US cuts in solar cell funding may let Japan take the lead

When Solar cells, perhaps the most revolutionary energy source under development in the laboratories of the world, come of age, will they be stamped "Made in USA" or "Japan Inc."?

This is the biggest question raised by the Reagan administration's cutbacks in the federal solar cell (photovaltaics, or PV) program. The administration has pushed for an overall reduction in this program of more than 60 percent, down to $63 million in 1982. Congress has restored $30 million to the program, but the White House is expected to try to return the budget to the lower level. And, according to Department of Energy (Doe) sources, and budgetary ax will cut even deeper in 1983.

"By 1984 we're looking at a $10 million per year program of university research," predicts one DOE solar official gloomily. He could talk only off the record because he and his colleagues have been ordered not to discuss their programs with the press.

Many experts consider photovoltaics the most revolutionary of the solar technologies. They have several reasons. Solar cells are second cousins to the transistor. They convert light into electricity without any moving parts, or pollution.

Like the transistor, if the technical problems can be solved, it should be possible to produce the cell quite inexpensively. Since the Arab oil embargo, the price of electricity produced by solar cells has falle from $1,000 per peak watt to $10 a watt. And if the cost can be cut to $2 a watt, PV will be economically competitive with conventional electric power. Further cost reductions, if possible to less than $1 a watt, would make electricity from the sun a real energy bargain.

Testament to PV's potential is the fact that, in the United States, the big oil companies have moved aggressively into the field. Overseas, the Japanese government has made it a major element in their national energy program, and Saudi Arabi also has an extremely ambitious effort under way.

Until now, the US has held a clear lead in solar cell development. They are an American invention, having been developed as part of the space program. Following the Arab oil embargo, the US government initialed a major program to adapt this space age technology to terrestrial use.

Many materials have been found that convert light into electricity, and the US has been exploring a dozen different approaches simultaneously. Federal purchases of photovoltaic arrays helped fledging companies start up production lines and reduce the cost of these cells.

Japan, starting from behind, adopted different strategy. "The Japanese have undemocratically chosen what -- in their best judgment -- are the most promising processes," explains Steven Strong, president of Solar Design Associates. As a result, they have caught up and passed the US on one promising new approach, amorphous silicon.

With the current US cutbacks, Japan, for the first time, will "have the advantage of spending a higher total number of government and business dollars [ on PV research than the US]," observes Jack Stone, a photovoltaics expert at the Solar Energy Research Institute.

As a result, "the Japanese will blow over us like a typhoon," predicts Mr. Strong, who has designed several photovoltaic homes. This view is shared by Rodale Press, publisher of the Organic Gardening magazine and a booster of alternative energy sources.

Not all experts in the field agree with so dire an assessment, however. "The Japanese are probably not as far ahead as we think. We get a lot of press reports and rumors which are probably exaggerated," says one DOE official.

At the same time, there is a feeling that, while the devastation of the federal program will significantly slow the pace of development of photovoltaics in the US, the private PV industry is healthy enough to go it alone. Several years ago, the amount of private investment in PV surpassed federal spending here. The administration's rationale for the massive federal cutbacks is that private enterprise can do the job better.

There is at least an element of truth in this assessment. "I have been very pleased with the private sector response to the cutbacks. Several new corporations are getting in. It's still looking good from that point of view," reports Paul Maycock, who recently resigned as head of the DOE photovoltaics program.

Despite the cutbacks, Mr. Maycock foresees a very competitive world market, with the leadership alternating between the US, Japan, and, perhaps, other countries. "American firms currently have 90 percent world market while the Japanese have close to 0. This is considerable advantage to overcome," he points out.

"We have the technological edge. We should have more confidence in American enterprise," says the director of one large privately funded laboratory. However, he admits they have hedged their investment by entering into a joint venture with a Japanese company, something several large US firms involved in this technology have done.

Most of the heads of private PV efforts, while praising much of the federal program, feel that certain aspects, particularly those involving "commercialization," now can be gradually phased out. However, a number are not enthusiastic about the manner in which the current cutbacks are being made.

From what I hear through the grapevine, the cuts are not being made with enough selectivity," says one laboratory director. Too much basic research and development is being cut and too many commercialization programs are being redefined and kept, he objects. As a result, the reduction in what he considers the most useful and appropriate federal efforts are greater than he would like.

Until now, the US has been taking a low-risk approach to solar cell development. By funding research into a large number of approaches in parallel, when any give approach does not pan out, the overall rate of progress is not slowed substantially.

As result of the cutbacks, the range of federally funded research is being cut back radically. The result is greater risk of failure. If the cutbacks had come two years ago the goverment would have dropped work on amorphous silicon, the approach which now, because of an unexpected breakthrough, looks so promising that the Japanese have focused almost exclusively on it, points out one researcher.

In addition, as many as one-third of the researchers in the field are being forced to look for funding from private sources or turn to another area, experts say. Many, perhaps two-thirds of these, will be able to continue their work if they wish to.

However, research teams are being broken up and valuable experience splintered. Furthermore, uncertainty over the future will adversely affect those who continue to work on government grants.

"It's irritating to be in this country, working on a technology where overseas every one envies us our leadership but which your own government fails completely to recognize," observes Joseph Lindmayer, head of Solarex.

He objects to the manner in which the cutbacks have been made as much or more than their substance. "The cuts are too much, too fast. And, at the same time, administration is making negative statements about PV, and I have already lost one contract as a result," he complains.

He and a number of other photovaltaic entrepeneurs fear that this cutback will be viewed by US investors and by foreign nations as a vote of no confidence in the technology.