Dim solar energy market leads to local job cuts in Springettsbury Township
Oct 17 - McClatchy-Tribune Regional News - Sean Adkins York Daily Record, Pa.
A downturn in the global solar energy market has forced one local company to cut back on its workforce.
Earlier this month, Komax Solar Inc. in Springettsbury Township let go of 33 production, management and engineering workers, said Brian Micciche, president of the company.
Left with a staff of 60, Komax Solar makes machines that are used to make solar energy panels.
"The cutback was in response to the relatively flat production of solar panels," Micciche said. "Since there is an over supply of panel production right now, panel producers are not expanding and are not buying as many machines. This phenomenon is affecting all equipment companies."
For the past several years, many solar energy companies have ramped up production to keep up with demand.
However, as demand has slowed, so has the need for equipment, such as solar panels.
"The panel producers have more than they need," Micciche said.
As a result, the cost for panels have fallen, he said.
Why has the demand for solar energy become flat?
In Pennsylvania, a drained rebate program has contributed to slower sales.
In 2004, the state started to require that, once a utility's rate cap expired, it had to buy a certain amount of solar energy credits each year, said Ron Celentano, a solar energy consultant.
Celentano is president of the Pennsylvania Solar Energy Industries Association.
Basically, a resident or a business with a solar energy system would sell their credits to an aggregator who, in turn, would eventually sell the credits to a utility.
That utility would meet its requirement from the state and the person or business would receive a check.
To make solar energy even more attractive, the state introduced a rebate program with a $100 million budget, Celentano said.
"Solar installers were just packed with jobs and equipment," he said. "Demand was strong."
Now, with nearly all that money accounted for in projects and other expenses, solar installations have slowed, Celentano said.
In addition, as more people and business turned to solar, utilities had little trouble meeting their renewable energy requirements.
"The oversupply of systems contributed to the drop in value of those credits," Celentano said.
Going forward, the number of panel manufacturers is expected to drop, as well as the overall cost for solar energy systems, Micciche said.
For now, Komax will focus on new product development.
"So, when the market does come back, we will have the products it needs," Micciche said.