Energy Policy

[Jnyusa]

Then lock the thread! I see no point in saying anything else.

Faramond, I'm sure that sol is not arguing that oil is the resource of the future! He is arguing that solar is not the resource of the present.

I say this discussion is insane because we do all agree that the transition has to take place. As consumers we understand that the resource is finite and becoming more expensive every minute.

This notion that we have to sort of be nice to oil companies or something by pretending that we can't live without them, for a little while longer at least, this is very puzzling! We could have started getting rid of them decades ago and we can start right now. There is nothing stopping us except an inexplicable reluctance to do so. When has it ever happened that so many intelligent people agreed for so long to act so thoroughly against their own self-interest?

The difference between us and Europe- the reason you need a transformer- is that our standard is 120 volts at 60 hertz, and theirs is 240 volts at 50 hertz. But if it weren't AC, there wouldn't be any hertz!

Ah! I stand corrected! I have embedded in my brain the very goofy rejection of AC by NY State when it was first demonstrated to them.

This discussion launched IIRC from the debate over opening the Continental Shelf and/or ANWR. We don't need to conquer it. The oil is just sitting there.

I'm not sure the (sometimes) public end of the power infrastructure requires a choice between Source A and Source B. Once it's in the grid, watts is watts. Why shouldn't Acme invest in shale oil and Mega invest in solar, if thy think that's where the money is? Neither precludes the other. But you seem to be saying (I may be mistaken) that Acme must be suppressed in order for Mega to succeed. Or am I missing something?

What I have read of the shelf oil and the ANWR is that: (1) if we begin the construction of shelf platforms today, it will be 20 years before there is an actual delivery of refined product out of those facilities; and (2) the amount of oil in ANWR will fuel our economy for 3 days.

You are right that we would not have to choose between Source A and Source B if they both cost the same (at present value of course). What is missing is the public acknowledgment that they do not both cost the same. We keep pretending that fossil fuels are somehow nearer to the tap and/or cheaper to access and this is just upside down from the truth. As a matter of public policy, if the government is going to put funds into the private sector they should put the first of those funds into the projects whose C-B outlook is the best.

For example, when I was listening to this industry guy he was using Montana as an example. That is not a populous state, ok - I'm sure the picture would be different for PA, but we also have better insolation than Montana does ... with the current efficiency of photovoltaics, a line of cells 40 miles long would provide 100% of all the household electric needs in Montana. You can't tell me that it would take less than a year to transition Montana to 100% solar, and that this would not be cheaper than drilling on the continental shelf to obtain ... however many more years of oil and then transitioning again. It just makes no sense, when choosing between those two options, to choose the shelf over the solar panels. The panels have a present value cost orders of magnitude lower than the shelf oil and the benefit is precisely the same - 100% of the electricity.

Of course you would not do it like that, a 40-mile-long row of solar cells, but that is another reason why the energy companies are resisting this even more vigorously than the oil companies are.

The most efficient way to distribute solar power is to have the equivalent of a substation in every neighborhood. We already have substations in every neighborhood, you see, but they are receiving energy from a centralized source, not generating it themselves. Some of these are privately owned. The complex where I live owns its own substation. There is a switching station (not sure exactly what they call this) that pulls power off the main line and sends it to our substation, and then the substation distributes it to the buildings in the complex. The distribution system exists. There is no reason why the substation could not house a solar frame instead of a coil.

Do you think PECO wants to see this happen? We don't need their grid at all! The only thing that stops us (besides the fact that this place has been run by a bunch of morons for the past 40 years) is the fact that if we had switched 10 years ago, we would have paid PECO for the energy we did not use for the subsequent 10 years, while also paying for the new technology. That was Pennsylvania law - you continued to pay PECO for electricity at a rate determined by some formula based on your prior use, even though you were no longer using their product. I think that must be unique in our history, that a government within the U.S. forced people to pay for a product they did not obtain. It's insane. It's corrupt. And you know what, sol? - that's communism.

