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Solar Power Is Booming — Why Do We Want To Kill It?
TaeKwonDood writes with a followup to the news we discussed over the weekend about tariffs being places on Chinese solar panels. He writes,
"According to Forbes, 'Solar power is booming. Imports from China were a tepid $21 million in 2005, but in 2011 installations totaled nearly $2.7 billion. That's a huge win. And just as advocates for solar power had hoped, a larger market drove down prices. Solar energy cost has declined by two-thirds in the last four years, meaning it will soon start to close in on fossil fuels.' There's just one problem: now the government wants to kill it. The article continues, 'As the market was flooded by both silicon (from silicon producers) and thin-film panels (by Chinese manufacturers), the price for thin-film panels came crashing down – along with Solyndra’s business model. ... Yet that isn’t the only instance of mismanagement. The whole clean energy program remains flawed, even at the consumer level. The people who are the most likely to be impacted by high energy prices, the poor, are the least likely to benefit from the solar rebate scheme because they lack the capital to pay for the installation.'"
While I'm not big of the idea of "the long tail" or "trickle down economics", I would think this would help the poor in a small manner. By those able to afford it having solar panels, the power companies have less demand for their energy and so the poor are less likely to see an increase in power prices (and, rarely, a slight reduction). This is, of course, assuming things like the able don't have their own, separate power station from the poor, enough able people install them to actually make some sort of dent, etc.
Even if they get no impact from it, "the poor still can't afford them" doesn't seem like a valid mark against such a program; I didn't see anyone complaining that the tax breaks to those who bought hybrids were bad because the poor still couldn't afford hybrids.
To the government that the US can no longer sustain a competitive domestic solar panel industry. This was predicted in shockingly accurate detail by HBS researchers 3 years ago. Protectionism is only going to make it worse -- amazing that these ideas still fly.
That practice of subsidized exports is called "dumping" and tends to continue only until domestic production in the importing area ends, and then the price is jacked up to make up for the losses.
Basically, we're trying to win in the long term at the expense of the short term, instead of the opposite.
Once they drive our domestic PV manufacturers out of business they'll be free to charge what the market will bear.
Probably because you can recognize horseshit when you smell it. Apparently, this article's author has never heard of solar lease programs, which are intended for precisely that market. Instead of paying money to the power company, you pay a lower power bill to a company that sticks panels on your roof (and presumably reaps the profits if production exceeds your usage). There's usually zero up-front cost, and these programs are readily available in many places.
Check out my sci-fi/humor trilogy at PatriotsBooks.
Firstly to address the article, one is a start-up loan guarantee to offset the risks in surmounting what is a huge barrier to entry, the other is a continued subsidy to aid an established industry. Sure they're both in the same vein of using public funds to bolster industry, but not quite comparable beyond that, are they? Continued subsidy of established industry is one of the major arguments made by those who are against US agricultural subsidies, and they make a reasonable point regarding the negative impact it has to the outside world. Many countries feel justified to place tariffs on US agricultural products because of this.
Now to address your post, let's look at the not so apparent inconsistency in the rhetoric surrounding the motivations behind the subsidy. If the Chinese government indeed only wanted to make renewable energy more affordable for the average Chinese person, as many say is the sole motivation, it could very well have implemented a tax rebate policy with low-income allowances for Chinese consumers (as it's typically done in the US, at least the rebate part) -- and if fearing the money drain to imported panels, they could even have made "for use on domestically made panels only" a condition for such rebates/allowances. Under such a policy, imported solar panels would find it difficult to compete in the Chinese market, but it wouldn't be as big of a deal. That's not what happened. By continuing to subsidize the already established manufacturers directly, it places anti-competitive behavior behind the rather more difficult-to-assail rhetoric of "making energy affordable for the average Chinese person." Unfortunately, this rhetorical sleight of hand is able to misdirect many people.
your thin skin doesn't make me a troll
Tell that to the Republicans.
