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Record high oil prices,global warming, and increasing concern about energy independence and energy security have driven the growth of solar energy in the United States during the last decade. According to the Energy Information Administration, annual domestic shipments of photovoltaic cells and modules increased a remarkable 1,544.1 percent increase from 1997 to 2006, and employment in photovoltaic manufacturing increased 132 percent during the same period.

However, according to news reports in October, continued fast growth of the solar industry could be in jeopardy. With the United States and the world facing a recession, fewer investors are pumping money into the economy—the solar industry relies heavily on outside investments. “It has been a terrible time for the market as a whole and a worse time for the solar sector,” Peter Lynch wrote in an Oct. 27 article in InvestorIdeas.com. In addition, oil prices started to  fall back to less painful levels. We need only look back to the hard times that befell the solar industry in the 1970s shortly after the oil embargo ended to see what that could mean for the industry today.

Representatives from the solar industry seem more optimistic about the future of renewables. They say production expansion and increased government participation—the $700 billion Wall Street bailout provides huge earmarks for alternative energies—will drive growth for solar, despite economic hurdles.

During the Solar Power International expo, Oct. 13-16, exhibitors predicted major growth in the U.S. solar market. Dirk Vollbrecht, CFO of Ecostream US Inc., West Sacramento, Calif., said “the U.S. market will become the largest in the world in the next three years. Industry representatives at glasstec, Oct. 21-25 in Dusseldorf, Germany, shared similar predictions. “Photovoltaic is a booming industry, with a growth rate of 10 percent,” said Ingo Hagemann, architect and consultant, Hagemann Architects & BIPV Consultants, Germany. (See Page 10 of the December issue for glasstec coverage.)

If history has taught us anything, it’s that energy markets, particularly when it comes to renewables, can be a roller coaster. Whether the news reports or industry forecasts are right, the solar industry is in for a wild ride.