That's why I feel that the free market is truly irrelevant to the discussion. One of the reasons the energy companies have dragged their feet so long is because they want solar to be produced and delivered using their own current facilities. They want to be sure that when the government subsidy comes through - and it will! one more Iraq and I think the American people may start shooting at oil company executives from the tops of water towers - they want to be sure that when the subsidy comes through it goes to them and not to some nebisch who decides to give the finger to the system and put a solar panel on his roof.

[Faramond]

It would be nice if one of the candidates for president would talk about this stuff. Or hire you as an advisor.

I really don't know what to say in this thread. I can't disagree with you without seeming like an ignorant fool. Not that I see anything in particular I want to disagree with.

I remember being dragged along to a home and garden fair at our local fairgrounds by two women earlier this year and seeing a lot of companies trying to sell solar power set ups. I was really surprised there were so many.

[Griffon64]

I don't remember seeing any of those solar power setups. I was too busy looking at the water features

[Jnyusa]

I can't disagree with you without seeming like an ignorant fool.

I'm not trying to make people feel like ignorant fools. Really not! But maybe to incite people to google around and see what's really there. If you key in "solar power" your first twenty hits at least should be producers and industry trade associations, not, you know, the Green Party.

Where the Green Party is concerned I haven't even begun to voice my disgust for their mishandling of energy issues.

Right now my beloved local Greens, confronted with another certainty of loss across the board in upcoming elections, busies itself discussing how "truthful" versus how "counterproductive" it might be to compare Dick Cheney to Adolph Hitler in its campaign materials.

I said we are insane for asking ourselves on this board whether we don't need to put money into shale oil, but really, compared to the question my local Greens are asking themselves right now, we are paragons of rationality.

I was too busy looking at the water features

That's me too! As soon as I am able to own my own home again, two things are going in:

Backyard Pond
Rooftop Solar

[yovargas]

That is not a populous state, ok - I'm sure the picture would be different for PA, but we also have better insolation than Montana does ... with the current efficiency of photovoltaics, a line of cells 40 miles long would provide 100% of all the household electric needs in Montana.

What is it that you see stopping this (or whatever the more reasonable RL equivalent would be) from happening?

[ArathornJax]

I know that we have been looking into this and for us, it is cost . . . . but we are weighing several options. Here's an example of some basic research we've done in terms of cost. Perhaps were not looking hard enough yet either.

EXAMPLE 3KW SYSTEM – HOME INSTALLATION COST

It’s time to install that 3kW solar electricity system you’ve been thinking about. In ___________ (where I live), you’ll need to shell out about $49,500, but you do get $2,000 tax credits from both the state and federal governments. If you’re a typical customer using about 1,300kWh each month, your solar system should pay for itself in about 25 years since the state has a Great solar rating (assuming a rate of $0.0781/kWh with Pacificorp). While your system is paying for itself, you’ll also be saving over $880 each year on your utility bills. Your savings should grow too since rates will jump to about $0.08/kWh in 5 years and $0.121/kWh in 25 years. Even better, you’ll be keeping over 297 tons of greenhouse gasses out of the atmosphere; that’s like planting 872 trees or taking 52 cars off the road. Check out these other important details and benefits:

* 550 square feet of roof area required
* Estimated property value increase of $10,520
* Estimated utility savings over 25 years of $22,072

I have seen estimates from $25000 to the $45000 or so mentioned here. I guess I need to get serious and get some quotes.

In another notion where I live we have wind breezes throughout the year and a we are also considering a wind turbine (a neighbor down the path has one). I've read of costs for a small turbine installed ranging from $10000 up to $50000.

I guess the bottom line for my wife and I is trying to get quotes that are in a price range we can afford and that will work for us. Another thing is that in research it seems with the advances coming in this technology the question is when to do it. It seems that every couple of years advances are made that make older versions of either solar or wind energy outdated, much like a computer. I could be wrong and I would love to hear Jnyusa's comments on that. At some point we are going to probably go solar, we just need to put the time into doing our homework and ensuring when we do it in the next year or two that we feel we are dealing with a premium installer.

