Prodigal Sun

Solar energy was a rising star in the '70s -- until it was banished by the powers that be. Are we ready for its return?

It was the winter of 1981 and the country was just beginning to feel the sharp edges of the Reagan revolution. Denis Hayes, head of the fledgling Solar Energy Research Institute, was walking through the halls of the Department of Energy when an acquaintance came up to him and said, "Has Frank lowered the boom on you yet?" The Frank in question was an acting assistant secretary, but the boom, it turned out, was falling from the top. President Reagan had once been General Electric's most camera-ready tout, and his administration viewed alternative energy with open scorn. "They're going to kill your study," the gray-suited informant warned Hayes, before slipping down the corridor.

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The study, a yearlong investigation by some of the nation's leading scientists, provided a convincing blueprint for a solar future. It showed that alternative energy could easily meet 28 percent of the nation's power needs by 2000. The only thing that solar and wind and other nonpolluting energy sources needed was a push, the study concluded -- the same research funding and tax credits provided to other energy industries, and a government committed to lead the way to reduced reliance on fossil fuels. But the messenger in the corridor signaled that the solar future would only be won with a little guerrilla warfare. Hayes phoned a colleague at his office in Golden, Colorado, and told him to make 100 copies of the study and circulate them around the country. Energy Secretary Jim Edwards killed the study, all right, but not before it had been published in the Congressional Record.

It was a bold gesture, but not enough to alter the outcome. The quashed study proved to be the beginning of the end. The budget for the solar institute -- which President Jimmy Carter had created to spearhead solar innovation -- was slashed from $124 million in 1980 to $59 million in 1982. Scientists who had left tenured university jobs to work under Hayes were given two weeks notice and no severance pay. The squelching of the institute -- later partly re-funded and renamed the National Renewable Energy Laboratory -- marked the start of Reagan's campaign against solar power. By the end of 1985, when Congress and the administration allowed tax credits for solar homes to lapse, the dream of a solar era had faded. The solar water heater President Carter had installed on the White House roof in 1979 was dismantled and junked. Solar water heating went from a billion-dollar industry to peanuts overnight; thousands of sun-minded businesses went bankrupt. "It died. It's dead," says Peter Barnes, whose San Francisco solar- installation business had 35 employees at its peak. "First the money dried up, then the spirit dried up," says Jim Benson, another solar activist of the day.

Today solar and other renewable alternatives provide barely five percent of America's energy. The solar-powered present never arrived, postponed by opposition from big utility companies, government support that favored oil and nuclear, and unproven solar technology that left the entire concept of solar energy open to ridicule. The story of what happened to solar during that first, failed revolution is more than a footnote to forgotten history. It provides a primer for the current resurgence in alternative energy, an indication of what we can expect from solar power in the decades ahead. Although the solar panels came off the White House 14 years ago, the sun continues to shine, an obvious reminder of natural hope, bathing the earth in enough heat and light every hour to provide the world's energy needs for a year. It brightens the sulfuric haze above coal-fired power plants, splinters into psychedelic spectra in smoggy sunsets, reflects off the concrete cooling towers of Three Mile Island and Trojan. It powers highway signs and wristwatches and more than a million homes and offices and schools, fueling a worldwide industry that has grown from $150 million in 1990 to $1.2 billion in 1998.

This time around, alternative energy is being fueled by an unlikely coalition of Big Oil, green marketers, antimonopoly libertarians, and solar pioneers who survived the '70s. Energy deregulation has also revived hopes for cleaner, brighter power. In perhaps the most promising development, some individual homes and businesses with solar panels are now connecting directly to the existing power grid. By generating more electricity than they need and supplying the excess energy to utilities, homeowners can actually make their electric meters run backward. "In the 1970s everybody wanted to be off the grid," says Scott Sklar, executive director of the Solar Energy Industries Association in Arlington, Virginia. "It was part of the back-to-the-land thing. But it took a lot of money and energy to build these grids -- and we should use them."

The solar future first dawned in the fall of 1973 during the Yom Kippur War, when Arab states halted oil shipments to try to force the United States and Europe to withhold support for Israel. The 1973 and 1979 oil embargoes drove the price of a barrel of crude oil from less than $4 in 1970 to more than $22 a decade later. The crisis created an awareness of U.S. dependence on foreign oil, spurring research into alternatives. Although nuclear power received the most funding, hopes that cleaner sources of energy would power the future made the 1970s a good time to be technically adept and politically engaged in Washington. A corner of government opened itself to young idealists.