On the one hand they scream (after MASSIVELY SUBSIDIZING their puppetmasters in the big oil companies and the corn lobby) about the subsidization of companies like Solyndra. They do this ignoring the fact that it didn't work because China was engaging in dumping and any trade with China is fundamentally unfair trade due to Chinese environmental-destruction and slave-labor practices.
Then they complain about how Solar power is "not financially viable", and likewise for wind, geothermal, and pretty much every other renewable resource we've got. The Republicans gave the corn lobby a massive gift when Dumbya's administration outlawed MTBE and forced 10% corn ethanol into gas nationwide, despite the fact that corn ethanol is a net loss of energy (1.8 units used for every 1 unit produced) to make. The subsidization of the oil industry is orders of magnitude larger than any subsidization we've ever given to clean power.
It's like when 50 years ago the Democrats became beholden to the Teamsters; in came big trucking and the subsidized interstate system, meanwhile rail shipping - far more energy efficient for long distances - got fucked up the ass having to eat the costs of maintaining the rail lines unsubsidized.
If you see a government policy that's fucked up on energy, follow the money. Chances are, this decade there's a Koch hand behind it - the decade you choose you may find someone else.
To expand a little bit.
Obama's "Green" initiatives are about more than implementing a renewable technology such as solar. Just as important in that imitative is "Green Jobs". It is seen as a twofer, ween us off the eeeevil oil and bring manufacturing jobs back.
The reality is that most of that 21 billion was heavily subsidized by the tax payers, the purchase, the manufacturing and the installation. China is undercutting all of the domestic manufacturers by doing the same thing. It's kind of ironic that we subsidized our solar industry but now they want tariffs because China does the same thing, only much more.
In the end, the tariffs are a last ditch effort to salvage the whole green jobs thing.
When Fascism comes to America, it will call itself Anti-Fascism, and tell you to give up your guns.
Precisely. Consider what happened with water in my area; we entered a conservation phase, and they promptly jacked up the water rates "to ensure minimum funding to maintain the system." Water conservation phase ended, usage increased and... hey look the rate stayed the fucking same.
Reminds me of seasonal gas price hiking. Nothing to do with politics, everything to do with greedy-ass oil execs and Saudi princes.
The poor usually don't have their own roofs to put solar panels on. Their landlords may not bother to. Mounting them in the yard may not work either.
Let's focus on the markets that CAN take advantage of roof mounted or ground mounted solar. Or not.
deleting the extra space after periods so i can stay relevant, yeah.
From orbit. That's the only way to be sure.
However, dumping doesn't make sense here. Properly maintained, a solar installation can reliably last for many decades with only minimal replacement.
Dumping exists to cause a mad rush of adoption, to set the hook for lock in. If adoption also translates to reduced demand later (see eg, computer sales figures from 1990 to today for an indicator of saturation with durable goods), then dumping makes significantly less sense.
More likely, china is trying to bolster capital to rapidly develop a thriving industrial production infrastructure, and the current situation provides a ripe opportunity who's time has come.
The US populace *DESPERATELY* wants to be rid of expensive and toxic fossil fuel use. So much so that they are willing to break the bank on one-off investments on domestic solar. (Something highly uncharacteristic of the typical us consumer's demographic profile)
China says "we can make solar cells for you! We can make them DIRT cheap!"
US consumers shout "SOLD!"
US regulators go "Oh No! OMGWTF! If they all switch to solar, we won't have as many reasons to stay in a state of purpetual war with the middle east, and our out-of-channel campaign funding sources will diminish! This is terrible! We have to act! We have to drive the prices of these deleterious cheap solar installs back up to protect our interests!"
So, they institute tarrifs to drive the prices up, in the hopes of preventing widespread solar adoption.
I would bet dollars to holes in doughnuts that the leading voices behind the tarrifs have memberships in the GOP, and hold shares in energy companies.
MTBE, being water-soluble, was a mistake. Spills became uncontainable.
Ethanol is a loser, but neither party has the will to turn off the subsidies, and every other ethanol source besides corn is a loser as well.
Growing food for fuel is stupid.
deleting the extra space after periods so i can stay relevant, yeah.
I wouldn't call what we're doing "massively subsidizing." When compared to the subsidies for petrochem and nuclear we're more offering minimal or token subsidies.