I also think the quote above brings up a couple of points that are important. I do not believe for one second that current energy prices are going to drop significantly moving forward. Oil prices have dropped, but I don't believe for one moment that I am going to see $1.50 per gallon gasoline again in my life. I also do not think that the energy to run my home will go down long term. Even when this country moves to what are called alternative forms of energy, cost will remain high in order for those businesses to maintain profits (until they get out and find a new business to go into). Going to solar is really one way to go.

Next, whether you believe in global warming (I do) or not, the saving of green house gases/pollution is enough to warrant it. I guess I feel that if a generation has to suck it up on this issue, it is better that my generation (I'm 43 right now, so those of us in our 40's) sucks it up and makes the transition rather than my children or my grandchildren. I appreciate Jnyusa's comments on this; I've felt like I'm a student in the midst of a master and I've feared to say anything because of showing my own ignorance on this subject (this is the second post I've done, I deleted my other one). So I guess my question is where is the best way to go about finding companies that have excellent reputations in order to get quotes?

[solicitr]

That's very encouraging, AJ. If the numbers add up, do it. Unfortunately, I doubt many people are prepared to (or even able to) front that cost with a 25-year payout.

And of course I realize that you are viewing this system as a supplement to the grid, not a replacement. But therein lies the rub: when you need the lights on, solar can't power them.

I'd like to post more than a drive-by, but I've gotta run. More later maybe.

[River]

And of course I realize that you are viewing this system as a supplement to the grid, not a replacement. But therein lies the rub: when you need the lights on, solar can't power them.

Five minutes on wikipedia. Less for you because I've even done the hard part and found the relevant section of the relevant article.

[solicitr]

River, in the context of independent home systems, storage is a major issue. Thermal storage won't run lights or AC, even if it will heat the bathtub. What's left is batteries: but now you're taking about a 1/3 loss rate, as well as the fact that batteries are expensive, short-lived, temperature-sensitive, and a disposal problem.

I don't see Jny's model taking hold. Yes, in theory we could all of us have declared independence from Big Power years ago by installing our own diesel generators- we found it more convenient not to. Moreover, wind and parabolic solar are very much industrial apps, not domestic power sources. The off-the-grid thing strikes me as a bit Great-Leap-Forwardish.

[Jnyusa]

I have seen estimates from $25000 to the $45000 or so mentioned here.

$45,000 would be quite high ... I've seen quotes that high for powering a McMansion with families of 5-6 and running, you know, six loads of laundry a week, but for a 3-bedroom house powering a family of 3-4, it should cost you less than $28,000.

It's cheaper in states that have tax credits, which, unfortunately, Pennsylvania does not have. In NJ the front-end grant and back-end tax credit pretty much halve the cost of a normal system.

River, in the context of independent home systems, storage is a major issue. Thermal storage won't run lights or AC, even if it will heat the bathtub.<snip> What's left is batteries: but now you're taking about a 1/3 loss rate, as well as the fact that batteries are expensive, short-lived, temperature-sensitive, and a disposal problem.

I believe that the new thermal storage systems can be used to generate electricity, but you're right that there are two common options for storage:

(1) Stay connected to the grid and pull from it when you need to. I don't know of any state that does not require you to do this anyway. It's against the law to disconnect from the grid. There are a few states (I'd have to do some research to know how many) who require the utility company to have backward running meters so that you're paid for the electricity that you put back into the system, and that happens continuously during peak insolation.

(2) Batteries: you need about 2 per cell. They are not a major component of cost; no one worries about the disposal problem with car batteries (!) though this is obviously a long term problem that would have to be considered; and the energy loss associated with a battery is irrelevant if the underlying resource is free. Conversion efficiency is only an issue when the underlying resource is limited.

The solar cells themselves are not a major component of cost either - $600-700 per cell.

The big ticket item is the transformer, and its installation and maintainance. That's a scale economy issue, if we want to talk about scale economies. The more people using solar, the cheaper both these components will get.

