On Solyndra

Published at 13:16 on 16 September 2011

Yes, it does show that corporate handouts don’t stop at party lines.

And yes, it was a stupid investment. Solyndra’s business plan was fatally flawed: it depended on finding alternatives to silicon for photovoltaic cells, which they presumed was needed because the price of silicon was going up, which they presumed indicated a shortage. Anyone with a few functioning neurons in his or her brain should see the flaw here: silicon isn’t a scarce strategic material. 27% of the Earth’s crust is silicon. Quartz — the most common mineral in the crust — is high-grade silicon ore.

The shortage of silicon in its refined elemental state, therefore, was purely due to a manufacturing bottleneck, not any sort of a raw-materials scarcity. The output of silicon solar cells had gone way up, but the output of refined silicon had not, creating a shortage in the latter. Any resulting spike in prices was bound to be short-lived, however, as it would merely serve as an incentive to build more refineries and open more silica quarries. As indeed it was.

However, it’s also small potatoes as government fiascoes go. The Iraq War has wasted far, far more money. Not to mention lives (Solyndra killed nobody).

And no, it wasn’t a stupid investment because it was an alternative energy investment; it was a stupid investment because it contained a flawed premise about silicon.

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