fredonia, Tenn. Grandberry has high hopes for new jobs in the area, if Gov. Phil Bredesen brings a solar power plant to a nearby farm. The solar array would initially be 20 acres and would generate 5 megawatts of power.

“The upshot is that it’s not absolutely clear what the best approach is going to be,” Zweibel said. “We’re still working that out. … When I wrote the article, I might have thought 80 percent (solar energy production) in the Southwest. Now I might say 60 or even 50 percent, and the rest of the country would have its own locally distributed solar energy.”

Power players

The Memphis Sharp plant is an example of what could be and what is the most viable current use of solar panels and solar energy conversion. The plant not only makes solar cells for the market, it uses them to provide some power to the plant. The solar array toward the back of the plant produces enough energy that Sharp sells some to MLGW each month.

“It’s not common at all,” said MLGW President Jerry Collins. “It’s very uncommon.”

The reason is economic or what Collins termed a “cost benefit situation.”

“Solar panels in the Memphis area are more expensive in terms of total life cycle costs at this point than the electricity we buy from the Tennessee Valley Authority,” he said. “But if you’re able to get a federal grant to offset a portion of the cost, then it can quickly become very cost-effective.”

Congress recently voted to continue a 30 percent tax incentive for the installation and use of solar technology that Taube said helps to make the expense bearable, especially when combined with state and local government incentives.

“It’s still an expensive technology that does need some subsidies,” Taube told The Memphis News. “Once you’ve invested that first cost into the technology, your generation starts immediately. It will take some time to pay it back, butonce it’s paid back, it’s free energy.”

For now, though, homeowners are looking for about a seven-year payback and it’s not there.

“That’s the average time Americans spend before they move on to a different home,” said Brown. “Solar panels that generate 1 kilowatt of power are usually about $20,000.”

That’s $20,000 added onto perhaps a $250,000 new home, and Brown said right now, there are few takers willing to spend the money for $20-$35 off the monthly utility bill.

“When you start saying, ‘If you do this and spend $10,000 more, you can get this’ – $10,000 more is all they hear,” Brown said.

“If our homes were selling on a square-foot price that Los Angeles was, it might be sensible, especially with their utility costs.”

By comparison, utility costs in Memphis are 10 times lower than in New York, Chicago and Los Angeles.

“That’s why the green buildings have succeeded quicker in those areas,” Brown said. “The consumer has to see the value in it. If you don’t, you’re just selling (a) gimmick.”

Residential tax breaks also aren’t much of an incentive, he added, since the rebates are capped at $2,000 or less.

Collins said the solar array at Sharp is “a first glimpse of the smart grid of the future.”

“One of these days, there’s going to be solar panels probably on most buildings,” he predicted. “They will be either using all of the electricity which they generate or using a part of it and sending some of it back to the grid.”

If that happens, it will be an economic decision, said Zweibel and Taube.

“Costs are coming down as much as 30 percent this year,” Zweibel said in estimating the direct effects of continuing research and development. “And they are expected to continue to come down, not necessarily at that rate. This is a bad year for sales.”

A call to the Home Depot on Riverdale Road confirmed that. “We don’t sell a whole lot of them,” an associate said. “I don’t know if the word’s not out on them or what.”

The Midtown Home Depot had none in stock and an associate couldn’t remember the last time a customer had the store order some.

Speed of light

Brown said for now, solar panels are a better match for industrial or commercial buildings.

“They really make sense and I’m a huge proponent of them on large industrial buildings and commercial buildings where they have large square-foot roof areas,” he said.

Taube said there are regulatory barriers to wider uses of solar energy that also should be reviewed. The regulations vary depending on the size of a solar array, as do incentives.

“When you have everyone at the same table, you have competing interests,” Taube said. “How do you find the opportunity to work toward a clean energy solution that has the investment component thought through, the regulatory component really spelled out, and how do you get the work done?”

Solis told those at the Memphis Sharp plant that training programs through community colleges and apprenticeship programs, and training in other settings fueled by grants, including federal Pell grant money, are imperative to giving the solar industry a stable foundation.

“It’s going to take steps,” she said. “But with that has to come a component of training. … And that takes money and that takes time.”

Time and money don’t usually move in the same direction at the same time.

Taube sees time on the side of solar plans in Tennessee because the technology seems poised to change in a way that will ease its most formidable barrier – its cost.

“We have the ability to almost jump over technology and move to the most cutting-edge technology,” he said. “We have been slow to adopt energy efficiency and renewable energy programs.

“But having the ability to look across the country and model it after those successful programs allows us to take advantage of the work and the effort that have been done for many years. The technology continues to get better and better.”

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