I would argue that the absence of an installation and maintenance network is the single largest impediment at this time. I don't know anyone who would know how to electrify their own house, and by law you're not allowed to do it anyway. If you want to rewire something you have to employ a licensed electrician. So when you go to a solar provider and purchase the cells and transformer, the installation is included in the price of the package and that's about 80% of the cost, iirc. Then if you require maintenance you have to go back to your provider to get it.

Adding solar installation and maintenance to our trade school curricula and apprenticeships would take a big chunk off the top because then you could buy the cells wherever they were cheapest and have your local electrician hook up the transformer to your existing circuit breaker. Not that electricians are cheap but you wouldn't have the product immobility problem that you have right now.

Moreover, wind and parabolic solar are very much industrial apps, not domestic power sources.

Yes, and that was the great argument against renewables for the first forty years of opposition! But they can't run machinery!!! Now it's ... oh, well, yeah, guess they can run machinery after all BUT you can't drive 80 miles an hour down the freeway in a solar car. You can't turn your lights on at night in a solar house (and you can, of course) ... but anything, anything to stop progress.

The off-the-grid thing strikes me as a bit Great-Leap-Forwardish.

Compared to what? Shale oil? Solar and wind are at our fingertips compared to the waiting time and the return to the consumer involved in exploiting new fossil fuel sources.

What is it that you see stopping this (or whatever the more reasonable RL equivalent would be) from happening?

What's stopping it is the government refusing to support it, yov.

I don't mean this at all in a conspiratorial way. Government gets convinced of an idea and then spends a couple decades looking in the direction of that idea, pouring money into that idea, developing corporate-government relationships around that idea, and in order to crowbar the collective neck of Congress so that it faces in a different direction you have to organize a tremendous lobby effort.

You're a single guy so your kitchen is probably not as well-equipped as mine is but I'm looking into my kitchen right now where the dishes need to be washed, and with the exception of my flatware (forks and spoons, you know), every single piece of cookware, every dish, every stick-free pot and pan is made from a material developed for the space program. They didn't all end up having space application, but once the government supported R&D the companies found a consumer application for those inventions and the endless spinoffs from them.

When the plastics industry wanted to inundate the world with plastics, what they said about glass was that it breaks too easily, it cuts you when it breaks, it weighs a ton, and so on. But now we have arcoroc, which is glass, and you can beat on it with a hammer and not break it, and when it does break it breaks by shearing action so it does not shard, and it weighs very little compared to conventional glass. Glass-tempering technologies got their boost from the space program ... and so did the development of the competing polymers! This is all government, it's everywhere government, almost the whole array of product offerings we see before us today can be traced back to some government effort, often unrelated to the product we now have.

This is for the reasons I offered above. You would never get the long-term R&D required for this kind of progress without government guaranteeing the market. What we need for progress, mainly, is a government that is teachable. A government whose feet can be held to the fire of allocative efficiency.

[solicitr]

On batteries, Jny:

the relevant example here isn't the little 12-volter in a conventional car- which has no necessary function at all except to power the starter motor for about five seconds. The automotive parallel is with batteries that actually power a vehicle: those in electric cars and hybrids. In that application batteries have been and remain the limiting- often very limiting - technology. The old EV-1's batteries only lasted 20-25,000 miles before needing replacement. Those in current hybrids are a lot better- but a 'lot' means they last twice as long, or still less than half the car's lifetime. And the replacement cost is brutal; not to mention the disposal problem, not of a 30-lb Die-Hard, but several hundreds of pounds' worth of toxic components.

I'm not in the least objecting to the addition of renewable sources to the grid: of course not. What I fail to see the logic of is the abandonment of the existing power-distribution infrastructure; not only because of scale issues and the fact that it's already there, but because of its capability to respond to fluctuating demand.

Earlier you stated, as facts, that new petroleum can't come on line for a decade or more; and that ANWR contains 'three days of oil'. Both of these asserted facts are repeated over and over agin- but is this anouthr information cascade? The Petroleum Institute (yes, very biased but they do know about drilling) claims that the California shelf could be producing in two years once the ban were lifted. Pilot oil-shale plants are already in operation, with a full-scale one nearing completion.

