Google is doing some spring cleaning and booted seven projects that were outside what they regard as their core business, the most high-profile of which was its attempt to make solar energy cheaper than coal.

It was a grand effort and Google is a smart company but solar is simply too inefficient in its current state.  The Department of Energy has a huge chunk of its $36 billion 'venture capital' efforts riding on current solar energy companies but they did it in a rush - a plan that had been in effect since 2005 but with no companies passing muster suddenly was handing money to every company from 2009-2011, so in a world of crystalline solar panels they have been endorsing expensive copper indium gallium selenide (CIGS) technology and the result is political theater and a lot of people asking why the Department of Energy is claiming it knows more than venture capitalists about investing and then rationalizing bad investments weren't wrong because venture capitalists were also in those companies. Unless we get rid of the EPA and force people to work for $5,000 a year, solar technology is going to be cheaper in China so let them manufacture them and incur the subsidies to make them cheap enough to buy here.

The rationale behind subsidizing domestic manufacturing only makes sense to people with no business experience, which unfortunately includes Energy Secretary and Nobel Laureate Steven Chu.  He is trying to imply we are in a race with China to build as many solar panels as possible but it's hard to figure out why he believes that; it's like saying we are in a race with China to build 2002-era PCs.  We're not putting in an infrastructure for the future and we're not getting better at building future PCs by building and relying on old ones and so it goes with solar. Chu was hired for his research credibility, not his business acumen, so forcing him into a role he is ill-suited for is bad for everyone.

Google recognizes the weaknesses in current solar technology and its "Green Energy Czar", Bill Weihl, left earlier this month. 

There is a lesson in here; alternative energy is clearly the future but subsidizing companies now will not lead to a better future, it will make current companies reliant on legacy technology and government funding.  Even the staunchest progressives inside DoE recognize that oil companies are resistant to green energy because current energy is how they make their money, yet they seem to think creating new companies reliant on government funding will be different.  It's ethanol all over again; only now that he is out of politics does Al Gore concede his support for ethanol was political and not science-based, the opposite of what he claimed at the time.

We'd be better off if the Obama administration changed course and abandoned the corporate welfare plan and instead focused exclusively on funding research that could have a legitimate breakthrough - yet insiders at DoE, who ordinarily would be fans of research, seem fixated on Keynesian economics for green tech.  Alternative energy is the future and some sharp  investigator can find it but the way to find that person is to fund as much basic research as possible and not fund private companies for $500,000 per employee.

Google quits plans to make cheap renewable energy By Alexei Oreskovic, Reuters