Mr. Chairman, thank you for this opportunity to discuss important issues
related to the nation's energy policies to meet our energy demands for
the future. I am the director of the National Renewable Energy
Laboratory (NREL) in Golden, Colorado. NREL is the U.S. Department of
Energy's primary laboratory for research and development of renewable
energy and energy efficiency technologies. I am honored to be here, and
to speak with you today.

We applaud the Committee for its continuing examination of solar and
other sources of renewable electricity and fuels. If we are to ensure
the nation receives the full range of benefits that renewable energy
technologies can provide, we will need a carefully balanced blend of new
technology, market acceptance and government policies. It is not a
question of whether to rely solely on the market, or on new research, or
on government action, as we work to solve our energy problems. To
accelerate deployment of renewable energy technologies, we need to
effectively combine all three.

DOE's Solar Energy Program sponsors research, development, and
deployment of solar energy technologies and systems that can help meet
our nation's electricity needs and reduce stress on our electricity
infrastructure. The Solar Program supports research in at NREL and other
institutions in photovoltaics (PV), concentrating solar power (CSP), and
solar heating and lighting.

Through the President's Solar America Initiative the national goal is to
reduce the cost of solar photovoltaic technologies so that they become
cost-competitive with other sources of electricity in all major U.S.
markets by 2015.

Recent developments in the western United States illustrate the growing
concern over greenhouse gas emissions, and consequently, a market
climate that is open to further deployment of **concentrating solar
power** (CSP) in that region of the country.

Solar energy is the southwest's most abundant renewable resource. In
fact, California, Arizona, and New Mexico have enough combined solar
energy to provide all the power needed by the entire country. At a time
when large quantities of carbon-free power will be needed, CSP power
plants can be quickly constructed and brought on line.

In the U.S., nine CSP power plants totaling 354 MW have been operating
reliably in California for over 16 years, and CSP seems poised to grow
significantly in the state.

As with all new energy technologies, cost is an issue. But CSP has an
additional challenge: the technology requires scale to achieve its
ultimate cost effectiveness. Couple the scale issue with high up-front
capital costs and the investment risk is too large for current market
conditions.

The Solar Program addressed the cost issue by commissioning a detailed
technical analysis of CSP by an independent engineering firm and then
having the analysis reviewed by the National Research Council. The
analysis estimated that the cost of CSP technology can be significantly
reduced from 12-14 cents/kWh (as of 2003) and predicts ultimate costs
for CSP troughs at 6.2 cents/kWh and power towers at 5.5 cents/kWh.,
well within the uncertainty range of Sandia and NREL projections and who
now predict costs could be even lower.

The Discussion Draft language on thermal energy storage addresses an
important issue related to the intermittent nature of solar energy and
its impact on utilities.

The potential for low-cost and efficient thermal storage is one of the
key long-term attributes of large-scale CSP technologies. The ability of
CSP technologies to store energy presents an opportunity for DOE and
NREL to establish an R&D effort that focuses on a solar technology that
can produce baseload power at about 5 cents/kWh. Such systems would
include 13-17 hrs of thermal storage and would compete with the cost of
power from coal plants using carbon sequestration technology. It is
expected that an aggressive R&D program could achieve the cost goal by
2020.

The Discussion Draft also addresses transmission integration, an
important issue for CSP plants. CSP works best where the sun is most
intense and there are few cloudy days, so plants are often located in
desert or semi-arid locations where few people live. Transmission lines
are required to bring the power from these remote locations to urban
load centers. Throughout the West, access to transmission is generally
limited because many lines currently operate at or near capacity. While
transmission is a problem for all new power generation, it is
particularly difficult for solar because solar power plants need to be
located where the solar resource is best and these are not always near
existing transmission lines.

Addition transmission lines could allow solar energy from the Southwest
to provide up to 6,800 GW of electricity to the U.S.

Utilities have indicated that even with storage and the other advantages
mentioned above, it is hard for them to justify purchasing CSP power
above 10 cents/kWh when they can buy less expensive wind power. The
federal investment tax credit is important because it does much to
bridge the cost gap.