Not too long of a way to go. Basically they need to get the panels + installation down another 25-50% (and technologically this is not insurmountable) but in addition to that, they have to do so with something resembling a respectable profit margin. RIght now companies are running things close to the wire trying to compete, and that's not sustainable on a financial plane.
Of course, if the price of competing energy goes up (if there is a recoveing economy, it will) then that makes the competitive point for solar easier to acheive. In some local markets, solar is already cheaper.
Someone had to do it.
Obama's "Green" initiatives are about more than implementing a renewable technology such as solar. Just as important in that imitative is "Green Jobs". It is seen as a twofer, ween us off the eeeevil oil and bring manufacturing jobs back.
The reality is that most of that 21 billion was heavily subsidized by the tax payers, the purchase, the manufacturing and the installation.
You say that as if it is some kind of dirty secret. But isn't this what the Obama administration has been saying explicitly from the start? And why would they be ashamed of it? It sounds to me like a good investment of public money.
I spent six years in Tucson and I know folks who have PV panels on their rooftops which provide most of their power. There are lots of urban areas that get a shitload of sunshine.
I agree, though -- solar isn't going to provide baseload power. It's not just coal and oil, though -- nuclear can, too. So can geothermal.
In the end, the tariffs are a last ditch effort to salvage the whole green jobs thing.
Except this backlash isn't exclusive to the USA.
"Here is a pair of graphs that demonstrate most vividly the merit order effect and the impact that solar is having on electricity prices in Germany; and why utilities there and elsewhere are desperate to try to rein in the growth of solar PV in Europe. It may also explain why Australian generators are fighting so hard against the extension of feed-in tariffs in this country."
http://www.crikey.com.au/2012/03/27/why-generators-are-terrified-of-solar/
"I've got more toys than Teruhisa Kitahara."
There is one market where solar is becoming a must, and that is RV-ing. With all the electric-hungry appliances that are running off 12 volts, coupled with the fact that batteries take a long time to come up to full charge, solar is becoming a must have for anyone with a RV who isn't just staying on an RV park's shore power 24/7/365. With rigs getting larger, there is plenty of space to add panels.
Add to this flexible solar panels that can be rolled up, and I can envision someone able to run appliances like the A/C or microwave off a battery bank that is recharged by the solar panels on the ceiling, awning, and perhaps an extended room.
So, for RV-ers, it is something that allows for the comforts of home without having to break out the generator.
I mean, they're nice and if you can get them, do it. But! I went off-grid in '80 or so, when subsidies were hard to find, solar was $7/watt for panels or more, and it still paid off. I just doubled what I have here so as to have enough extra to charge my new Volt too - and it's a pretty big deal to just tell the gasoline man to get lost entirely - more panels is also more times the house system needs no backup. Finally there. !00% NOT Chinese stuff, though I have no axe to grind with them as a people. I just prefer poly xtal big, thick, reliable, conservative cells, that's all - I've got them 30 years old at still 80% of original spec. Even those are down to 3.50/watt or so now, made in USA if you care (I don't much, I'm just trying to get the most kWh/buck). It was hard at first, but built good habits of no waste, and now its fantastic - and no monthly bills...just internet. I got a much better subsidy thusly - I bought raw land and homesteaded on it. Power companies are in a lot of places, in charge of enforcing the building permit and inspections regimes. So, if you're not and never become a customer - well, my buildings are taxed as barns and sheds even though I obviously live here. In today's tax environment - lookee, no property taxes to speak of.
Why guess when you can know? Measure!
Yeah, energy policy in the U.S. is amazingly fucked.
One thing that really gets me, there are enough geothermal hot-spots in the US to provide a huge amount of power, especially if the R&D were funded like drilling in the 60's and 70's. Even better, we've already got a huge amount of operational know-how and technology from that very investment that could be adapted to geothermal power use. The basic hole drilling technology is the same, and only small modifications would be needed to bring us around to closed cycle steam/water loops and we already know how to turn hot steam in to electrical power.