The solar pioneers of the '70s were a mixed lot -- anti-war activists with technical training, counterculture farmers, computer nerds with a conscience. Jim Benson, a University of Missouri geology graduate, arrived in Washington in 1972 to work on computers for a mortgage company. "It was the beginning of the winding down of the Vietnam War and the winding up of Watergate, and it was a fascinating time to arrive from the provinces," he recalls. "My next-door neighbors were CIA agents. They could see I was confused so they gave me The Limits to Growth. That's really what got me interested in solar energy." Benson studied urban planning and joined the solar division of the Energy and Resources Development Agency (ERDA), which later became the Department of Energy.

In those days, no one even knew with any precision how much sunlight struck different parts of the country. "The first thing we did was set up a network of solar monitors," recalls Benson. He also helped create a small-grants program for energy conservation technology, which attracted more than 20,000 applications a year at its peak before the Reagan administration did away with it. Some of the proposals were funded, but most were ignored or sent back. "Not just skimpy ill-defined ideas were rejected," wrote Texas journalist Ray Reece in his 1979 account, The Sun Betrayed, "but proposals for innovations so simple and yet so brilliant in concept as to be virtually fail-safe, effective, economical." Most of the initial research money went to large universities and corporations like General Electric, which was awarded $2.8 million, and Martin Marietta, which received $3.5 million. By the late 1970s, Exxon, Mobil, Arco, and other oil companies had bought out many patents for the photovoltaic cells that collect sunlight and convert it to electricity, prompting consumer watchdogs like Ralph Nader to sound the alarm that companies with vested interests in "hard" energy were in position to smother "soft" innovations.

An investigation by the Center for Renewable Resources, an environmental advocacy group, found no evidence of a systematic oil industry effort to suppress solar power, but those involved in the alternative energy movement knew the energy industry was worried about the sun's potential. Larry Shirley, an activist with the center who now heads a solar research institute at North Carolina State University, remembers speaking with the CEO of a major utility. "He told me that photovoltaics were going to be the wave of the future," Shirley recalls. "He looked out his window and said he could imagine the power lines coming down." Then the utility executive turned to face Shirley. "Larry," he said, "why shouldn't I feel threatened by them right now?"

Even after the oil crisis, most federal research targeted nonrenewable energy sources. According to a recent analysis by the Congressional Research Service, 77 cents of every energy research dollar from 1973 to 1997 went to nuclear and fossil fuels. Only 14 cents went to alternative energy, and the remaining 9 cents supported energy conservation. The results show just how skewed spending priorities have been. Every nuclear plant ordered since 1974 has been canceled, and consumers will be stuck with at least $112 billion in "stranded costs" -- money utilities have sunk into nukes and other failed investments. Over the same period, by contrast, the efficiency of solar photovoltaic cells has leaped fivefold.

The last thing Jim Benson did at ERDA was to commission a study of the environmental impact of solar energy versus coal, nuclear, and other sources. When Benson's bosses got wind of the study's pro-solar conclusions, they tried to kill it. But just as Hayes would do some years later at DOE, Benson skirted protocol to get his message out. He sent out copies to reporters and activists. His bosses were not pleased. "I was accused of skewing the results to favor solar energy and conservation," recalls Benson, "but actions speak louder than words. Where is synthetic fuel today? Where is nuclear energy? They weren't clean or cost-effective. But look at solar."

Jimmy Carter's narrow victory in the 1976 presidential election warmed solar hopes. Before the inauguration, Benson, Hayes, alternative-energy guru Amory Lovins, and others were invited to a retreat in Georgia where they drew up the Wolf Creek Statement, a document that helped shape the new administration's energy plan. Politi- cally speaking, Sun Day -- May 3, 1978 -- was the peak of support for solar energy in the United States. U.N. representative Andrew Young took part in a sunrise ceremony on the East River in New York. Jimmy Carter, at a rainy Colorado rally, announced new tax incentives and solar research programs; Rosalynn Carter donned a Sun Day T-shirt at a press conference with Denis Hayes, the event's leading organizer. In subsequent years, the Carter administration haltingly introduced legislation that helped create a fledgling solar industry, its most visible arm being rooftop solar water heaters.

Then came Reagan. "If Jimmy Carter had been reelected president, we would now have a quarter or so of the nation's energy resources coming from renewables," Hayes says. "It was a clear, calculated campaign by the DOE in the years of the Reagan administration to crush the solar energy program of the federal government, driving many of the most talented people out of the field."

