The second of a four-part series. Click here for part one.
LEXINGTON, Mass. -- Away from curious visitors' eyes, laboratory staff at a company called 1366 Technologies here are melting purified silicon in a furnace until it reaches the consistency of red-hot lava. Then they skim off wafers of silicon, the platforms for photovoltaic solar modules.
This may sound simple, but it isn't being done in China, in Germany or anywhere else, says 1366 CEO Frank van Mierlo, one of the Massachusetts Institute of Technology alumni and technology entrepreneurs behind the startup firm.
If it works at factory scale, 1366's process would go far toward making solar energy as cheap as coal power in this decade, he says.
Or it may not work, as van Mierlo acknowledges, although all results so far are on track. "It is really hard. It is not a zero-risk venture. We still have a steep hill to climb," he said.
The firm's project is a case study in the Energy Department's search for game-changing technologies to reduce carbon emissions from power plants and motor vehicles.
DOE's Advanced Research Projects Agency-Energy (ARPA-E) gave 1366 a $4 million grant in November 2009, the only grant to a solar firm in ARPA-E's initial awards. The grant raises a seminal question: How far and how fast can a government agency push commercial innovation?
Energy Secretary Steven Chu dropped by 1366 one afternoon in November, donning a face shield for protection from the glowing silicon furnace. He praised the firm's leaders as examples of "the innovative brilliance of Americans" who can not only compete for leadership in advanced energy technologies "but prevail convincingly," he said.
DOE has set an ambitious, if not audacious, goal of driving the price of installed residential and commercial photovoltaic solar power modules down to $1 per watt, compared to about $3.50 for utility-scale projects, and more than $5 for commercial and residential installations.
"With business-as-usual, by 2016, it will get to $2.20 a watt, and so we need a significant change to get to $1 a watt," said Arun Majumdar, whom Chu recruited from the University of California, Berkeley, and Lawrence Berkeley National Laboratory to run ARPA-E. Hitting $1 a watt would make the United States the global leader, he said.
DOE research grants seek scientific breakthroughs, while loan guarantees underwrite the expansion of solar unit manufacturing with today's technologies. Adding to these are federal subsidies and tax credits and state solar power targets. DOE research and development spending on solar research in fiscal 2010 exceeds $400 million.
Congress has approved the loan guarantees and incentives, and passed the American Recovery and Reinvestment Act, which made $117 million available for additional solar research. The Obama administration's initiatives aim higher, seeking to not only develop new energy technologies, but bring about their commercial success, generating jobs and U.S. leadership in clean energy technologies for the future, according to the president.
But the administration's goals have become another issue that divides congressional Democrats and Republicans. The DOE science and energy programs were funded by the lame-duck House on Dec. 21, with 212 Democrats and 16 Republicans voting in favor, and 130 Republicans voting no.
The price at which 'everything becomes possible'
If solar units could be installed for $1 per watt, the cost of solar energy would fall to 5 to 6 cents per kilowatt-hour, less than half the current average retail price in much of the country, according to DOE.
The calculation leaves out major costs, such as expanding and strengthening the power grid to handle far more complex flows of electricity from millions of solar installations, and creating breakthroughs in energy storage technology to lengthen solar power's impact beyond the daylight hours and to deal with sudden drops in output when clouds arrive.