You guys make me laugh. Even if a hand full of companies employ local workers and produce at competitive prices to the Chinese what makes you think these companies won't in turn out source those jobs to China to become "More Profitable(TM)"?
Common guys lets sit down and think about this for a second. The middle class makes money via manufacturing. People who own these companies make money by giving your money to the Chinese to do the same work for a whole lot less, with the added benefit of not having to see how the sausage is made.
Even if one company attains this insurmountable goal and eventually goes public, then by their responsibility to their shareholders alone they will be obligated to fire every one and send the work out east. So stop it with this stupid pipe dream and find something the Chinese CAN'T do at a fraction of the cost and work up from there. Trying to fantasize you can make a dead simple polymer sheet cheaper than the Chinese is just not going to happen.
A loop, by its nature, continues. If that didn't make sense, start reading this sentence again.
I hear this same argument all the time here in Anguilla where I live. "we don't want solar unless it reduces the cost of electricity for the poor man".
It's nonsense because solar is not going to drop the wholesale price of electricity, the differential from the price of NG or Nuke is never going to be substantial enough. Electricity in America is very very cheap. There is little point in trying to reduce the cost further, it is mostly administration charges at this stage.
The reason countries like the USA and other are promoting solar is because it is a renewable source. OIl and other fossil fuels are filthy and news of their imminent demise is not exaggerated. They will run out. America has a responsibility as a first world nation to reduce emissions.
Turning to renewable sources allows more time before the end of oil and for the technologies to develop. You can't expect we can transition once there is a crisis. Unless we start now and incentivize the use of RE, we will never get to a point where we can manage without fossil fuels. Great strides are being made and the discovery of grid based storage at economical cost will be a game changer.
Another reason to promote RE sources is energy independence. If countries that are not in the Middle East could survive on domestic production and renewable sources, the politics of the world would change dramatically, and the price of energy would drop, spawning another economic boom. At present, the US public is crying about high gasoline prices caused by geopolitical issues, but at the same time complaining about subsidies for renewable sources aimed at developing solutions to this issue. And blaming Obama for both.
Let's make this very clear. Oil will get more and more expensive until it runs out, the planet will warm in the mean time from CO2, and there will be instability in the Middle East and Venezuela. Or you can believe the Forbes and Fox News stories that tell you the opposite.
I live in a country that has probably the highest electricity costs in the world, 43c/KWh, unlimited sunshine, and refuses to allow people to install solar. Figure that policy out. Very soon we will not be a viable state because of high energy costs, but there is still no vision or will to move out of the dark ages.
Be glad you at least have the right to install solar or wind or whatever.
CM www.cometenergysystems.com Blog: http://caribbeanrenewable.blogspot.com/
Have you been to a non-electrified camping ground that allows RVs? People who drive huge vehicles towing huge campers and sometimes an extra vehicle, ATV or boat achieving a paltry 8-13mpg have absolutely no qualms about breaking out the gasoline generators.
They can't leave the comforts of home behind, including the noise and smog.
We have the best government that money can buy.
Don't keep me in suspense, does it work out to more or less than the 150 years it will take us to exhaust all the proven, unproven, and unconventional reserves of oil in the world?
"Who is the Journal of Quantum Physics going to believe?" --Stephen Hawking
We just talked to a sales rep from Verango, they do just this type of system. Sunrun buys the panels and maintains them. Quoted us 27.5 cents/kwh to start in the first year to replace the 131%+ tier power that we are charged higher rates in California on.
I created a spreadsheet to calculate our average cost/kwh over the last year in the upper tiers, and it worked out to 32.5 cents. So we could save 5 cents/kwh, or $31 per month if our usage stayed the same the last year. Not enough for me to bite, even if it costs us nothing. I'd rather find ways to reduce usage and cut our bill by more than that. We'd planned on doing that, which means the savings would be even smaller because our usage in the top tiers would be going down anyway.
