A Sunny Forecast

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Arrayed along the pipelines of Enron Oil & Gas in the American Southwest is a series of boxy monitors that transmit data about the flow of the company's precious fossil fuels. The telecommunications devices draw their power not from the fuels they monitor but from shiny panels that capture the energy of the sun. Are these solar-powered invaders of the oil patch the technological portents of a coming era? Or are they merely emblematic of the bit part solar has played thus far in the world's energy equation? No one knows for sure, but corporate investors, who have been wary for the past decade, are lining up to bet billions on the proposition that solar power will at last have its moment in the sun.

Few ventures have produced more noble failures than the quest to power civilization with renewable energy from geophysical forces -- the winds, the tides and, most of all, the sun's rays. "To date the history of solar has been the story of Tantalus: year after year the prize has remained, maddeningly, just beyond reach," noted a FORTUNE magazine story. It ended on a hopeful note: "The period of solar frustration is drawing to a close." Date of the story: September 1979. In fact, the period of solar frustration was just beginning.

The oil glut of the 1980s sapped any motivation to develop alternative energy sources. Solar moved to the fringes of public consciousness in the U.S. as the Reagan Administration eliminated most of the federal funding for research, and big oil companies dropped their development programs. Result: solar accounts for less than 0.5% of the power generated in the U.S. today, instead of the 2% to 5% envisioned in the late 1970s.

What then explains a renewed romance with renewable energy among governments and corporations, especially since oil remains relatively cheap? Shell International Petroleum in London, which forecast the oil shocks of the 1970s, predicts that renewable power, particularly solar, will dominate world energy production by 2050. Japan's electronics giant Canon has formed a joint venture with Michigan's Energy Conversion Devices to commercialize solar technology. Enron, Germany's Siemens and scores of other companies, including aerospace firms, engineering giants and utilities, are also exploring opportunities to plug into the renewable-energy business. Is this collective corporate madness? Perhaps not. The world has changed a great deal since 1979.

Pollution, like the recent oil spill in Russia, and the threat of global climate change have rudely reminded nations that fossil fuels carry with them heavy costs even when the purchase price is low. In the developing world, alternative forms of energy enjoy increasing cachet as governments wonder how to provide power for billions of people who lack electricity, knowing full / well that cities such as New Delhi, Beijing and Mexico City are choking under blankets of smog. Most important of all: renewables are beginning to earn respect in the marketplace. During the past decade, improvements in technology and manufacturing have sharply increased the cost-effectiveness and reliability of solar-power systems.