Not all the solar veterans share Hayes' perspective. To be sure, there were vested interests, but as a clunky, expensive, and often inefficient technology, solar sometimes left itself open to derision. The powerful symbolism of placing solar panels atop the White House was offset, for example, by the solar-heated reviewing stand Carter ordered for his inaugural parade. It didn't heat very well. "So much for solar energy," Vice President Walter Mondale was heard to mutter as he left the ceremony, blowing into his chapped hands. In California, rip-off artists built leaky solar water heaters, abusing the mellow idealism of their trade to bilk thousands of modest homeowners. And even some of the model solar-heated buildings created in the utopian spirit of the day haven't panned out.

"The glass panels would break and we'd have water dripping onto the sidewalk and need jackhammers to break up the ice," says Linda Groo, registrar at Terraset Elementary School in Reston, Virginia. The earth-insulated school, built in 1977 as a gift from the government of Saudi Arabia, was intended to show the desert kingdom's commitment to human progress at a time when Americans were vilifying Arabs as greedy oil sheikhs. But some classrooms were too hot and others were too cold, and the kids threw rocks at the solar panels. It was new technology and it had bugs. "We tore it out about 12 years ago," Groo says. "It really didn't work out so well."

Others think that solar tax credits were mishandled. In 1983, a homeowner could pay $5,000 to have a solar water heater installed in Virginia and get more than $3,000 of that back in state and federal tax credits. The prospect of a quick buck drew companies to the solar industry that had no commitment to the technology. "We had three crews putting up 10 or 11 systems every week in 1984," says Al Rich, then a district manager for American Solar King, which marketed its installed heating systems through Sears. The federal credits disappeared on December 31, 1985, and so did American Solar King. Rich was reduced to peddling solar heating systems out of his home. "In this business," Rich says with the resignation of a bruised but still faithful devotee of solar power, "you get used to a lot of ups and downs."

Solar, of course, isn't the only industry to receive tax support. The oil industry has enjoyed billions in breaks in the form of depletion allowances, and utilities have received billions in subsidies for nuclear development from taxpayers and consumers. If solar tax credits had been phased out slowly, instead of disappearing overnight, the technology would have gotten better faster. And implementing stronger incentives today could feed demand, creating economies of scale in solar production that would boost its viability. "Increased volume has brought down the price of photovoltaics, but the curve is flattening out," says J. Michael Davis, president of Kyocera Solar Inc., a PV distributor in Scottsdale, Arizona. "To cut the price in half again is going to take a hell of a lot more volume."

Even without the support enjoyed by nuclear and fossil fuels, the promise of solar power has continued to grow. On a recent afternoon, the sun was shining on an array of black panels on the roof of BJ's Wholesale Club, located off Interstate 476 outside Philadelphia -- a most unlikely place for solar energy's renaissance, but as good an example as any of the likely shape of solar to come.

The 1,400 tiny panels atop BJ's were built by BP Solarex, a subsidiary purchased for $45 million last April by oil giant BP Amoco. Its chief executive, Sir John Browne, plans a sixfold increase in Solarex's revenues from photovoltaics by 2007. The panels atop BJ's send electricity directly into the existing power grid, thanks to utility deregulation in Pennsylvania that allows consumers to switch from their traditional utility to an independent energy provider. One of those providers, a Vermont firm called GreenMountain.com, now sells power from BJ's and other alternative sources to 100,000 customers -- all via the transmission lines owned by traditional utilities. In essence, the roof of the store has become a miniature solar-power plant, supplying enough energy through existing electric lines to light and cool a dozen homes.

Such rooftop generators signal a potential transformation of the power industry, one that industry observers say is likely to be implemented by nearly every state in the nation in the coming decade. To ensure that homes and businesses can connect their solar collectors directly to the grid, activists are leading a campaign that has already convinced 30 states to force utilities to purchase solar power fed into the grid at the same prices they charge consumers. Solar advocates hope that utilities, faced with competition from new, more agile power companies, will have an economic incentive to avoid costly new investments in coal-fired and nuclear plants. In short, the market itself could favor the creation of numerous small power stations -- including rooftop solar panels -- distributed around the grid.

Thanks in part to technical innovations, the price of converting solar energy to electricity has been cut in half over the past decade, making it economical in many areas. Some municipal utilities are starting to invest in solar: The city-owned utility in Los Angeles has pledged to help install 100,000 solar systems, while SMUD, the Sacramento-area utility, has provided financial incentives for hundreds of solar homes in recent years. The excess power from these tiny generating plants will save SMUD money by reducing its need to buy power from other utilities during peak hours.

