By Richard Martin, Contributing Editor

It’s been a big few weeks for the solar industry in Colorado. Weeks after signing a major deal to supply photovoltaic (PV) modules to TurtleEnergy LLC – a contract that could bring in $150 million over the next several years – Thornton-based Ascent Solar issued 6 million shares in new stock, planning on raising $36 million. And another solar manufacturer, E2Logicx, held a kickoff celebration for its planned solar manufacturing plant in Brush, near Fort Morgan. Solar technology remains a growth area in an economy staggering out of a historic recession.

A closer look, however, reveals some clouds on the horizon for solar. Despite the balloons and high-fives, the E2Logicx facility has a long road to becoming reality.

“The company is seeking $20 million in financing from various sources, including government grants and private lending groups,” CEN’s Solar Tracks reported, to build a 30,000 to 38,000 square-foot facility at Interstate 76 and Hospital Road.” What’s more, E2Logicx plans, like those of the broader solar industry in the Centennial State, could be set back by Xcel Energy, which has said it will scale back its Solar Rewards program – representing 90% of the solar business in Colorado – from 17 megawatts to 8 megawatts.

Despite the precipitous decline in the price of solar panels, the industry has not seen solar installations pick up in 2009, Jim Welch, CEO of Bella Energy and president of the Colorado Solar Industries Association, told The Denver Post. Welch expects 2010 to be better – but companies like Ascent are finding the road to profitability longer than expected. Ascent saw its share price drop 14% after its new stock offering, which was designed to raise funds to fill an operating deficit of some $34 million.

“Ascent is developing a product for which there still isn’t a market,” Daniel Englander, an analyst in San Francisco with market-research firm Greentech Media. “so they have to keep going until that market develops.”

Working toward a unique flexible, thin-film solar cell that could help revolutionize the industry, Ascent is trying to build a new $65 million factory in Thornton. Whether its technology will attract enough investors in a down market to bring the company’s vision to fruition is an open question.

Indeed, the formerly blazing solar industry has entered a phase of declining prices and flat orders that is leading many companies into what one analyst terms creative accounting. In a research note last week, Hapoalim Securities analyst Gordon Johnson remarked that solar companies may be resorting to “financial chicanery” to mask disappointing results (as reported on Barron’s Tech Trader Daily blog ). Among the deceptive accounting practices: showing cash flow from operations that is less than net income for multiple quarters (perpetrators include one-time stock market darlings First Solar and Suntech Power Holdings), overextending credit to customers who aren’t paying up, and valuing inventories too high even as the price of solar panels falls.

The passage of a climate bill, and a national renewable energy standard, could quickly turn around  the solar industry’s fortunes. And it’s not like Wall Street has totally soured on the solar sector, which, at 1% of the nation’s electricity supply, has a huge upside. “After two dismal weeks solar [made a]welcome rebound based on several likely reasons,” reported iStockAnalyst.com, including the drop in price for solar panels along with the rising cost of electricity. In fact, some solar stocks are actually undervalued, according to a blogger on the Seeking Alpha site: “Today we are seeing the real stuff on sale. It’s Brioni suits at Filene’s Basement or TJ Maxx. Truly the same, but much cheaper and in your size.”

What the ultimate size of the solar industry in Colorado, and the U.S., will be no one can say. There’s no question that the turnaround can’t come quickly enough for solar companies struggling through the industry’s lean times.