So early market penetration of CSP could be driven by a long-term
extension of the 30% investment tax credit for commercial solar
technologies. But if the cost of CSP power is too high when the tax
credit expires, the market will take a significant downturn or become
completely stagnant. An objective of the DOE and NREL CSP R&D activities
would be to decrease the cost of the technology in a timely enough
fashion so the market remains healthy when the tax credits expire.

**Photovoltaics R&D Strategy**

Prior to 2006, our research focused on technical progress through
increasing the conversion efficiencies of solar cells and reducing the
manufacturing costs of photovoltaic modules.

In 2006 we began to change program strategy, based in part on a fresh
look at the solar energy industry by the investment community, and
supportive policies from numerous state and local programs. The focus of
our research shifted from technical progress on components to integrated
PV systems.

Under the new strategy, companies funded by SAI are expected to develop
products for priority markets, and industry is expected to influence the
research agenda for the national laboratories and universities.

Perhaps the most dramatic evidence of this new strategy was DOE's
significant investment in a new funding opportunity for industry-led
Technology Pathway Partnerships.

Earlier this year, 12 Technology Pathway Partnership projects were
selected to receive up to \$168 million in DOE funding over the next
three years, with the awardees contributing over 50 percent of the
funding for these projects.

This new portfolio continues our historical investment in thin films and
increases support significantly for concentrator photovoltaics and
crystalline silicon technologies.

The Solar Energy Research Institute (SERI), now NREL, was originally
created to develop the technologies needed to foster a dynamic solar
industry. Our Laboratory has succeeded in large part at fulfilling this
charter and has been vital to the development of the PV industry.

In early 2007 we began to reexamine our research strategy to ensure that
it will be complementary and relevant in years to come.

We began formulating a new multi-year research plan that recognizes this
changing market context and the strategy is being developed with input
from industry and academic collaborators. This planning process is
intended to ensure the long-term vitality of NREL's research and its
mission to help foster and sustain a strong American industry.

Upon realizing the SAI goal, it is expected that roughly 2 million
metric tons per year of carbon emissions will be avoided by 2015 and PV
will provide approximately 5 GW of electricity generating capacity --
displacing roughly the equivalent of 5 coal-fired power plants -- enough
to energy to power about 1.25 million households. This is equivalent to
10 times the amount of PV installed today.[^1]

**Distributed solar technologies** will enable our ultimate goal of
affordable zero energy homes and buildings which fulfills the
President's Advanced Energy Initiative vision of changing the way we
power our homes and businesses. Net-zero energy homes and buildings
produce as much energy as they consume through improved efficiency
combined with renewable energy, such as solar, providing needed power
and offsetting any utility-provided energy over the course of a year.

As the Committee's Discussion Draft notes, educating energy consumers is
critical to achieving the market goals I have previously indicated. One
of the ways we educate Americans about the new choices they have in
heating, cooling and powering their buildings is a unique project that
encourages the development of zero energy homes called the Solar
Decathlon.

The Decathlon, sponsored by DOE, challenges schools of architecture and
engineering to design solar powered, zero-carbon, self-sustaining houses
from the ground up to see which house is the most aesthetically pleasing
and which house performs the best. Twenty collegiate teams from the
United States, Canada, Puerto Rico, Spain, and Germany will participate
in this year's competition, which will be held on the National Mall from
October 12-20, 2007.

**Summary:**

To address our near term needs in solar power we need a national
strategy that promotes the deployment of solar systems and processes
that are ready to serve us today. At the same time, to address our
longer term needs and achieve a truly significant contribution from
solar power technologies, we must make a major new commitment to the
research required to deliver the next, and subsequent, generations of
CSP, PV and other new technologies.

The good news is that the United States can take back the global
leadership it once had in the solar energy field -- what is likely to be
one of the most important new industries of this century -- through
investing wisely now and into the future. The timing is fortuitous,
because by most accounts the next big market for global renewable energy
in here in the United States.

Thank you.

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