Must solar innovation and manufacturing take place in the same region? That was a question posed by a moderator at a clean power conference this week and one that is topical at a time when several manufacturers have shuttered or curtailed production in the United States.

“When you look at deployment globally, is it bad to have an innovation and deployment decoupled?” asked Ira Ehrenpreis, general partner of Technology Partners, to his panel during the Renewable Energy Finance Forum in San Francisco this week. “The semiconductor industry does, and that doesn’t seem to bother anybody. The innovation is here and the manufacturing is elsewhere.”

The bankruptcies of Solyndra, SpectraWatt and Evergreen Solar in the last two months were a chilling reminder of the difficulties of building a long-lasting manufacturing business. Their demise doesn’t denounce the idea of creating a booming manufacturing base in the United States (Evergreen had been moving its production to China). But it forces the industry to think hard about the risks involved, particularly when Asian manufactures have risen to prominence and have done so quickly.

The comparison with the semiconductor industry is apt if only because solar PV manufacturing, which shares the use of certain basic materials, has attracted veterans from the semiconductor business. But the history of the semiconductor industry also offers some lessons for solar. American semiconductor companies used to produce chips domestically, but they ceded that to Taiwan and then China when building factories at home became too expensive. Startup chip companies today focus on engineering innovative chip designs, and they hire manufacturers in Asia to make the products.

One member of the panel, Neil Auerbach, who is the managing director of Hudson Clean Energy Partners, noted manufacturing discussions shouldn’t be simply about the locations of the factories.

“If you walk the factory floor of the Chinese manufacturing plants in China, most of the equipment is German, American, Italian and Swiss. Where manufacturing is taking place is deceiving. The majority of tools are developed in areas of high cost of labor but very skilled people,” Auerbach said.

Indeed, the United States is still a solar manufacturing power house, just not in the production of products that they can brand and market to consumers. The country exported $5.63 billion of solar goods in 2010 and imported $3.75 billion in 2010, according to a GTM Research report. The top two products were silicon and factory equipment. The United States actually exported more to China than what it imported from there last year. China uses the equipment and material to make solar cells and panels, which it then ships to the rest of the world.

How long the United States can remain a leader in these segments is hard to say. China and Korea are home to a good number of silicon producers as well, and they have been expanding their prodcution capacities in recent years. Nexolon, a Kroea-based silicon ingot and wafer maker, plans to go public next week to raise money for factory expansion.

The emerging crop of American solar manufactures is making a variety of goods, from silicon to solar panels. Many of them have developed cells and modules using alternatives to silicon, and they are trying to build factories to mass produce their products when the economy is weak and the global solar market is beset by declining government incentives in Europe and demand is outstripping supply.

Manufacturers’ primary consideration for setting up factories is to build a long-lasting business, not to create jobs. When money for building factories became difficult to find in the past few years, many turned to the government for help. The government wants to help the emerging industry, but its primary goal is to create jobs and that means building factories within the country.

What the manufacturers and the government want aren’t necessarily mutually exclusive but the solar industry needs a success story. Some companies, such as SoloPower, Abound Solar and 1366 Technologies, have secured federal loan guarantees over the past 12 months to build factories.

Some companies have turned to state incentive packages and investors who also are in the manufacturing business. Stion just opened a factory in Mississippi to make solar panels using copper-indium-gallium-selenide cells. One of Stion’s investors is Taiwan Semiconductor Manufacturing Co., which is the largest semiconductor contract manufacturer in the world. Calisolar, which purifies lower-grade silicon to make it suitable for solar cell production, is planning a factory in Mississippi with a $75.25 million package from the state.

And sometimes, it just makes more sense to build factories elsewhere. HelioVolt, a CIGS thin film maker, recently lined up $50 million from Korean conglomerate SK Group and is planning to build a factory in Asia, likely in Korea, reported VentureWire.