Larry Bawden talks about the switch from Hydrogen to Solar Energy. He addresses the immense potential in Solar Energy. Bawden notes that this spaces has a very high investment rate in the past and believes that solar is a clean way to convert electricity.
So why solar? Why did I switch from hydrogen to solar? There will be nice niche markets for hydrogen for a while. Moving it around, having it compatible with codes and regulations and standards from counties to cities to states to federal governments is a challenge. Luckily, the federal government has not figured out how to regulate the sun. I'm sure it's coming. I'm sure it will happen, but as of now, they haven't done that. If you look at the watt hours per year the sun can produce versus all the other resources on earth, this is obvious. It's 360 million terawatt hours annually compared to anything else up there. So how can you not do that? It has been around for 56 years but there hasn't been much advancements or much investment thrown in the sector until the last 18 months; $500 million in just the US. It has been $500 million in solar energy just last 18 months in just our country. That's not worldwide. It was unbelievable. So you've gone from a total of 100 over 50 years to 500 in 18 months. So all kinds of things are happening out there. A lot of countries and other nations are seeing the same answer. How can you choose to ignore this? We have to tap into this resource because on top of this is an extremely way to convert clean electricity.
Larry Bawden addresses the challenges in producing Solar Energy on a commercial scale. He highlights the capital intensive requirements in this field. He also notes the importance of precise nano-engineering in the manufacturing process.
Yes, it's capital intensive. I don't have the answer to this question, but all the companies that have been funded are putting their own plans in. They're scaling their own manufacturing processes up. To put a 50 megawatt plan in, it's about 25 to 50 million. It depends on which technology you're trying to bring up. So it's very expensive. That's just the equipment to put on the floor. It's not the labor. It's not the material. It's not the building. It's just the equipment to build it. It's a science of putting very precise layers down with no flaws very much like a semiconductor. Absolutely perfect layer and very thin microns. We're dealing in nanometers which is 90 % thinner. You would think it would be harder. It's not. We actually are using a process, electroplating versus vacuum. So we're going simpler and easier. I know that sounds strange but our substrate material, the way we have it setup is more conducive for easier manufacturability and more precise. So we are going to put our own line in initially. We are looking at scaling contract manufacturing after the line. It's a way for us to control the processes when we first bring it in, and to know what the secret sauce is so we can teach others to bring it up under licensing. Yes, it's capital intensive. Everyone has done it the way you described it.
Larry Bawden discusses the immense potential in Solar Energy by illustrating the high demand for this alternative source. He notes that there is huge demand from a variety of sources - residential houses to large industries. He also highlights the fact that substantial demand for this energy source is international.
The demand is so high right now. I'll just give you one example. There's a company by the name of First Solar. Deep in my heart, I want to be at First Solar. They did an IPO last year, 2006, and raised $600 million. They're worth $10 billion. It's a startup on Yahoo story on solars. It's unbelievable. There is so much demand they sold out almost two years' supply for $1.5 billion in just modules. They don't know where those modules are going, but all the power providers came in and bought it all up because they saw a huge storage. So I don't know if we'll know we're exactly the applications our modules will go to. It could go to houses, residential, industrial or go to solar firms. I don't know. Probably in its own through power providers which are big organizations that come in and finance the entire buy and they finance the entire install. They collect all the money to become the small PG&Es. They just let you have it for your surface area of your house. It has become a very nice model if you have enough surface area to let them be interested in it. So I'm not sure where we'll go but everyone's taking care of that very quickly, mostly overseas. A lot of stuff is getting shipped over to Germany and Japan, believe it or not.
Larry Bawden discusses the competitive strategy in solar energy start-ups lies in bringing vertical integration to your product mix. He believes that there is a huge potential for any viable technology in the value chain. He notes that continuous improvement of technology is key to the success of a company in this field.
So you ask yourself: How you can compete against the big guys? How can you, guys, or myself compete against Sharp? That's how I look at that. Sharp, the biggest solar panel supplier in the world. Well, if you look at some of the things in the past, it wasn't the wagon makers that made the cars. Right? You get in this paradigm mode and you can't break out of it. So the guys who built Sharp panels are going to continue to build really good Sharp panels the same way; continuously to build it. Are they going to really take third generation, fourth generation and fifth generation seriously? Probably not. So it's meant for startup companies. I've seen that now for the last five years. It's very interesting. I'll just pick another one. Semiconductors, they come back in twos. No one was even near that. It was right in their backyard. This whole different way to solve the problem in a different paradigm. So that's creating the opportunity for young companies and successful startups. Another thing I'd like to think about is that 10 years ago, there were 70 million internet users. Today, 1.2 billion; 20 % of the world's population. It has not been around that long. It's an amazing statement if you think about that. Amazing. Google wasn't even around. Look how big they are. First Solar was only worth $100 million 2-1/2 years ago. Now is the time to start your own company. It's amazing what's happening out there. Then, the solar space was nothing besides a very small niche market. It has quadrupled in size in just months. So I predict that will happen across all the clean techs out there. It's has been happening for a while and will continue to.