Crude oil prices are the primary determining factor
for future levels of domestic unconventional oil production
(such as oil shale, CTL, and GTL). In the
AEO2008 low price case, CTL production begins in
2011, using only U.S. facilities now under construction,
and remains at 40,000 barrels per day through
2030. With the higher oil price in the reference case,
CTL production starts in 2011 at about 50,000 barrels
per day and increases to about 240,000 barrels per
day in 2030 (Figure 86). In the high price case, both
GTL and oil shale production become economical,
and total domestic unconventional oil production
increases to 1.5 million barrels per day in 2030—1.2
million barrels per day from CTL, 130,000 barrels per
day from GTL, and 140,000 barrels per day from oil
shale.

--EIA 2008 Annual Report

As to ANWR: nobody 'knows' how much oil is under ANWR. There are estimates- which range all over the place, from 8 to 16 billion barrels. Estimated. Unless and until exploratory drilling occurs, we don't know: Prudhoe Bay turned out to have double the estimated total.

And then there's coal- lots and lots of coal.

[ArathornJax]

I'll have to get looking into this because if it is $25k or so, that is really do able because my state offers a $2k cash back and the Feds match at $2k. Doing it for $20 to $22k is very do able. I just need to see where the technology is going and if it is better now or to wait for a couple of years (and get some quotes for purchase and install).

[Jnyusa]

the relevant example here isn't the little 12-volter in a conventional car

sol, the people I know who are bothering to put in a battery array for storage are using boat batteries. They are indeed comparable to the little 12-volter of a conventional car. They're exactly the same size and look exactly like a car battery.

What I fail to see the logic of is the abandonment of the existing power-distribution infrastructure; not only because of scale issues and the fact that it's already there, but because of its capability to respond to fluctuating demand.

I never said we should destroy or abandon the existing system willy-nilly. We should not be adding to it. We should not be drilling for more oil (or sucking it out of rocks or whatever) to create the supply on which the existing system runs when a cheaper alternative is available. We should be converting the existing infrastructure to use with renewables where possible, and where replacement is concerned we should "pick the low hanging fruit" as they say ... and I'll give an example of that:

all infrastructure has to be replaced eventually. Capital wears out. Nothing to do about it except replace it. It is generally true where fossil fuel emissions are concerned that the oldest plants are the ones that pollute the worst. So you begin with them - they are nearing the end of their useful life anyway, and for the substations connected to these older plants instead of putting in new coils and new switch boxes you convert the substation to solar. The house-to-house distribution system does not change except now the locus of generation has changed, and if you want to create some scheme whereby municipalites buy these substations from the utility companies and take over the responsibility for generating electric, then you do that. Or let the utility continue to own them but pay the municipality for the electric they generate. There's a hundred schemes by which one can mediate the ownership and revenues ... you let people sit down together and bargain this out. Crikey, we did it with the telephone company just to satisfy a principle, never mind a cost-benefit analysis. But you begin the transition now. Eventually of course everything will look different and be run differently, but that would be true anyway because technology changes even if you don't change your underlying resource.

I can identify three plants in Chester, PA that are going to have to be overhauled within the next five years. I would start with them, not with the new substation that was installed in center city three years ago. It's a shame that they did not go solar at that point, but they didn't, and that station has a useful life of 50 years so it would be prohibitively expensive to begin with that one. But with the ones in Chester there's going to be a vast new expense in the immediate future anyway, so put the dollar where the benefits will be greatest relative to the cost.

It doesn't really matter whether you are talking about the distribution system or acquisition of the underlying resource. The point is that when you have to spend one more dollar to obtain and deliver that supply that you need, that's the point at which you have a choice. Smart people pick the high-benefit, low-cost choice. We know which choice that is so we should be smart and pick it. That's all I'm saying.

