A green loss here is a win for China

Even if well spent, state aid and current federal tax incentives for solar manufacturing are dwarfed by manufacturing subsidies and cheap labor abroad. American investment in clean energy in 2009 was only about half that of China, according to a Pew report. The United States only ranks 11th among the G-20 nations in clean energy investment as a percentage of gross domestic product. Spain leads the way on that score, followed by the United Kingdom, China, and Brazil.

Evergreen’s announcement this week that it will close its Devens plant came a day after Massachusetts Senator John Kerry lamented how China leapfrogged us to be the world’s largest solar manufacturer. “We invented the technology but China is reaping the rewards,’’ he said in a speech. Energy analyst Sam Dubinsky says that Evergreen’s struggles signal a “shake-out year for the industry, favoring low-cost producers in China.’’

In a telephone interview, analyst Christine Hersey of Wedbush Securities said that while Evergreen may have had unique, self-inflicted problems, the job cuts represent a universal dilemma. Any solutions must go far beyond protectionist tinkering, such as the federal “Buy American’’ provision enacted last week for military solar panel procurement, effectively banning Chinese-made panels. The measure’s sponsor, Representative Maurice Hinchey, a New York Democrat, said, “This is a common-sense approach to ensuring that American manufacturing jobs are supported.’’

That is just more feel-good rhetoric. The biggest US solar firms, like First Solar and SunPower, already outsource the bulk of their production to countries like Malaysia and the Philippines. Asian companies, fearing protectionism, are already dotting the United States with subsidiary plants. The bottom line, as the New York Times reported this week, is that China makes at least half of the world’s solar panels.

“While the military is a pretty decent buyer, it doesn’t drive market economics,’’ Hersey said. “I don’t think it is going to change the fact that the US is at a competitive disadvantage. Policy makers have to make major decisions not just about solar but manufacturing in general. Do you come up with a far more broad program of incentives, or do you want to accept the fact that components are going to be made elsewhere and you then focus on the `end market,’ such as installation? We don’t really have a policy in place.’’

The level to which we do not have an adequate policy in place is symbolized by a friend of mine who runs a solar contracting firm. Paul Lyons of Zapotec Energy in Cambridge told me, “When I can tell clients that a product is made in Massachusetts it is a source of pride, but at the end of the day, my job is to put in place as much solar energy as I can. That makes me indifferent to where the product comes from. I don’t support child labor or slave labor or anything like that, but the product has to be competitively priced.’’

Solar industry promoters optimistically say we’re up to 25,000 US solar manufacturing jobs and will add 9,000 more this year. Massachusetts clean energy advocates say general industry employment remains on a rapid rise. Still, the closing of Evergreen is a loss here and a win for China. Whether it involves more massive incentives here or a miraculous negotiation on subsidies abroad, if Obama and Patrick want solar jobs made here in the US of A and an industry that is truly evergreen, there is no time to lose.

Derrick Z. Jackson can be reached at jackson@globe.com.