Incidentally, part of his pitch is that energy costs increase 6.9% per year. The 20 year solar contract locks in increases of 2.9%. So part of the argument is that over time, solar costs will go up at a much slower pace than electricity costs from PG&E. The only thing is, there has apparently been so much outrage over electricity costs in California that last year they got the highest tier rates lowered from around 40.4 cents/kwh to 34.2 cents/kwh, and the next highest tier also had a decrease from around 33 cents/kwh to around 31 cents/kwh. (Baseline and 101-130% tier rates went up a little) Which kind of negates the argument that energy costs go up every year, and reinforces the fact that energy companies are regulated by the government, so there are ultimately some political factors involved (aside from market forces, etc) in determining rates that are charged.
corn ethanol is a net loss of energy (1.8 units used for every 1 unit produced) to make.
I'm not the biggest fan of corn ethanol, but this is a very outdated myth from a study in the early 1970s that people keep repeating. We've gotten much more efficient and corn ethanol is now 1.5 to 1.8 units produced for every 1 unit of energy put in. That's still way worse than most other biofuels, but it isn't a net energy loss.
Because we just paid good money (a few billion here, and a few billion there), using a loan with an significant interest rate (which will be counted as an asset, and never repaid), for an industry which will not profit, and I mean that in a more than monetary sense, its investors (it will neither provide the long-term jobs as promised, nor increase the absolute wealth of those involved, nor help in any meaningful way to achieve a sustainable 'green' agenda). It shows a supreme lack of vision (we'll talk solar when the efficiency of those cells increases to a competitive level with other technologies and the energy storage problem is solved), understanding of human nature (who didn't think the Chinese would steamroll this industry?), economics (spending money to make money, only not), and science (do we do that anymore? I see lots of paper, journals, publications, yet nothing noteworthy).
And yes, I am mindful that past presidents have also acted in an equally foolish capacity. However, that does not excuse the current guy; let's try to hold them to a higher standard from now on, right?
Finally, I feel as if I am watching an heir of an empire burn through his / her money, because "there will always be more." A little less the lovable eccentric who occasionally hits on a brilliant idea that leaves others questioning whether he / she is really insane, or just brighter than them (and keep said eccentric far enough in the black that his / her feet never really touch ground); a little more the loud, annoying frat kid whose father owns a car dealership, so it's cool to keep spending, because people always need cars, right?
I am John Hurt.
'Cos there ain't no meter on the Sun,
No, there ain't no meter on the Sun.
How ya gonna charge
Enough to keep ya livin' large
When there ain't no meter on the Sun?
"Flyin' in just a sweet place,
Never been known to fail..."
Except Solyndra didn't actually outsource their manufacturing to China. They had millions of square feet of factory space in CA.
It's not good for those natural gas/diesel plants, as well as coal plants, all whom have enormous capex costs they're locked into.
Would you want to be a nuclear power plant owner, with ~$1 billion sunk into your facility if someone invents (for the sake of argument) an arc reactor that fits in the palm of your hand and generates all the power you'll need for months at a time in a few seconds?
Entrenched interests fight the new guy, film at 11.
Except solyndra was about payback for democratic political donors rather than developing tech.
If they really want to spur domestic production they should simply tie any subsidies or tax breaks for solar installations to using US made products. The chinese are deliberately trying to crush manufacturers of everything in the US. It's economic warfare and they're winning because we aren't even trying to play.
Taxing the chinese products is more proof that obama and the dems have absolutely no idea how to handle the economy. To them it's all magic, which is why so many of their policies turn out to be smoke and mirrors.
I have mod points. The reign of terror begins now.
Taxing the chinese products is more proof that obama and the dems have absolutely no idea how to handle the economy.
It's actually a pretty standard response to an unfair subsidy: China pays $X to reduce the cost of Chinese solar panels, we charge $X in taxes to offset the subsidy and destroy the unfair competitive advantage. And China then loses all incentive to continue the subsidy, because the money isn't actually going to their solar industry anymore, it's just going to pay the tariff which would be eliminated if they stopped paying the subsidy.
Of course, the smart thing to do would be to impose a tariff on Chinese solar panels which doesn't capture the entire subsidy, and then pay the money collected to the domestic manufacturers to eliminate the competitive advantage created by the remainder of the subsidy which isn't collected as a tariff. The consequence is that China is then subsidizing world-wide, rather than only Chinese, manufacturing of solar panels. That's a good thing.