[yovargas]

If solar really is cheaper, wouldn't the plants get replace with solar just for the simple sake of moneymaking? I have a hard time believing what you're saying because it seems like if it were true, people would just do it. If it's cheaper now, what's stopping the transition now? (Sorry if that's a redundant question. I don't think I'm really understanding your point on the need for gov involvement to make this happen.)

[Jnyusa]

If solar really is cheaper, wouldn't the plants get replace with solar just for the simple sake of moneymaking?

We're talking about a couple different loci of decision-making, yov.

For the utility company, the best way to preserve revenues is to leave the distribution system exactly as it is now (because they own it, or most of it), and to buy as much of their own supply as they can from solar/wind plants rather than from nuclear plants or coal-fired plants or wherever else they might get it. They are doing this, of course. They are buying the renewables. Our utility company gets 9% of its power from renewables. That's the maximum they are able to get given the generation capability installed in PA so far.

So now you take one step back along the supply line. We have to keep coming up with new sources of energy because once we burn the coal or split the atom it's gone. It isn't born again tomorrow so that we can use it a second time. So ... where do we go for continued supply? Solar, coal, oil, wind, shale oil, etc? These are all different industries and each one of them wants to be the ultimate supplier to the energy industry. Those who have a sinecure don't want to lose it, and the more uncompetitive they are the harder they are going to fight to keep market forces from determining the outcome. They lobby Congress, they publish endless denouncements of the alternatives, they spend billions on advertising, and they even buy up patents for alternative technology and shelve them so that they cannot be implemented.

Now all these industries are relying on government subsidies of one sort or another, whether it is the license to extract in certain places or tax credits for their R&D or invasion of some other country so that the tanker stays full. And their lobby effort is aimed at keeping the market for their product alive ... just ALIVE, ok? That's what government involvement does. It creates the market. And it is up to government to say whether existing subsidies will continue or whether public money will be used to create a new and different market. So tremendous effort is put into swaying the government in one direction of another.

If accurate cost information does get through to our legislature, they are evaluating it just as you are, as one piece of information in a sea of propaganda that they must wade through and evaluate, and they are not experts any more than we are. They rely on aides to sort fact from fancy, and the face time of the aides is restricted to the amount of interest the representative has in this particular issue, and the aides themselves are inundated with propaganda from lobbyists. The industry incumbants have the advantage over new start-ups, of course, because they are not staring down the barrel at a break-even point and their relationship with Congress is long standing. They have ad dollars and lobby dollars to spend in greater magnitude than the owners of the new technology on the block.

We don't have to be talking about energy for this to be true, by the way. It is so for any new idea, new technology, new research - bioengineering, pharmaceuticals, space exploration, military technology and so on. Everyone is lobbying government to keep their own corner of the universe alive.

The hitherto government bias against renewables is easy to see in the nature of the bills that get passed without quarrel, like the loan guarantees for the nuclear industry. So the job confronting those of us who don't want to pay for inefficiency is to educate our own representatives and, you know, play the lobby game along with everyone else.

OK ... go back to the utility company again for a minute. They do buy the cheapest energy they can get, and right now they have the supply of renewables maxxed out (in PA at least).

Now, from the utility company, take one step forward in the supply chain to that guy with a solar panel on his roof. He is no longer just a customer, he is now also a competitor. The utility company does not only sell electricity to him, they buy electricity from him as well. And the nature of this particular technology is such that the writing is on the wall (imo) that the supply of the future will be decentralized, not necessarily house by house but for sure neighborhood by neighborhood. That is something the utilities do not want, because then their distribution system becomes less profitable. If you want an analogy, think about the effort that Bill Gates puts out to make sure that other companies' OS will not be compatible with the Windows OS. This forces the consumer to buy all of one package or all of the other package, and as long as the transition itself remains costly, Gates will win because he already holds the advantage of scale.

The utilities would like to buy cheaper energy, and so they support the creation of solar and wind farms by buying as much product from them as they can, but they want to buy upstream, not downstream, and upstream the expansion of supply is being restricted by a different phenomenon - the competition of a whole 'nother set of industries for the market-creating power of Congress.