Despite the potential of solar energy, the Clinton administration has expended little money on research and little political capital on securing new federal tax incentives. Industry officials say Clinton's predecessor, oilman George Bush, funded solar programs more consistently. In 1997, however, the Clinton administration did launch the Million Solar Roofs Initiative, an underfunded but ambitious plan to facilitate solar construction by bringing together architects, school builders, solar companies, and others into partnerships. So far the program has garnered commitments to build solar power into 910,000 separate structures -- BJ's warehouse in Pennsylvania among them.

Solar will receive another boost, its backers hope, from moves by designers to incorporate arrays of solar cells directly into building materials like windows, house tiles, and shingles. A visit to the BP Solarex factory in Toano, Virginia, gives a sense of the potential. Set amid pine trees off a state highway, the factory produces 4-foot by 2-foot solar panels of glass coated with a thin film of semiconductor material that converts sunlight into electricity. The panels resemble the facings of typical office buildings -- and the factory plans to customize the film coating depending on how opaque the architect wants the glass to be. Combining solar technology and building materials cuts construction costs, making the panels more attractive to builders. "Our goal for 2007 is to produce 53 percent of our panels for incorporation as building material," says Scott Albertson, a BP Solarex vice president.

Yet dozens of obstacles to a solar future remain. The most obvious is the difficulty of plugging solar homes and businesses into the electrical grid. Although many states now require utilities to pay fair-market prices to customers who produce excess energy, some utilities have resisted by forcing consumers to sign 400-page liability agreements. What's more, there's no simple standard that would allow, say, a woman moving from Massachusetts to receive reimbursement for plugging her solar panel into the grid at her new home in California. The utility red tape has inspired a defiant group of fly-by-night electricians to connect solar homes directly to utility meters -- their guerrilla raids chronicled by the Oregon magazine Home Power.

Even if the legal hurdles are crossed, there's still the problem of educating all those architects and utility managers and electricians and contractors about the alternatives so they can start using them. "One of the things I didn't understand in the '70s," says Scott Sklar of the solar energy association, "is that things that look good in the lab and even in manufacturing don't necessarily find a pathway to the consumer."

Energy generated by photovoltaic modules remains more expensive than the average cost of utility power, but experts at the National Renewable Energy Laboratory predict that PV costs will fall eightfold by 2020. Solar is already cheaper than peak-use electricity in many areas. It's also cheaper than running new lines to isolated spots, which explains why 85 percent of all U.S. photovoltaics are exported -- mostly to the Third World, where an estimated two billion people lack electricity. "Frankly, democratization is a driver for us," says Sklar. "What's the first thing democratic governments do to enfranchise the poor in the Third World? Electrify their villages." The government of Indonesia, for example, has installed more than 36,000 rural solar systems, 50-watt housetop modules that power batteries and lights in remote areas years away from being connected to a grid.

Closer to home, though, some advocates say solar has lost much of the democratic appeal that encouraged so many to promote it as a decentralized alternative to big energy conglomerates. Multinationals like BP Amoco produce most of the photovoltaic power, and utilities have yet to see the light. "Today, the resurgence of solar technologies is strictly managed by the same energy corporations who undermined solar hot-water heating in the 1970s and 1980s," write Daniel Berman and John O'Connor in their recent book, Who Owns the Sun? "Solar power without a grassroots solar movement will be merely another form of business as usual."

That prospect doesn't bother everyone. "So I have to buy my PV from British Petroleum," says Peter Barnes, the former California contractor who went on to found Working Assets. "It doesn't matter who makes it. Let's face it, total energy independence is a myth. Most of us need to rely on the grid -- if only on cloudy days."

Denis Hayes, who organized the first Earth Day back in 1970, is leading a monthlong celebration culminating on April 22 to mark the event's 30th anniversary. As he sees it, the potential for solar power has never been greater. Climate change increasingly demonstrates the need to reduce dependency on fossil fuels, and alternative technologies are much further along than they were in the 1970s. But the public will have to get involved -- not only as consumers demanding cleaner energy, Hayes says, but also as activists and voters seeking government leadership for solar and other alternatives. Little will change, he adds, without the spirit of idealism so present during the first solar revolution. "There was a higher degree of confidence in government then, less estrangement," Hayes says. "Maybe that's what we're trying to do with this Earth Day -- to keep hope alive."