Silicon Valley start-ups dreamed of transforming the economics of solar power by reinventing the technology used to make solar panels and deeply cutting the cost of production, attracting billions of dollars in venture capital investment.

But as the companies finally begin mass production, they are finding that the economics of the industry have already been transformed, by the Chinese. Chinese manufacturers, heavily subsidized by their own government and relying on vast economies of scale, have helped send the price of conventional solar panels plunging and grabbed market share far more quickly than anyone anticipated.

As a result, the California companies are scrambling to retool their strategies and find niches in which they can thrive.