There is a difference between the long run and the short run: we all know that and as John Maynard Keynes said, in the long run we are all dead. And probably in the long run we are going to have to go to sustainable energy production. But in the short run things don't look good.
The operating unit of a big Chinese producer of solar panels has just declared bankruptcy. Not only is it unusual for a Chinese company to do that--usually, The New York Times says, the Chinese government steps in with a bail-out in part to keep the reputation of Chinese business glowing.
This time, however, there are appears to be no other way out for Suntech, which is said to be losing $3 for every dollar in sales. The reasons are many: over expansion, increased production of natural gas in the US, and declining subsidies in the European Union for solar energy.
So where does that leave us? Without a Plan B, it seems to me. Our dependence on fossil fuel continues, and capitalism, even the state capitalism of the Chinese variety, isn't going to change thata very soon.
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What's behind the story is what is relevant. From my understanding, 'Western' solar panel manufacturers geared up years ago to take advantage of solar subsidies in Europe, and the States. They also sunk a fair bit of money into R&D. When Chinese manufacturers copied their technologies, and took over the lions share of the market, the solar subsidies were stopped. The chinese firms were left in the lurch, with no more hefty premiums for their products, and all that brand new plant and equipment to pay for. No point bailing out the manufacturers, because no western government is going to offer fat subsidies for Chinese firms to capitalise on.
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