[Holbytla]

A couple of interesting articles about the cost of electricity and the effect of wind farms.

The 2nd article is not from a neutral source.

http://www.capecodonline.com/apps/pbcs. ... /803210308

http://www.capecodtoday.com/blogs/index ... ty?blog=41

[solicitr]

For the utility company, the best way to preserve revenues is to leave the distribution system exactly as it is now (because they own it, or most of it), and to buy as much of their own supply as they can from solar/wind plants rather than from nuclear plants or coal-fired plants or wherever else they might get it.

Except that, in most cases, the power company also owns the generating plants. It is Dominion Power or Con Ed which makes the choice as to whether its next power station will be coal, solar, gas or nuke. These utiliies are currently constructing numerous non-renewable plants. Why? Surely their own accountants and engineers are not being swayed by lobbyists.- and it would seem that if they are really worried about microgeneration, that the best way to forestall same would be jump into renewables first.

[Jnyusa]

Sol, the links that Holby posted claims that the utilities had to divest of their generating plants under deregulation.

To tell you the truth, I was surprised to read that presented as universal. I am pretty sure that some of the power plants which serve Phila are still owned by PECO, one being Peach Bottom Nuclear, unless that changed just within the last year. However, our PECO does buy solar and wind from independent power-generating companies and would buy a lot more if they could get it. (All this is available on PECO's own website. They report the history, output and efficiency of the plants they own.)

Surely their own accountants and engineers are not being swayed by lobbyists.

No, I presume not. But if you want to start micro-analyzing the capital decisions that are being made then we have to start considering additional microeconomic dimensions of the decision.

(1) The whole eastern half of the continent is a single grid, and power is directed back and forth all over the place to meet peak demand. If you're going to install a new technology whose output is unproven through long experience, even in just one place, you're going to first of all duplicate existing capability and not eliminate it because you can't afford to risk brown-outs in ... Ottawa, let's say, because of decision made by a utility company in Pennsylvania. So the transition carries a certain amount of risk, and it is precisely the cost of such risk that the government would be eliminating if it chose to step in and create a new market. We will have initially to create a surplus over current demand and then cut back the supply later by eliminating fossil fuel plants (oldest first) as the renewables demonstrate their ability to shoulder the load.

(2) If government does not do that, for whatever reason, and either the risk or the cost has to be borne by private sector companies, then they're going to get their feet wet first of all by outsourcing rather than by constructing their own facilities. And that is what we see happening now, with the utilities attempting to buy as much as they can of the cheaper renewables.

I think that ... well, one of the things we have to remember is that when you are analyzing the strategic decisions of a regional monopoly like a utility company, the variables are not the same as you would use for the strategic decisions made by a new start up, like a new solar plant constructed under venture capital. And they are not the same as the utilitarian decision made by a homeowner as to how long a solar installation would take to pay for itself in energy cost savings.

Yov is asking in one post, "if it's really cheaper why do we need the government at all," and you're asking in your post, "if it's really cheaper why don't the utilities themselves build different generating plants," but the fact that it is cheaper for the consumer (and the country) in the long run (and that that relatively lower-cost, higher-benefit is reflected in the net present value of the private sector investment) does not mean that existing monopolies and venture capitalists might not have specific risk aversions weighing on their decision and impeding the shift to a new technology.

The current decision-making that is taking place in the private sector, whether we are talking about the venture capitalist or the utility company or John Q. Public wondering whether to buy a solar panel, that decision-making is neither mysterious nor irrational, in my estimation. What is irrational is the public debate over this issue, because there is no one who disagrees that we must transition to renewables. Given that understanding, a rational debate would have to do with how speedily we can do this, given all those risk and cost considerations that different sectors of the market are taking into account, and what does government have to guarantee and to whom do they have to guarantee it to get the transition moving in a major way right now.

