Solyndra files Chapter 11

The high-flying California solar technology company augers in.  Can’t see how they will resume operations given the economics and technology are moving strongly against them. 

Solyndra Suspends Operations to Evaluate Reorganization Options FREMONT, Calif., August 31, 2011 – Solyndra LLC, the American manufacturer of innovative cylindrical solar systems for commercial rooftops today announced that global economic and solar industry market conditions have forced the Company to suspend its manufacturing operations. Solyndra intends to file a petition for relief under Chapter 11 of the U.S. Bankruptcy Code while it evaluates options, including a sale of the business and licensing of its advanced CIGS technology and manufacturing expertise. As a result of the suspension of operations approximately 1,100 full-time and temporary employees are being laid off effective immediately. Despite strong growth in the first half of 2011 and traction in North America with a number of orders for very large commercial rooftops, Solyndra could not achieve full-scale operations rapidly enough to compete in the near term with the resources of larger foreign manufacturers. This competitive challenge was exacerbated by a global oversupply of solar panels and a severe compression of prices that in part resulted from uncertainty in governmental incentive programs in Europe and the decline in credit markets that finance solar systems. “We are incredibly proud of our employees, and we would like to thank our investors, channel partners, customers and suppliers, for the years of support that allowed us to bring our innovative technology to market. Distributed rooftop solar power makes sense, and our customers clearly recognize the advantages of Solyndra systems,” said Solyndra’s president and CEO, Brian Harrison. “Regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion. Raising incremental capital in this environment was not possible. This was an unexpected outcome and is most unfortunate.” Customers who have implemented Solyndra solutions can be assured that their systems will generate economical, clean, solar power for decades.

There are some lessons to be learned here.  I think it pretty obvious given what has been documented (failure to raise more money, Chinese competition cutting prices on competitive offerings, local PV competitors) of what went against Solyndra as a company and as an investment.   Some, but not all reasons, are included in the statements above by CEO Harrison. 

But it is too soon to draw larger lessons from this.  This is not likely a harbinger for green investment; a repudiation of the government’s policies and role in financing clean tech; or, that Solyndra’s demise is an indicator that the future of  green technology in the US is dimming.  We will learn much from why this notorious company went off the rails so rapidly.  But that will require a post-mortem which will undoubtedly come long after the pundits and commenters have had their brief chance to explain it or spin it.

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