And, if you want to be strategic, make it known that you won't discontinue this arrangement until few years after China discontinues the subsidy, to give them an incentive to keep it -- since discontinuing the subsidy would then make their solar manufacturing totally uncompetitive for a few years, but keeping it (and thereby subsidizing everyone) would leave their industry on the same playing field as they would have been if they didn't decide to play this game in the first place.
"Green" energy is sustainable:
- Clean energy is competitive with other types of energy
- Clean energy creates three times more jobs than fossil fuels
- Clean energy improves grid reliability
- Clean energy investment has surpassed investments in fossil fuels
- Investments in clean energy are cost effective
- Fossil fuels have gotten 75 times more subsidies than clean energy
For more details on these points:
http://thinkprogress.org/romm/2012/03/28/453122/fact-sheet-6-things-you-should-know-about-the-value-of-renewable-energy/
I don't read your sig. Why are you reading mine?
Obama's "Green" initiatives are about more than implementing a renewable technology such as solar. Just as important in that imitative is "Green Jobs". It is seen as a twofer, ween us off the eeeevil oil and bring manufacturing jobs back.
The reality is that most of that 21 billion was heavily subsidized by the tax payers, the purchase, the manufacturing and the installation.
You say that as if it is some kind of dirty secret. But isn't this what the Obama administration has been saying explicitly from the start? And why would they be ashamed of it? It sounds to me like a good investment of public money.
If it's a good investment, if it's actually "booming", it shouldn't need public money.
No one is claiming that Obama has been quiet about being bullish on green jobs / energy. The dirty secret is that the press has played up these numbers that are wildly inflated by federal spending. The dirty secret is the number of Obama campaign contributors who got this money.
And this is a symptom of the continuing problem with Keynesianism in the modern economy: in the past, the government could dump a ton of money into the economy and investors would believe that there was going to be a lasting surge in demand, and they would invest assuming that it would last. That additional investment would outweigh the contraction in GDP after the stimulus ceased. But now, with the Web and a deluge of financial information, investors know exactly when the economy will contract after the stimulus ends, so they don't make long term investments, and the contraction after the stimulus ends is even worse. This is what we're seeing with the green stimulus falling apart.
Space solar is not likely to be a win under realistic assumptions, especially when we could be deploying solar on the ground right now. http://physics.ucsd.edu/do-the-math/2012/03/space-based-solar-power/
Until someone says "Surplus! We should spend that!"
Federal budget problems are like a leaky roof: "If it's raining, can't fix it. If it's not raining, it doesn't leak."
or Rich Dude underpays his workers and uses an economically damaging manufacturing method. Rich Dude funds a "social welfare" group that lobbies for corporate "freedom". Things that will "level the playing field with other countries", like disbanding the EPA, or doing away with minimum wage. His accountants decide that these are necessary business expenses and tax deductible, it doesn't hurt that the organization he is donating to has no legal requirement to disclose donors.
Rich Dude's company banks the rest of his money to buy out competitors or seal up exclusive contracts with suppliers. Money in the bank gives him a pop star status and allows his company to throw lavish business conferences (for tax puposes) that happen to coincide with his birthday or his wife's. Rich Dude is able to borrow against the equity in his business and take a $1 a year salary, make it 50k if your not Steve Jobs. Rich Dude's vacations include stops to visit customers and become business expenses.
Meanwhile Rich Dude's money is being hoarded by his bank who is afraid to loan too much in this business climate. Workers (Rich Dude's) don't make enough to pay back loans. The bank eventually decides to loan the money out anyway and package the loans up so suckers will buy them as investments. Or the bank buys credit default insurance. The bank eventually crashes the world economy and that "social welfare" group I mentioned above uses the bad economy to convince people to make sweeping changes to regulations and laws. The country stagnates. Rich Dude can't figure out where his customers went, so he retires to 3rd world country and lives in luxury for the rest of his days.
Cheap storage VM.