Young US solar industry: all geared up and waiting to fill your orders

Greater use of solar energy in the United States waits on you, the American consumer. This was the consensus of solar energy advocates in the government and in private industry as a major conference promoting the use of sun power opened here May 11 in the nation's oil capital.

"The gearing-up process is largely over" for the solar heating and cooling industry, says Paul Cronin, founder of Sunsave Inc., a Massachusetts manufacturer of solar collectors and vice-president of the Solar Energy Industries Association, sponsor of the Houston conference. He says the solar heating and cooling industry, although only about six years old, has ironed out the major technological and management problems that typically beset a new industry. Now it must concentrate on gaining broader consumer acceptance of its products.

"If anything, you would have to say the industry is constrained by the market , not vice versa," agrees Robert Jordan, director of the passive solar energy division of the US Department of Energy (DOE).

Mr. Jordan says more aggressive marketing and promotion of residential solar energy products is needed to increase their use in the United States. "The market is so new, it is a question of selling solar heating and cooling systems as appliances that benefit consumers," he says.

Solar industry officials see plenty of reasons why demand for their products will grow briskly in 1980, notwithstanding the troubled national economy.

The recently passed windfall profits tax expanded the residential tax credit for solar installations to 40 percent of investment up to $10,000. And Congress is working on legislation to establish a federal energy bank that would make low-interest loans for solar investments.

Indeed, the government is the single largest factor in the solar industry. Federal expenditures for solar energy are expected to reach $800 million for the fiscal year 1980. The industry itself had estimated sales of $400 million to $ 500 million last year.

Ryc Loope, vice-president of Sunworks, a New Jersey manufacturer of solar air and water heating systems, expects the industry to begin tapping what he considers the mass market for the first time in 1980.

"We've been selling to basically an experimental-type buyer that represents 4 percent of the market," he says. But with expanded government incentives and better products, he sees a much broader segment of society now on the verge of investing in solar energy.

Although a recession has apparently begun, Mr. Loope ventures that it could bode well for the solar industry this year. During economic downturns, he says, people tend to invest more in upgrading their properties, and this could spur more retrofitting of homes for solar applications.

Still, consumers will have to be willing to make a sizable initial investment. A solar water heater costs between $1,000 and $3,000 and a full system for heating and cooling a home costs about $10,000.

The solar industry has grown dramatically since 1974. Since then the number of US manufacturers of solar collectors -- the largest commercial segment of the industry -- has increased from 45 to 347, according to the DOE. The total square footage of solar collectors sold in the US has jumped from 1.2 million six years ago to 14.3 million in 1979.

Another smaller part of the industry deals with the development and application of photovoltaic cells, which convert sunlight directly into electricity. Although this field also is growing rapidly, it is not expected to achieve wide commercial use for several years.

Yet, despite impressive growth, the solar industry remains none to prosperous. Mr. Cronin estimates only a handful of companies in the solar heating and cooling business have turned a profit, and he says many of the firms that pioneered solar energy in the early 1970s are no longer in business.

But he says he believes the "shake out" phase now is pretty well completed, leaving behind a solid core of firms that are increasingly geared to sales and marketing as well as technological innovation.

Indeed, a recent report by the American Petroleum Institute indicates increased interest in the solar field by major corporations, including large oil companies.

It noted that three oil firms -- Exxon Corporation, Atlantic Richfield Company, and Shell Oil Company -- are commercially producing solar devices, and eight petroleum companies are involved in solar research.

The report estimated oil industry investment in solar energy through 1978 at industry.