The public debate does not resemble this at all. The public is wringing their hands while being told that the new technology does not exist at all, which is akin to the claims of conspiracy buffs that NASA never landed on the moon. We are wasting critical time when we allow the public discussion to be framed in those terms, time that could be spent actively defending ourselves from exposure to both foreign control of our critical resources and the morbidity associated with fossil fuel.

This is why I get so exercised about environmental issues ... for whatever reason, these are largely issues where the public debate bears no resemblance to the decisions that actually have to be made. As a citizenry our energies are being frittered away by misdirection, and this is very worrisome for those of us who view energy supply as a critical resource or private property values and productivities as things to be, you know, treasured and protected.

[Frelga]

Surely their own accountants and engineers are not being swayed by lobbyists.

No, I presume not. But if you want to start micro-analyzing the capital decisions that are being made then we have to start considering additional microeconomic dimensions of the decision.

There are rational business reasons why a utility might be reluctant to switch to solar, some of which Jny outlined. The thing is, not all decision making is based on rational business reasons. There are such things as force of habit, ignorance, risk aversion, fear of jeopardizing relationships with important vendors and partners, such as oil companies. There are political pressures that might express themselves in problems getting permits or tax breaks. There are cozy relationship that purchasers and other decision makers form with suppliers. There is corruption, although to a lesser extent than possibly anywhere in the world. For anecdata: an acquaintance mentioned recently that their acquaintance, a project manager, just came back from a trip to Caribbean paid for by a vendor of his company, and was shocked when I pointed out that it's a bribe. There are legal business practices that skirt that line, such as lavish dinners and games of golf, that still might sway the decision makers.

I don't know how much any of that plays into that particular situation, if it plays into it at all. Call me a cynic, but I would be shocked to hear that they don't play any role, and on every count the established, non-renewable technology has an edge over the lean and hungry startups.

[Ellienor]

There are a few states (I'd have to do some research to know how many) who require the utility company to have backward running meters so that you're paid for the electricity that you put back into the system, and that happens continuously during peak insolation.

I live in one of them! Not only that, but dependent on your orientation to the sun, etc., the utility is mandated to pay up to half the cost, on top of the federal rebate. Our cost for a 4 kwh (units?) after rebates is approximately $18,000, approximately half the cost. We'll be signing the contract this week. Our solar guy says that this is the amount of watts that will fully power us in the summer, and will mostly power us in the winter. In otherwords, we don't want to go to "net-zero" or less at this point because as the electricity that we "net" into the system gets paid for a wholesale rates (very low). Too much capacity right now really messes with the ROI, since the solar panels are still comparatively quite expensive. So we are setting up the "infrastructure" and will add on more solar panels later as they get cheaper, and also as we purchase "plug in" vehicles as the come available 2010-2012 timeframe.

So I guess my question is where is the best way to go about finding companies that have excellent reputations in order to get quotes?

Well, in Boulder CO we're tripping over solar installers, but we found ours by asking a general contractor who oversaw the construction of our house. Asking around, I guess, is the best way. Our contractor says that there are NOT a lot of "opportunists" out there, mostly professionals who personally "believe", and are fabulous and ethical to deal with.

Below are the stats:

Project Description: 4.00 kW - Roof Mount PV
Project Detail:
Quantity Description Cost
20 Sanyo Module HIT-200BA3 200 watts/panel $24,387.48
Roof Mount $2,980.00
1 SMA Inverter SB 3000 $2,423.25
1 Combiner $120.00
1 AC Disconnect $120.00
1 DC Disconnect Included $0.00
1 Data Monitoring Included ($420 value)
PV Installation Labor $3,800.00
Electrical Labor $1,080.00
Permit fee and submittal $500.00
Sales tax $1,007.04
2.9% Tax Exemption -$707.24
Xcel rebate -$15,210.00
Discount -$1,900.00
Total System (Out of Pocket) Cost $18,600.54
Fed Tax Credit (for qualifying taxpayers) -$2,000.00Net System Cost $16,600.54

I have highlighted our local utility Xcel rebate, a discount to us for fronting the entire cost and getting rebated oursevles from Xcel (rather than the installer) and the federal credit.